12
Jun
One of South Africa’s most senior foreign policy advisers has identified the issue of AU self-financing as a key objective for the host country at this week’s AU summit.
Deliberations among African foreign ministers are under way at the Sandton Convention Centre, and a special session on Wednesday afternoon – which continues on Thursday – examined scales of assessment for African countries.
The overarching goal of the AU is to work towards self-reliance in terms of its budget so that it does not have to rely on donors, who often have strings attached to their financial assistance.
AU chairwoman Dr Nkosazana Dlamini-Zuma has historically been suspicious of the agendas of foreign donors, and would like to see the continental body free itself from donor dependency, as 70 percent of its budget has come from foreign donors.
In the short to medium term, the AU would like to see Africa providing for 55 percent of the AU budget and foreign donors 45 percent, which would make African solutions to African problems more tangible.
At the AU summit in January, the AU made strides in addressing its funding challenges in a practical way, reviewing the capacity of African states to increase their contributions.
It was decided that the AU would cover 100 percent of its operating costs, 75 percent of its programme costs, and 25 percent of its peace and security costs.
The view was that the UN Security Council has the primary responsibility for peace and security and should cover most of the costs, although the AU should also contribute.
The new formula that was agreed in terms of contributions was that those countries with economies that represent more than 4 percent of Africa’s total gross domestic product would fund 60 percent of the budget.
Those countries include South Africa, Nigeria, Algeria, Egypt and Angola. Libya is also part of this group but, given its domestic instability, its contributions have been temporarily suspended.
South Africa’s contribution to AU coffers will increase, going from $17 million (R209m) to $60m a year – a hefty cost, given its own development needs.
The AU is hoping to raise a total of $600m a year to fund itself, phased in over five years.
This week’s deliberations will focus on strategies around alternative sources of funding.
Previously, suggestions were made for countries to introduce fuel, hotel, airfare and even SMS levies.
These ideas were met with resistance, given the dependence of some countries on tourism.
A compromise was reached earlier this year that each country would be free to determine how it would raise the money needed to fulfil its AU contribution.
This issue remains a significant challenge to the poorest nations on the continent that struggle to meet even the basic needs of their people.
The AU summit is likely to follow on from the January discussions, take stock of the AU’s finances, and decide how to meet the goals it outlined at the beginning of the year.
As Africa starts to own its own processes, it will come with greater commitment to the programmes it undertakes, and a greater determination to make sure they succeed.
Source: http://www.iol.co.za/news/africa/au-aims-for-self-funding-1.1870116#.VXqb–dB1K5