In an op-ed by Gulfnews.com dated the 1 of February 2015, African leaders teamed up in Addis Ababa the capital of Ethiopia in a bid to seek for solutions for an independent African Union (AU). After a two-day summit which took place at the AU’s headquarters ironically built by the Chinese, African leaders proposed new taxes on hotel stays and airline tickets in a bid to finance the AU. Analysts estimate that this move would raise about $730 million dollars a year. AU officials are also optimistic that an additional half-a-cent tax on SMS exchanges would bring in $1.6 billion. They are hoping to see the AU finance its projects and operations to the tune of 65 per cent by 2016. The AU has for long now depended on financial assistance from the West to accomplish missions on the continent, reason why this international body has been faced with a lot of criticisms. Though it is imperative for the AU to be financially independent, one begins to wonder if the right move to financial independence is by imposing heavy taxes on improvised African citizens.
Gulfnews.com opines that the AU was once seriously financed by assassinated Libyan leader Muammar Gaddafi, who was bent in making this institution an opponent to Western dominance. Presently, the AU which is made up of 54 member states gets only 28 per cent of its half-billion dollar operational budget from these members. 72 per cent of the AU’s operational budget is obtained from international donors especially from the European Union (EU), the World Bank, China, Turkey and the United States of America (USA).
Zimbabwean President, Robert Mugabe, notorious for his ‘tug of war’ with the West, and who is currently the AU’s chair observed that “Over 70 per cent of our budget is foreign funded. This is not sustainable,” This position was corroborated by Kenyan President Uhuru Kenyatta, who has also been involved in a brawl with the West after being charged by the International Criminal Court (ICC) for crimes against humanity. President Uhuru Kenyatta added that dependence on foreign financing was a “profound handicap and an impediment to the continent’s momentum”. According to Kenyan President, it is time for Africa to affirm “its independence and sovereignty more robustly”.
AU analysts argue that a financially viable AU would make this institution administratively and financially dependent. Major donors like Egypt and Libya would not have to chip in huge amounts of money for the running of AU projects and operations. Pan-African Youth Union (PYU) leader adds that the AU would thus be in a better position to make strategic and speedy decisions. He adds that “In case of emergencies like Ebola, we need to have the means to intervene quickly and without having to wait for foreign money. Money from donors always comes with strings attached.”
It is thus a laudable idea for African leaders to make the AU financially independent, but the truth is that such a plan remains an illusion for several reasons. Although African leaders have agreed to this ambitious plan, deducting these taxes is not a matter of right but voluntary. What most member states would do is to impose heavy taxes on visitors and citizens. Besides this worry not all member states will adhere to this new measure. For several years now several African states have not been able to furnish financial nor material support to the running and functioning of the AU reason why this institution has shamefully depended on foreign assistance.
Member states must seek for a holistic approach to making the AU financially viable. Charity begins at home so African states must speed up their industrialization process and infrastructure development to attract more businesses and thus more money. The private sector needs to be revamped in all African states which may would also reduce unemployment and boost African economies speedily. African states cannot continue to neglect the agricultural sector and focus more on the mineral sectors.
African governments have to also stop illicit financial flows which is really crippling African economies, despite the much talked about African renaissance. The money the continent loses can indeed make the AU financially independent rather than relying on foreign assistance and taxes.
Asanji Burnley is a Cameroonian diplomat by training and Masters Graduate from the International Relations Institute of Cameroon (IRIC). He is also co-founder of the Cameroon based Central African Centre for Libertarian Thought and Action (CACLiTA). In 2015 he was unanimously voted as President of this newly created think tank which advocates for limited government and free markets particularly in the central African region.