The Quest to Promote Accountability, Transparency In African Economies

Ugo Aliogo

A report by the United Nations Conference on Trade and Development (UNCTAD) revealed that between 2000 and 2015, the total illicit capital flight from Africa amounted to $836b, which is more than Africa’s total external debt estimated at $770, in 2018. This situation persists due to poor accountability, and transparency in African economies. Ugo Aliogo in this report examines

Experts have disclosed that African countries loose almost $90 billion in Illicit Financial Flows (IFFs) annually, and much more in illicit resource flows and resource theft, poorly implemented fiscal policy incentives, and excessive dependence on commodity exports for foreign exchange earnings.

The implication of this leakage is that it exposes countries to highly volatile global market prices and vulnerable supply chains. Conversely, these leakage and resources theft can be managed if countries on the continent adopt a strategy for economic governance and framework for the management of illicit financial flows, and a multi-dimensional action plan for the mitigation of debt distress in Africa.

In a quest to ensure that African mobilise and effectively manage the resources needed to increase productivity and create wealth, the African Development Bank (AFDB) Group introduced the African Development Executive Training Programme of the African Development Bank’s Public Finance Management Academy (PFMA).

The programme which was approved in June 2022 by the Board of Directors of the Bank Group, is designed to deliver high-level structured capacity development (training, peer-to-peer learning, technical assistance, and advisory services, institutional support programmes, and policy dialogue) to African Countries on public financial management.

The PFMA is an implementation activity of the African Development Bank Group’s programmes to strengthen the capacity of African countries in economic governance and knowledge management to enhance wealth creation, prudential management of public finances to improve the quality of lives for Africans.
The Bank launched a programme to produce a Public Service Delivery Index (PSDI) to provide an independent and standardized index for assessing the delivery of public services by public servants. The goal is to work with Partners to establish a prize to incentivize improvements in the management of public resources and deliver improved quality of public services to countries.

After an intensive 18 months of rigorous training to complete the Public Finance Management Executive Training Series on the public finance management cycle and ecosystem, first cohort of graduates comprising of 51 public officials from 26 countries were certified by the bank and its partners as public finance management experts in their countries. With this training, they have been equipped to assist their various countries in the areas of effective resources management and economic governance.

Viewpoints of AFDB VP

Speaking recently in Abuja at the graduation ceremony of the first cohort of the Public Finance Management Academy for Africa (PFMA), the Chief Economist and Vice President, AFDB Group, Kevin Urama, charged the graduates to serve as standard-bearers for embedding accountability across Africa.
He called on African countries to come together to mobilise and effectively manage the resources needed to increase productivity and create wealth “in Africa for Africans.”

According to him, “In addition to other CD programmes including Country Diagnostics, ongoing technical assistance, peer to peer learning and networking delivered during the 18 month program, structured executive training programs have been delivered on key thematic areas of the PFM cycle, including on: Domestic revenue mobilization (DRM), Macro-fiscal modelling and forecasting (MFMF), prudential budgeting and expenditure planning and management (including performance-based budgeting and medium-term expenditure frameworks, sustainable borrowing and sustainable debt management, reporting and transparency (including debt sustainability analysis (DSA), public-private partnerships in public financial management, deepening domestic financial markets, and strengthening supreme audit and accountability systems to enhance transparency and curb illicit financial and resource flows in countries.

“In addition, to delivering technical knowledge on PFM, the academy will also work with policymakers on soft skills development to change attitudes and mindsets. This will be achieved through high level policy dialogues with Leaders at all levels. We understand that technical knowledge alone will not create the changes we seek.

“These programmes are complemented by the Bank’s institutional support and program-based operations designed to foster necessary governance reforms needed to curb leakages and corruption, illicit financial and resource flows, and strengthen supreme audit and other oversight functions. Several instruments including Beneficial Ownership Registers and a Public Service Delivery Index (PSDI) are being developed with Partners to help implementation and monitoring over time.

“The rational for focusing on the PFM is obvious. Africa is natural resource rich and often cash poor. Several studies have attributed this to poor management of public resources – from ineffective mobilization and use of domestic revenue, unsustainable borrowing and lack of prudence in the use of debt resources, illicit financial and resource flows, resource theft, among others forms of leakages and corruption along the PFM ecosystems in countries.

Message from the Graduates

Isaac Kurasha of the South African National Treasury, a graduate of the programme, recalled the extensive knowledge imparted by the training and its impact on his work. “This programme has enriched my knowledge of the entire public financial management cycle,” Kurasha said. “Being in public finance, I am only in one component of the cycle. Before this training, I had a basic understanding of the other components that make up the public finance management cycle. Today I am more knowledgeable.”

He noted that the training had taught him to allocate resources where the return on investment was greatest.

Other graduates shared Kurasha’s enthusiasm. Stephen K. Moore, an assistant director in the Budget Finance Department of the Central Bank of Liberia, averred that the training had benefited his career progression, leading to a promotion within the 18-month training period.

“The training has been instrumental in refining my skills and providing a comprehensive understanding of the complexities of public financial management,” Moore hinted that looking ahead, he expressed optimism about the promising avenues that his enhanced expertise will open in his career.

“My expectations are fuelled by the belief that the skills I have acquired will not only enhance my professional standing but will also make a meaningful contributor to my country’s development agenda,” Moore continued.

Elounissi Guebli Nafissa, a civil servant from Algeria, disclosed: “Over the past 18 months, we have been on a fascinating journey, exploring key areas of the PFM cycle in practice. Today marks the end of this exceptional training, an experience that has not only been enriching but also offers significant opportunities for our professional futures.”

“This training was not just a series of academic sessions, but rather a deep immersion into the complex dynamics of public finance,” she added.
“Digital transformation is inevitable nowadays and the integration of modern technologies in public finance management could significantly optimize the efficiency and transparency of processes,” she remarked.

Lubaki Nzalakanda Ange from the Democratic Republic of Congo stated that participating in this PFMA was both a great opportunity and a challenge for the participants.

“On the one hand, it has allowed us to acquire sufficient knowledge to understand the management of public finances.”
To ensure the reduction of poverty and inequalities on the continent now and in the years to come, African countries should accelerate the implementation of appropriate public financial management policies. In this regard, he urged his fellow graduates to live up to the quality training they have received over the past 18 months.

“Africa and our respective countries are counting on all of us,” he revealed.

Stakeholders’ Charge

In remarks, the Special Adviser to the President on Economic Affairs, Dr. Tope Fasua, stated that public financial and debt management remains on the front burners of the federal government’s “Renewed Hope Agenda” for economic growth and shared prosperity for all citizens.

He disclosed that key economic policy objectives of the government include optimization of revenue mobilization and tax reforms, blocking of leakages in public finances, improving public procurement and spending efficiency, and supporting the ease of doing business environment for private sector investments and job creation.

According to him, “The curriculum is undoubtedly rounded and apt for the needs of our countries in upscaling the urgently needed knowledge and capability of public officials who work in the public financial and debt management functions of government. This graduation of deserving participants, which we are witnessing today, December 14, 2023, is a testament to the commitment of the Bank in responding to the need of the regional member countries to fast-track capacity development towards the achievement of the Bank’s High 5’s Agenda, the UN Sustainable Development Goals and the AU Agenda 2063.

“Nigeria has much to share with other African countries in the areas of public finance and debt management. The country has one of the most advanced legal and institutional frameworks and systems for public finance and debt management on the continent including a strong ministry of finance and national development, debt management office, revenue authority, central bank, capital market, commercial banks with operations across the continent, an independent supreme audit institution, anti-corruption agencies, legislature and vibrant civil society and media that ensure adequate oversight and accountability over public finances.

“I understand that the PFMA provides a platform for the aggregation of knowledge from relevant institutions and making them available to our public financial management officials. I find this very innovative in capacity development and should be scaled to other areas of capacity development needs in our governments beyond public financial management.

“I commend the institutions that partner with the AfDB in delivering this innovative programme, especially the World Bank; the International Monetary Fund; the Commonwealth Secretariat; the United Nations Conference on Trade and Development (UNCTAD); Africa Tax Administration Forum (ATAF), Collaborative Africa Budget Reform Initiative (CABRI); African Organisation of English-Speaking Supreme Audit Institutions (AFROSAI-E); West African Institute for Financial and Economic Management (WAIFEM); Macroeconomic and Financial Management Institute of Eastern and Southern Africa (MEFMI); OECD-Global Forum; Open Government Partnership (OGP); Open Ownership (OO); Inter-Governmental Action Group against Money Laundering in West Africa (GIABA); the Africa Finance Corporation, among others.”