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President John Dramani Mahama has called on African leaders to prioritize domestic resource mobilization and reduce dependency on foreign financing to address the continent’s staggering $402 billion annual development funding shortfall.
Speaking at a high-profile African Union (AU) summit dialogue in Ethiopia, Mahama framed self-reliance as critical to achieving sustainable growth and unlocking Africa’s economic potential.
During his keynote address at the Heads of State and Government breakfast meeting—a side event at the AU Summit hosted by the Alliance of African Multilateral Financing Institutions—Mahama pointed to Africa’s projected economic rebound, with growth rates expected to climb to 3.7% in 2024 and 4.03% in 2025. “This optimistic outlook highlights the inherent strength of our economies,” he said, crediting recent policy reforms. However, he cautioned that growth alone has not translated into broader prosperity, with many nations still tethered to low-productivity sectors like raw material extraction.
“The financing gap we face is more than a statistic—it represents the unrealized dreams of millions,” Mahama stressed, referencing the $402 billion annual deficit needed until 2030 to fund infrastructure, education, healthcare, and technology. He warned that external pressures—including climate change, geopolitical instability, and global trade imbalances—threaten to derail progress if African nations fail to act decisively.
To close the gap, Mahama outlined a three-pronged strategy: tightening tax systems to boost domestic revenue, curbing illicit financial flows draining an estimated $88.6 billion yearly from the continent, and accelerating the creation of pan-African financial institutions. He urged faster establishment of the long-delayed African Central Bank, African Investment Bank, and Pan-African Stock Exchange, arguing that such bodies would strengthen the continent’s ability to fund its Agenda 2063 development blueprint.
The dialogue, attended by figures such as Afreximbank President Benedict Oramah and AU financing envoy Donald Kaberuka, also featured sharp insights from World Trade Organization Director-General Ngozi Okonjo-Iweala. She advised against overreliance on debt, noting that 22 African countries are already in or at risk of debt distress. “We must leverage patient capital, like pension funds, and add value to our natural resources instead of exporting them raw,” she said, pointing to carbon credit markets and mineral processing as untapped opportunities.
A subsequent panel on financing Agenda 2063 echoed calls for innovation, with experts emphasizing public-private partnerships and digital financial tools to attract investment. Critics, however, questioned the feasibility of Mahama’s proposals, citing persistent governance gaps and bureaucratic hurdles that have stalled past initiatives.
Mahama’s appeal arrives as Africa grapples with a shifting global financial landscape. With traditional lenders tightening aid and climate funding falling short, the summit’s focus on homegrown solutions reflects a broader recognition of the continent’s urgent need to chart its own economic course. As one delegate remarked, “The era of waiting for external saviors is over—our future rests in our hands.”
The AU’s ability to translate these ambitions into action now faces its toughest test. For millions across the continent, the stakes could not be higher.
News Ghana, Latest Updates and Breaking News of Ghana, News Ghana, https://newsghana.com.gh/mahama-urges-african-nations-to-bridge-402-billion-development-gap-through-self-reliance/
