EDITORIAL COMMENT: Tax to boost African independence

chronicleIt is a paradox that as Africa flaunts its political independence, the continent continues to rely economically on the countries that it defeated militarily to attain Uhuru.

A few African countries actually have their annual budgets funded by foreigners. Malawi’s, for instance is supported to the tune of 40 percent with Mozambique’s at an estimated two thirds by 2010 or so. The foreign support goes beyond individual countries to regional groupings like Sadc. From the 24th Ordinary Session of the General Assembly of the African Union in Addis Ababa, Ethiopia last week, we learnt, most sadly, that 72 percent of our continental bloc’s budget is funded by the United States and European Union. Membership contributions to the AU account for 28 percent. For Sadc only 21 percent of the budget is collected from member states, 79 percent from western donors.

It is an unsustainable state of affairs; it cheapens our independence. History has taught us that countries or their organisations, even households, cannot thrive on donations yet we, as Africans have tended to condone that situation.

Our political leadership and Pan-African scholars have spoken against this but not much work has been done to actually undo the contradiction.

In July last year, Sadc executive secretary Stergomena Lawrence Tax cautioned the 15-member bloc over relying too much on donor funding, warning that this would not solve many developmental challenges facing the region.

“Notwithstanding progress made in the execution of the mandate of the Organ on Politics, Defence and Security Cooperation,” she said, “a number of challenges have been encountered. The major challenge which continues to face our activities in implementing our politics, defence and security undertakings is resources constraints, characterised by high dependence on support by the international cooperating partners. As long as donor contributions are the major source of our funding, it will be hard for us to independently realise our objectives — without pandering to the whims of others. This disturbing situation requires immediate attention.”

At the AU, key institutions such as the Pan-African Parliament, the Human Rights Commission and the Anti-Corruption Board operate on foreign aid.

Allowing foreigners, particularly westerners who are known for their hostility to the Pan-African agenda, to fund critical organs of the AU or any regional grouping or individual country poses an extraordinary threat to development, peace, stability and sovereignty of nations. Sadc had a bad experience with the Sadc Tribunal, a regional court formed by the bloc but its judges’ salaries were paid by westerners. The court kowtowed to its benefactors in discharging its mandate. For example, it passed many judgments in favour of white former commercial farmers in Zimbabwe even as the Supreme Court had asserted the irreversibility of the land reform programme.

AU chairperson, President Mugabe expressed dismay at the union’s reliance on donors. Officially closing the summit on Saturday, he said Africa must harness her resources to affirm her sovereignty to the maximum and be able to domesticate the AU budget.

“Our lofty ideals in Vision 2063 would come to naught unless we take strong and decisive steps to confront the financial challenges confronting our continent. A situation where over 70 percent of the AU budget is foreign funded is certainly unsustainable. It is also a serious threat to the security and well-being of our people,” he said.

About 28 percent of the 54-member AU’s $500 million operational budget is raised from members. Also, the AU obtains an additional $750 million for peacekeeping operations from the European Union, United States, World Bank, China and Turkey.

We are encouraged that the summit adopted a resolution for alternative sources of funding to enable the AU to finance its own running costs 100 percent, as well as at least 75 percent of its programme expenses and no less than 25 percent of its peacekeeping operations within the next five years.

The bloc is proposing a $10 tax on flight tickets to and from African destinations, plus a $2 tax on each night spent in a hotel. It is estimated that the levies will rake in $730 million yearly. There is another proposal for a half-a-cent tax on SMS exchanges, expected to raise $1.6 billion.

These proposals look viable. We acknowledge that they, indeed, would make Africa more expensive as a tourism destination and our growing mobile phone communication costlier. However, Africa must be always alive to the existential agenda of striving to attain true independence.

With President Mugabe in the chair this year, we are confident that he will use his experience back home to push for greater economic and thus operational independence of the continental grouping. The AU will certainly not achieve this in this year of the President’s chairmanship, but a foundation should be laid for those who will come after him to build on.

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