With dwindling global funding, Africa should chart a bold path

As East Africa’s Finance Ministers unveiled their budgets this week, the region’s top philanthropic funders met in Kigali amid growing uncertainty in global development financing.

For all that gathered, it was clear that without bold and innovative action, development financing faces an uncertain future. Except in Kenya, where protests over the savage police killing of Albert Ojwang’ shifted focus from the budget, East African Finance Ministers presented their finance bills without disruption.

Kenya will have to narrow the fiscal deficit, avoid punitive tax hikes and cut back on government expenditure. Uganda’s budget will remain relatively flat with new investment in crude oil production. Tanzania’s budget shall continue to focus on essential health, education and water services as well upcoming elections. Rwanda ambitiously seeks to raise and spend their budget by 21 per cent with 58 per cent of this coming from domestic funding.

This year’s budgets face one of the most disruptive moments since the structural adjustment policies and the return of political pluralism in the 1990s. Sharp reductions in bilateral development financing, generative artificial intelligence, new digital technologies and the rise of “my country first” authoritarian governments has just changed three decades of global aid finance models. The challenge is less about how African states and public benefit organisations meet the financing gap now estimated at USD 7 trillion. For the 500 leaders that gathered in Kigali, Rwanda for the 9th East African Philanthropy Conference, the preoccupation must be to trigger African economic liberation, community empowerment, equality and rights for all. How do we stop our elites handing our minerals, labour and commodities to other elites to grow their own economies? How do we stop those governing our states from stealing and wasting our precious taxes on themselves? Without predictable development assistance, how does East Africa avoid civil strife and conflict caused by the failure of states to meet their obligations to their populations?

Seized well, crises become moments of opportunity also. The overseas development industry has long been criticised as financially limited, donor led and foreign capital dependent. “Aid” has been the soft power the global north countries used to control our economies, access our markets and prevent us from developing independent economies and regional integration. Now that a new generation of elected leaders across Europe and North America has declared their disinterest in global poverty and equality or well governed and stable African economies, African states, corporates and public benefits organisations need a new paradigm in their own interest.

This current feeling of financial fragility is less about the realignment of global north-south power relations. It is more about the weaknesses structurally built into and hidden in the multi-lateral system. For too long, African Presidents have signed trade agreements that remain skewed towards African resources leaving the continent. Loans have been intentionally designed and contracted leaving poorer countries paying greater interest than richer countries. Corporates have influenced taxation policies which ensure large investors are relieved of their obligations while the pressure amounts on individual citizens. To survive the sharp cutbacks in public health, education and agriculture funding as well as the coming storm of citizen’s expectations, East African governments must proactively embrace their sovereign responsibility or watch their countries slide into ungovernability and crisis. Public benefits organisations in the region must also adapt or perish. Orphaned by past international funding partners and defunded, they must re-centre their work within the communities they serve. They must also seek to consciously transform the domestic governance eco-system and stop playing in the periphery of power.

Peter Kamalingin, a Pan-African development leader and global justice advocate, passed away this week. Before becoming UNAIDS Country Director in Kenya, he spent 25 years with Care, Oxfam and ActionAid International, fighting hunger, improving public health and farming, and promoting greater justice and equality across Africa. Let’s honour his memory by protecting the progress Africa has made in the past decade. 

irungu.houghton@amnesty.or.ke