AfDB Urges African Govts to Unlock ‘Hundreds of Billions’ in Domestic Revenue to Drive Growth

“Domestic resource mobilisation is critical to strengthening resilience, reinforcing sovereignty, and delivering essential public services and infrastructure,” Urama said.

Days after unveiling a strong macroeconomic outlook for the continent, the African Development Bank (AfDB) has called on African governments to urgently scale up domestic resource mobilisation, warning that unlocking internal revenue is critical to sustaining growth and reducing dependence on external financing.

The appeal was made at a high-level ministerial meeting during the 58th Conference of African Ministers of Finance, Planning and Economic Development (COM58), convened by the UN Economic Commission for Africa (UNECA) in Tangier.

Domestic Revenue Key to Africa’s Economic Sovereignty

AfDB Chief Economist and Vice-President for Economic Governance and Knowledge Management, Prof. Kevin Chika Urama, stressed that mobilising domestic resources is central to Africa’s long-term development agenda.

“Domestic resource mobilisation is critical to strengthening resilience, reinforcing sovereignty, and delivering essential public services and infrastructure,” Urama said.

His remarks come amid a shifting global financial landscape marked by declining development aid, rising debt burdens and increasing geopolitical uncertainty—factors that are pushing African nations to look inward for sustainable financing solutions.

Unlocking Untapped Financial Potential

Experts estimate that Africa could mobilise hundreds of billions of dollars annually through improved tax systems, reduced leakages and more efficient financial governance.

Despite recent economic growth, many countries continue to face:

• Narrow tax bases

• Weak revenue collection systems

• High levels of illicit financial flows

• Overreliance on external borrowing

The AfDB argues that addressing these structural challenges could significantly boost fiscal space and fund critical sectors such as infrastructure, healthcare and education.

Five Pillars for Reform

Prof. Urama outlined five key pillars for effective domestic resource mobilisation:

• Strengthening tax policy and administration

• Simplifying tax systems to improve compliance

• Broadening the tax base by diversifying revenue sources

• Enhancing efficiency in revenue collection

• Tackling illicit financial flows and leakages

These reforms, he said, are essential to building resilient economies capable of withstanding global shocks.

Ongoing AfDB Support Across the Continent

Domestic resource mobilisation has been a cornerstone of the AfDB’s governance agenda for over a decade. The Bank currently supports:

• 31 active programmes

• Across 22 African countries

These initiatives aim to improve tax systems, strengthen fiscal institutions and enhance transparency.

Key platforms include:

• The Debt Management Forum for Africa (DeMFA)

• The African Debt Managers Initiative Network (ADMIN)

Both initiatives are designed to strengthen debt governance and fiscal sustainability across the continent.

Policy Roadmap for Ministers

At the Tangier meeting, Urama presented a set of short- and long-term policy recommendations, urging finance ministers to:

• Accelerate digitalisation of tax systems

• Strengthen institutional capacity

• Deepen local capital markets

• Improve public financial management

Participants shared experiences from national reforms, with consensus emerging that domestic revenue mobilisation must become a central pillar of economic policy.

Strategic Priority for Africa’s Transformation

The AfDB’s Ten-Year Strategy (2024–2033) and its newly launched “Four Cardinal Points” agenda place domestic resource mobilisation at the heart of Africa’s development financing strategy.

By reducing dependence on volatile external funding and increasing internal revenue generation, African countries can:

• Strengthen economic sovereignty

• Accelerate industrialisation

• Invest in climate resilience and social services

A Defining Moment for Economic Policy

As Africa navigates a rapidly changing global economy, the message from the AfDB is clear: the continent’s future growth will depend not just on external investment, but on its ability to mobilise and manage its own resources effectively.

With strong economic momentum already underway, experts say that unlocking domestic revenue could be the key to transforming growth into inclusive and sustainable development at scale.