Kenya calls for controlled expenditure by African Union

Saturday June 30 2018

Monica Juma

Foreign Affairs Cabinet Secretary Monica Juma who has told a gathering of external relations ministers that the AU needs to tighten its financial responsibility to regain credibility. PHOTO | FILE | NATION MEDIA GROUP 

AGGREY MUTAMBO
By AGGREY MUTAMBO
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Kenya is calling for further efforts to control expenditure at the African Union (AU), even as it struggles to pay up its membership fees to the continental body.

Ahead of the African Union Summit due on Sunday in the Mauritanian capital of Nouakchott, Foreign Affairs Cabinet Secretary Monica Juma told a gathering of external relations ministers that the AU needs to tighten its financial responsibility to regain credibility.

“The African Union must enhance integrity especially at this time when our citizens are calling on their governments to account for every cent of public finances,” she said in a speech sent from her office on Saturday.

Dr Juma, who is leading the Kenyan delegation to the 31st Ordinary Summit of the AU, was speaking during a meeting of foreign ministers commonly known as the Executive Council, to discuss the budgetary approvals and report of financing for the continental body.

The Summit in the Mauritanian capital is mostly meant to discuss administrative issues, but the theme is also about corruption and reforms within the AU.

With 55 members (including Morocco which re-joined last year), the AU should be in rude financial health except that its programmes are financed nearly 60 per cent of the time from donors such as the European Union, China, UK, US and Norway among others.

This is partly because member countries often default on their share of the contribution, mostly because they are too poor to pay up or do not feel obligated to pay.

“On average, 67 per cent of assessed contribution is collected annually from member states. About 30 member states default either partially or completely, on average, annually,” the AU’s financing report says.

“This creates a significant funding gap between planned budget and actual funding, which hinders effective delivery of the African Union’s agenda.”

Traditionally, the AU Commission is supposed to establish a committee of ministers of Finance from the member states, two for each of the five regions, who prepare, monitor and evaluate the annual budget of the Union, after which the heads of state endorse it.

With the AU reluctant to publish a list of defaulters, it is usually difficult to know who has cleared or is in arrears.

However, at the start of President Uhuru Kenyatta’s first term in 2013, Kenya owed the African Union about Ksh300 million ($3 million), according to a report by the Centre for the Citizen’s Participation in the African Union, an organisation that campaigns for openness at the continental body.

Running behind schedule to clear arrears in international bodies, the National Treasury last year announced it would reduce its more than Ksh700 million ($7million bill owed to bodies like AU, UN, Comesa and IGAD through the import declaration fees deposited in a special kitty.

Punish impropriety

Dr Juma told the executive council that the African Union must punish financial impropriety and strengthen its own accounting systems, even as it seeks more independence from donors.

The African Union has since July 2016 been seeking more ways of financing its own programmes.

It, for example, passed a policy to levy 0.2 per cent tax on goods imported into Africa from outside.

Kenya, Rwanda, Chad and Ethiopia and the Democratic Republic of Congo, have all announced they will be levying the tax.

But the AU’s three-part budget of operations and administration, programmes and emergencies as well as peace efforts means the AU requires at least $700 million annually to run properly.

The AU categorises its member states in three tiers based on economy sizes starting with biggest economies like Nigeria, South Africa, Algeria, and Egypt who pay at least 12 per cent of the membership fee ($110 million for this year).

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