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Tax reform, digitisation key to financing development



This year’s Economic Report on Africa, a flagship publication of the United Nations Economic Commission for Africa (ECA) focuses on fiscal policy.

MARRAKESH, Morocco, March 24, 2019/ — Africa must digitise its economies, broaden its tax base, prevent further deterioration of fiscal and debt positions, and aim for double-digit growth to achieve the UN 2030 global goals (SDGs), and the AU Agenda 2063 according to the 2019 Economic Report on Africa released today at the Conference of Ministers.

This year’s Economic Report on Africa, a flagship publication of the United Nations Economic Commission for Africa (ECA) focuses on fiscal policy. Government revenues account for 21.4%, insufficient to meet countries’ development financing needs.

“The Report identifies several quick wins in Africa’s pursuit of additional fiscal space to finance its accelerated development,” Vera Songwe, the ECA’s Executive Secretary stated at the launch. “[It also] focuses on the instrumental role of fiscal policy in crowding-in investment and creating adequate fiscal space for social policy, including supporting women and youth-led small and medium enterprises.”

But, a decade away from the SDG, she added that “African countries continue to search for policy mixes to help accelerate the achievement of the SDGs. However, for many countries, financing remains the biggest bottleneck with implementing capacity a close second.”

While analysing and highlighting both challenges and opportunities, the Report also recommends comprehensive macroeconomic reforms aimed at building financial resilience, placing emphasis on the need for Africa to accelerate growth to double digits by 2030 and to boost investment from its current 25 per cent of GDP.

While economic growth in Africa remained moderate at 3.2 per cent in 2018 – due to  “solid global growth, a moderate increase in commodity prices and favourable domestic conditions”, the Report emphasises that Africa needs to to do more, and work towards achieving a fine balance between raising revenue and incentivizing investments, in order to boost growth.

In some of Africa’s largest economies—South Africa, Angola and Nigeria – the Report reveals, growth trended upwards but remains vulnerable to shifts in commodity prices. East Africa remains the fastest growing, at 6.1 per cent in 2017 and 6.2 per cent in 2018, while in West Africa, the economy expanded by 3.2 per cent in 2018, up from 2.4 per cent in 2017. Central, North and Southern Africa’s economies grew at a slower pace in 2018 compared to 2017.

On the issue of Africa’s debt burden, the Report reveals that debt levels remained high as African countries increased their borrowing, to ease fiscal pressures most of which have been precipitated by the narrowing of revenue streams that has gone on since the commodity price shocks of 2014.

It argues that African countries can increase government revenue by 12–20 per cent of GDP by adopting a policy framework that strengthen revenue mobilisation, including through digitalising African economies stating that digitization could enhance revenue mobilization by up to 6 per cent.

“Digital identification can broaden the tax base by making it easier to identify and track taxpayers and helping taxpayers meet their tax obligations. By improving tax assessments and administration, it enhances the government’s capacity to mobilize additional resources. Digital ID systems yield gains in efficiency and convenience that could result in savings to taxpayers and government of up to $50 billion a year by 2020.”


United Nations Economic Commission for Africa (ECA).


Egypt, UN discuss activating $1.2B strategic agreement




CAIRO – 16 April 2019: Egypt and the United Nations (UN) discussed supporting a number of development projects and activating the framework strategic agreement between both entities till 2022, worth $1.2 billion.

The meeting was held between Egypt’s Minister of Investment
Sahar Nasr and UN Deputy Secretary General Amina Mohamedon the sidelines of the 2019 ECOSOC Forum on Financing for Development follow-up (FfD Forum) at the UN Headquarters in New York.

The discussed development projects included supporting development in Sinai and Upper Egypt, supporting and developing a water and sanitation systems, developing the education system, health, women’s empowerment and social responsibility, according to the Investment Ministry’s statement.

The UN deputy secretary general praised Egypt’s economic reform program, stating that this program contributed to improving the economic performance which resulted in the positive indicators of the last period.

Mohamed highlighted the pivotal role Egypt plays on the regional and international levels in light of its presidency of the African Union, which helps in discussing several cooperation opportunities between Egypt and the UN. These opportunities include supporting development projects in Egypt, the UN’s role in financing private sector projects to achieve development objectives and deepen the economic relations through joint investments and intra-trade.

She clarified that the United Nations considers Egypt a pioneer in economic reforms, especially in the African continent, where Egypt comes first in the rate of increase of foreign direct investment.

The meeting discussed the role of the United Nations and international institutions in financing projects, and the participation of the private sector in achieving development goals.

For her part, the minister emphasized the government’s interest in boosting the role of the private sector in a number of public development projects, shedding light on the major legislative reforms that are set to enhance the investment climate.

Nasr pointed out that, besides the economic reform, the social aspect has been taken into consideration and support has been provided for the neediest groups. “The government is continuously working to support the neediest classes through direct and indirect support programs.”

Nasr stressed that the UN programs and framework should focus on the poorest and neediest areas in Egypt, referring to the importance of partnership with the United Nations, which comes at an important and strategic time.

The minister also met with Administrator of the United Nations Development Program Achim Steiner, where it was agreed to support Egypt’s program during President Abdel Fatah al-Sisi’s presidency of the African Union. Also,strengthening and deepening the strategic partnership between the African Union and the United Nations Development Program, especially in the field of development in the African continent and the promotion of integration projects and regional integration, was agreed upon.

The two sides also agreed to cooperate in the field of entrepreneurship, as the fund works to support development projects and encourage investments that contribute to the achievement of development goals in areas such as poverty reduction, job creation and renewable energy.

Steiner stressed the keenness of UNDP to strengthen cooperation with Egypt to establish development in the African continent, to achieve economic integration and regional integration, and to advance the African common action.

The minister asserted Egypt’s keenness to establish partnerships with various United Nations organizations to contribute to attracting investments to the African continent, stressing the importance of setting a priority to increase support for the private sector to participate in development, and stimulate the growth of emerging companies in the continent.

– Egypt Today

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Egypt engages in trade cooperation with Portugal




CAIRO – 16 April 2019: Chairman of the Arab Organization for Industrialization Abdel Monemel Taras held a meeting with Portuguese Minister of Defense Joaa Krauwenho to discuss investment opportunities and issues of mutual concern and exchange experiences.

The meeting comes within the framework of efforts to boost mutual cooperation, especially in the field of defense industries, attracting foreign investments and sealing new deals between the two sides.

Taras discussed with Krauwenho ways to localize technology,benefiting from the advanced industrial database of the Arab Organization for Industrialization, specifically in the field of aircraft maintenance, artificial intelligence, insurance and manufacture of communication and electronic devices.

Taras affirmed Egypt’s willingness to boost cooperation and exchange experiences with “brotherly” Portugal,aiming to hold a joint committee to discuss fields of cooperation.
“Egypt’ stability and chairmanship of the African Union urged Portugal to engage in more projects. Mutual cooperation will result in high quality products with competitive prices able to penetrate all markets in the region,” Taras said.

For his part, the Portuguese minister of defense assured his keenness to coordinate and engage in trade with Egypt. Krauwenho lauded Egypt’s accomplishments and peerless efforts made over the last 5 years to achieve economic reform and grasp foreign investors.

“We aspire to open up new horizons of investments and joint manufacturing with Egypt. The Arab Organization for Industrialization owns massive devices and tools sufficient to meet the Egyptian Armed Forces’ needs. ”

The Portuguese ambassador to Cairo and the chairman of the Holding Company of Portuguese Defense Industries praised the Arab Organization for Industrialization for using its surplus in manufacturing new products and taking part in implementing national and development projects.


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ZimFund Water and Sanitation: Harare residents commend ZimFund for engaging communities




Passmore Masanga, a resident of the Mabvuku township in Harare hopes that a new 4.6 km pipeline, installed under the ZimFund Urgent Water Supply and Sanitation Rehabilitation Project Phase II, will change persistent water shortages and bring relief to his family and other residents of Mabvuku, where a water crisis has lingered for years.

“The situation is bad. We wake up around 3am to beat the water queues at a nearby borehole. We hope the replacement of the pipeline, among other factors, will enable us to get water from our taps,” said Masanga.

Masanga was among several residents who aired their views at a recent workshop in Harare. The aim of the workshop, organized by the ZimFund and the Harare City Council, was to exchange knowledge with beneficiaries about ZimFund projects in their communities.

“Engaging communities and sharing ideas with residents who are the intended beneficiaries of ZimFund Water and Sanitation projects is key in ensuring community stewardship of the infrastructure provided under the fund”, said Hardlife Mudzingwa, Community Water Alliance Programs Director.

Workshop participants included residents, councilors, representatives from the Ministry of Finance and Economic Development, the Ministry of Lands, Agriculture, Water, Climate and Rural Resettlement, the Ministry of Local Government and Public Works, ZimFund donors, City of Harare officials and the African Development Bank/ZimFund team.

The ZimFund’s key activities in Harare are to improve the water distribution system, ensure that water-stressed high-density communities secure a reliable supply of water and to improve wastewater management in targeted areas of the city.

These include the rehabilitation of seven sewage pump stations, 11 water pump stations, the replacement of 37km of critical pipelines in the water distribution system and the supply of 15,000 water meters, water meter test bench to test meter accuracy, sewer cleaning vehicles, laboratory equipment, spare pipes and materials, and bulk meters. This is being done at a total cost of US19.2 million dollars and will benefit over half a million people. Some of the works have been completed while some are ongoing.

Speaking during the workshop, Acting Water Director Simon Muserere stated that the city has been facing several challenges in its water and sanitation systems, mainly old infrastructure coupled with lack of capacity to match population growth.

In his closing remarks, African Development Bank Zimbabwe Country Manager, Damoni Kitabire implored the residents to safeguard supplied equipment to ensure sustainability and continued access to water for their families and children.

Workshop participants were also afforded an opportunity to visit Emerald Hill Water Pump Station and Chisipite Sewage Pump Station, which are being rehabilitated, to inspect the progress.

Harare’s water problems have stemmed from several factors, including drought, ageing infrastructure, pollution and a growing population. In the past, the water troubles have led to the outbreak of diseases like typhoid and cholera.

In 2014 a survey by the government and international aid agencies found that only 40 percent of Harare households had access to clean drinking water and sanitation, from 95 percent in 2009, according to a Reuters news report.

ZimFund is a US$145 million water and sanitation and energy programme, which was established in 2010 after the 2008 cholera outbreak. Its donors include; Australia, Denmark, Germany, Norway, Sweden, Switzerland and United Kingdom. ZimFund is managed by the African Development Bank as part of its operations to improve the quality of life in Zimbabwe. The Bank also supports Zimbabwe in the agriculture, transport, energy, water and sanitation, institutional development and capacity building, humanitarian, social and financial services sectors.

– African Development Bank

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