Transparency, inclusivity and development needs take centre stage at the Seventh African Fiscal Forum (Nairobi, 14 and 15 February 2019)

IMF News, February 15, 2019

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Canonical URL: Transparency, inclusivity and development needs take centre stage at the Seventh African Fiscal Forum (Nairobi, 14 and 15 February 2019)

Press Release No. 19/48
Date: February 15, 2019
Organisers: IMF’s African and Fiscal Affairs Department, the Kenyan Treasury and the European Commission
Location: Nairobi, Kenya
Purpose: Annual event bringing together senior officials from ministries responsible for finance across Sub-Saharan Africa (SSA) to discuss fiscal challenges facing the region, share experiences, and entrench a more effective fiscal policy for the region.
Attendance: more than 80 participants, including officials from the finance ministries of about 30 countries and representatives from regional organisations.
Theme: Leveraging Fiscal Policy to Manage Risks and Support Inclusive Growth.

Abebe Selassie (director of the African Department) and Vitor Gaspar (director of the Fiscal Affairs Department of the IMF) highlighted:
- the need to build tax capacity; and
- invest in human and physical capital in a context of still muted economic growth and rising debt burdens.
Kenya’s Minister of Finance, Henry Rotich, stressed:
- using fiscal policy more actively to manage risks and support inclusive growth must not compromise economic and fiscal sustainability.
Félix Fernández-Shaw (director at the European Commission’s DG-DEVCO) stressed:
- the importance of making best use of all financial resources; and
- implementing reforms to improve policies and good governance.

Key finding from IMF analysis cited at the Forum:
- achieving the Sustainable Development Goals in Sub-Saharan Africa would require on average extra annual spending of 20 percent of GDP by 2030 — more than in any other region.
Solutions discussed:
- raising government revenue by enhancing tax capacity;
- strengthening international taxation;
- limiting tax expenditures;
- establishing strong governance frameworks for the much-needed scaling-up of public investment; and
- attracting private investment.

Central discussion: how to gear government spending to promote inclusivity.
Policy directions discussed:
- reforming subsidies and social assistance to reach those in greatest need;
- gender-responsive budgeting as a way for governments to promote equality between sexes and raise economic growth through fiscal and budgetary policies.

Forum view: fiscal transparency is a core component of effective fiscal and risk management.
Rationale: transparency in fiscal operations aids information flow and accountability, and by extension promotes good decision-making.
Regional progress: many countries in Sub-Saharan Africa are making a significant push on fiscal transparency, using means such as IMF-supported fiscal transparency evaluations.

IMF Communications Department, Press Release No. 19/48 (February 15, 2019).