Sustainable Financing

The AU is currently not financed in a predictable, sustainable, equitable or accountable manner. It is heavily dependent on donor funding to run its programs and operations, and this is further compounded by the fact that >40% of Member States do not pay their yearly contributions to the institution.

Further, Member States have limited involvement in the process of setting the AU’s budget, and it was noted that there were no ‘golden rules’ setting out clear financial management and accountability principles in the African Union Commission Statutes and Financial Rules and Regulations. The Commission also does not have a strong oversight and accountability mechanism to ensure that resources are used effectively and prudently

The AU needs to ensure that it can finance its operations and programmes sustainably and with the full ownership of the member states by:

• Expedite the implementation of the 0.2% levy on eligible imports to enable the African Union to finance itself in the long term;
• Adopt complementary measures to reinforce the Kigali Financing Decision

The Committee of Ten African Finance Ministers was nominated to spearhead the process and to assume responsibility for oversight of the AU budget and Reserve Fund and develop a set of ‘golden rules’, establishing clear financial management and accountability principles and establishment of a the use of a Reserve Fund for continental priorities;