The African Union Commission and the secretariats of regional economic communities can also help coordinate donor assistance to aid integration. The African Development Bank, the Economic Commission for Africa, the European Union, the World Bank, and a host of other institutions and countries continue to show interest in supporting Africa’s integration agenda. It has been difficult for the African Union Commission and the regional economic communities to prevent overlapping assistance from these sources. But it is in the collective interest of the African Union, regional economic communities, and development partners to ensure that coordination improves the effectiveness of aid.
Rationalizing the regional economic communities. Multiple, uncoordinated, and poorly supported regional economic communities will not be solid enough building blocks to create the much-needed African Union. The Economic Commission for Africa will devote its next report on Africa’s integration to rationalizing the regional economic communities—to help member states make informed decisions. In the meantime, creation of additional integration groupings should stop and member states should evaluate the costs and benefits of memberships in multiple regional economic communities, with a view to eventually adhering to only one community.
Anchoring the African Union on a solid financial basis. A flaw in the African Union is the absence of a financial plan for its establishment.The European Union could not have reached its present level of sophistication without innovative, adequate, and sustained financing through various mechanisms, including selected imposition of taxes. Today, The African Union
Commission and the secretariats of regional economic communities can also help coordinate donor assistance to aid integration
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the EU-financed budget runs in the billions of dollars, with a significant share used to level the playing field by supporting the economies of weaker countries under the Structural Fund.
Africa’s integration and the African Union cannot be funded solely by the traditionally unreliable financial contributions of member states or outside support. Relying princi-pally on assessed contributions has proven unsustainable for regional economic com-munities. And dependence on external assistance, decreasing lately, is not a viable way to buttress the African Union or integration in general because it is so capital-intensive.
Building an effective African Union and ensuring a brighter future for Africa’s inte-gration require more than a precarious dependence on these limited traditional sources of financing. They require more innovative and sustainable approaches to achieve an autonomous and self-dependent integration process (box 4.1).
External assistance, decreasing lately, is not a viable way to buttress the African Union or integration in general
Box 4.1
Guiding principles for sustaining financing
It is necessary to identify the key players in Africa’s integration process and define or clarify their roles.
Any intergovernmental organization or institutional arrangement purporting to advance the course of Africa’s integration may have legitimate claims on resources mobilized to finance the process. But such claims have to be scrutinized for what they are worth, implying that the current potpourri of insti-tutional and operational settings should be looked into, streamlined, or rationalized, leaving a core coordinated arrangement for building the African Union and revitalizing Africa’s integration.
Only a few critical organizations may be worth retaining and becoming eligible for support from the African Union and related resources. Rationalizing the various entities requires address-ing some difficult issues. For instance, clarifyaddress-ing the precise roles of the proposed African Investment Bank and the existing African Development Bank will prevent duplicative mecha-nisms competing for the same and limited resources, as will clarifying the roles of the organs of the regional economic communities and those of the African Union. Another task is determining what technical bodies (bilateral or subregional intergovernmental organizations) should be retained by the regional economic communities or the African Union and how their interrelation-ships should be defined.
Once the maze of institutional settings has been navigated, it will be necessary to estimate the short-, medium-, and long-term financial needs (operating expenses and operational activi-ties) of all the core actors, avoiding duplication of effort. The exercise must be as accurate and predictable as possible, with objective criteria for allocating resources, where possible.
The self-financing mechanism approach can, according to technical studies and its appli-cation by the West African Economic and Monetary Union (and to some extent by the Central African Economic and Monetary Community and the Economic Community of West African States), be a viable and sustainable formula for overcoming the financial crunch facing regional economic communities. Indeed, even with a very low rate the yield of such a levy would be sig-nificant and could grow steadily.
Source:Economic Commission for Africa, from official sources.
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Fulfilling responsibilities by member states. Member states need to demonstrate their political commitment to integration at the national level through serious measures and actions to implement community decisions. They must provide maximum support to the regional economic communities, including endowing them with adequate supra-national authority to enforce implementation of such decisions. Specifically, countries need to set up an integration ministry, relevant subnational structures, or an appointed coordinator with full authority and capacity to coordinate and monitor the implemen-tation of the commitments made to regional economic communities and the African Union. This authority should include the ability to ensure more efficient coordination between the objectives and instruments of regional integration and national economic policymaking organs, to ensure payment of assessed contributions on a regular basis, and to follow up on regional programmes and commitments. Each country should also set up a national task force with representatives from the private sector and civil soci-ety to map out a strategy to fulfil its responsibilities.
Other subregional and regional actions. As building blocks for the African Union, the regional economic communities must be streamlined and strengthened to ensure that they:
• Avoid engaging in activities in which others—for example, nation states or regional organizations—have comparative advantage.
• Operate as efficiently as possible, with the power to exercise sanctions on countries that fail to fulfil their obligations.
• Set priorities for their activities, striking a balance between social dimensions and economic priorities.
• Develop a coherent approach to working with other stakeholders—including civil society, political parties, women, and youth—in the interest of the common good.
• Meet their obligations under the WTO and position themselves effectively for negotiations with the European Union.
At the continent level, stakeholders need to take steps to:
• Adopt a rule-based system for implementing Africa’s regional integration agenda to enforce standards and commitments to integration at all levels.
• Develop a rigorous coordinating and monitoring mechanism to track progress on integration at all levels.
• Build mass awareness of integration among the African people and involve them in the process.
• Hold member states accountable to the common values embedded in the rule of law, constitutionalism, good economic and political governance, and respect for human rights.
• Institutionalize the involvement of the private sector in the structures of the African Union’s decisionmaking.
Countries need to set up an integration ministry, relevant subnational structures, or an appointed coordinator with full authority and capacity
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