ECONOMIC COMMISSION FOR AFRICA
African Institute for Higher Technical Training and Research
Meeting of Plenipotentiaries Addis Ababa, 23-24 July 1979 Governing Council
First Session
Addis Ababa, 25-28 July 1979
FINANCING OF THE INSTITUTE AND MEMBER STATES' CONTRIBUTIONS
1. Introduction
In endorsing the proposal to establish an African Institute for
Higher Technical Training and, Researph, the Intergovernmental Expert Group Meeting which was held in Addis Ababa in November 1978 recommended,
inter alia, the following basic principles for the establishment and
development of the Institute:^/
(i) the Institute shall be an intergovernmental African institute with, characteristic African orientation in its mission and
programmes;
(ii) accordingly, the.Institute shall be owned and managed by African States and shall be developed and financed on the basis of
co-operation and collective self-reliance5
(iii) while the financing of the Institute shall be the primary
responsibility of member States of the Institute, supplementary assistance from bilateral and multilateral organizations and agencies in programme support and other forms of technical co-operation arrangements, shall be welcomed always, provided such assistance is in no way tied to objectives that are inconsistent with the purpose and functions of the Institute;
l/ Report of the-Intergovernmental Expert Group Meeting on the Establishment of an African Institute for Higher Technical Training and
Research, document s/CN.14/lNF/95 - PAMM/ed/65, paragraphs 62 to 67 and 72.
W79-944
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(iv) member States shall contribute equally to the capital and
running cost of the Institute.
(v) the host country should "be obliged to contribute substantially
to the financing of the Institute through the provision of institutional infrastructure and grants for the operation of the Institute, thereby ensuring its viability.
2. Purpose of the Secretariat Paper
The intention of this brief paper is to elaborate on some of the basic principles outlined above, in particular the principle of equal contribution to the budget of the Institute by all member States subscribing to the
Constitution establishing the Institute. A further objective is to weigh the advantages and disadvantages of that recommendation and to submit a compromise proposal which takes account of the need to ensure equal
responsibility for the development and growth of the Institute and at the same time recognize the fact. ;of life that African States are at different stages of development with varying levels of income or resource capability.
In submitting the compromise proposal it is duly recognized that
authority for the determination of the manner and level of member States*
contributions to the budget of the Institute lies solely with its Governing Council. Therefore? all prior debate on the original
recommendation by 'the . Intergovernmental Expert Group Meeting referred to above and the compromise proposal.by the Secretariat are only meant to provide.a-rational basis for the consideration of the matter by the Governing Council and to facilitate its decision on it.
3. Principle of equal contribution
The need for African States to assume primary responsibility for financing an institution they regard as of paramount importance in the
pursuit of collective self-reliance in the development of the technical manpower resource of the region doea not call for any debate. There is
no other option to African States assuming direct and effective,responsibility for the development of the Institute and the orientation
of its training and research activities. Acceptance of this responsibility will ensure effective ownership, management and direction by African
member States.
Equal contribution to the capital and recurrent budget of the^Institute has been justified by the need to ensure equal responsibility for its
survival and growth. It also implies equal control by all member States.
The' Constitution and in particular the Rules of Procedure of the Governing Council stipulate that all member States or their representatives at the Governing Council shall have equal votes. It is therefore reasonable to attach equal financial contribution to the right of equal vote. The principle of equal contribution also implies equality of treatment in deriving advantages from the programme activities of the Institute, and in particular equal distribution of trainee places and fellowship awards.
All these arguments appear reasonable and fair.,
Looking at the other side of the issue and having regard to the realities of the African situation, however, several member States may not subscribe to the principle of equal contribution. In fact, at the meeting of the expert group already referred to, a number of delegates formally expressed their reservations on the recommendation that all member States should contribute equally to the budget of the Institute.
It is common knowledge that African countries are not all equally endowed with resources: educational infrastructure, research capability, level of economic and social development, resources of trained manpower, size of population, and other basic indices of socio-economic development vary a great deal between one country and another. Accordingly, capability to support the Institute and use its programme facilities will vary, depending upon a country's level of development, its own local training capability, its technical manpower requirements and other factors that hardly need any elaboration- While it is fair to ensure that the
relatively more developed African countries have the same vote in OAU and in ECA as the less developed and newly independent countries, it cannot be considered equally fair to expect that Cape Verde, Seychelles, Djibouti and The Gambia, .for example, should make the same financial contribution as Algeria, Nigeria, Egypt, Morocco and Zambia to the support of an inter
governmental institution.
The principle of collective self-reliance to which all African States subscribe requires that group welfare should be ensured through the better- off member States helping' to improve the lot of the less well-off.
Essentially5 co-operation and collective'self-reliance requires that member
States should share in the task and benefits of development, each
according to its ability and means.
A further consideration is that the Institute is to operate for the benefit of all African States. Hopefully, it is expected that all African States will subscribe to the Constitution establishing the Institute. . Consequently, nothing should be done either now or in the future that will make it impossible or difficult for any member State that approves the objectives of the Institute and would like to benefit from its activities to become an active member of the Institute. Equal contribution to.the budget of the Institute would mean that the more developed and wealthier African States would find the financial obligation much easier to meet while the poorer member States would find it much more difficult, if not impossible, to meet their contributions. As in taxation,, the incidence, of equal levy of contribution would be greater on, and rather unfair to, the poorer member States, but lighter on, and more advantageous to-the_
richer member States. . Equal treatment in bearing the burden of maintain ing the Institute requires that the incidence of the financial contribution should affect all member States fairly equally. . This requires that each- member State should contribute to the budget of the Institute according
to its capability and resources.
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4# Compromise Proposal
From the foregoing argument it is apparent that neither the principle of equal contribution nor that of contribution on the basis of capability,
applied alone, can meet the concensus of all member States. To ensure thefullest support of the greatest number of member States both in contribut
ing to' the budget of the Institute and in taking advantage of its programme activities, the two basic principles should be combined as follows;Member States should 'be grouped into five categories according to■
their gross domestic product-which for the purpose of contribution
to the Institute's budget would reflect varying degrees of their capability to support the Institute. It further recognizes that countries within the same range of income as measured by their GDP should be treated equally in being called upon to make financial sacrifice for the Institute. Consequently, as opposed to equal contribution a6ross the board for all member States, equalcontribution should apply only to a group of countries whose income capability falls within the same range of GDP.
Table 1 provides comparative indices of African States.1 contributions to a selected number of intergovernmental organizations and institutions.
Member States have regularly accepted the OAU scale of contribution which is based on the principle of capability to contribute. The African
Regional Centre for Technology uses th« same scale of contribution. IDEP follows a similar principle. By contrast, C&FKAD recognizes differences in the income capacity of member States and consequently it has grouped them into five income ranges for equal levy within each income range.
The last column of the table of contributions indicates the rate that could apply 'to each member State when all 49 States become member of the Institute. Table 2 shows the grouping of countries into income or GDP ranges., the rate of equal contribution within each range and the difference between the sacrifice required of the least able and the most capable.
Thus the rate applicable to the Gambia or Guinea Bissau and that applicable to Libya or Nigeria differs by a factor of 5« T^e rate applicable can be compared with those of CAFRAD, Reduced number of membership would
automatically increase the rates applicable to the different income or GDP groups.
5- Charges for Services
One further recommendation that the expert group meeting made and which the.Secretariat fully endorsed is that the Institute should charge fees for its courses as well as an element of overhead costs per student intake. By this arrangement the Institute is not' expected to turn itself into a profit-making institution? rather it is' expected to recover some of the costs of providing its services. The Institute should still regard its primary task as that of training African personnel and treat revenue earnings from training activities as secondary.
The Institute will be expected to charge adinission9 tuition and examination fees. ■ In addition? a- good part-'c-f - the-adm-inist-rative over head cost of running, the ^Institute and developing course programmes should be calculated in terms of unit cost per student and recovered from clients sending students for training at tho Institute. This is another form of contribution by member States and should be regarded as a. .levy. b.as.ed_..cn... individual member State's utilisation of the services of the Institute. This is only.supplementary to the direct annual
contributions for the support of the Institute. For example, Botswana and
Egypt may..be taken_as .members. Botswa-na--coritributes Vfo and Egypt pfo of the Institute's budget as direct assessment.' 'in the same year"Botswana accounted for 10 student/year of training at the Institute and.Egypt 75.
student/years while the administrative overhead cost for the Institute worked out at US'^OO per-student/year. On'the basis of "pay as you use ,.
the facilities" of the Institute, Botswana;would be required to pay a supplementary overhead cost of only USf^OOG and Egypt US:;37?5O0. This . would appear a fair treatment of both clients. . ■■
Recommendation; Action required' j, i . . i ; -
• Having considered the advantages and disadvantages of the above , .
proposals and having regard to the necessity to ensure that the Institute's
financing is soundly assured; the meeting is invited tos(a) favourably consider adopting for the Institute the combined . principles of equal contribution and income capacity of
member Statess accordingly, use five income ranges in
grouping member -States and apply, varying rates of contribu- , tions to the different income groups?
(b) alternatively? adopt for-.the Institute the OAU index of member States' contribution;
(c) mandate the Institute to charge its clients a proportion of
its administrative overhead costs as per student per year;overhead costs recoverable from its clients according to the number of nationals such clients send to the Institute.
This amount shall be additional to the direct contributions recommended above and shall not preclude the Institute from charging admission, tuition and .examination fees or other legitimate fees.
I- A^iu/ A In r Page.6
G C/ 5
Table.1
Comparative Indices of African States Contributions to Intergovernmental Organizations and Institutions
(in percentages)
Member States OAU CAFRAD IDEF
(1977) (1979) (1978)
African Centre for Technology
Recomoended for the Institute
1.
2.
3.
4.
5.6.
7.
8.9- 10.
11.
12.
13.
14-
15-
16.17.18.
19-
20.
21.
22.
23.
24.
25.26.
27.28.
29.
30.
31.
32.
33.
34.
35-
Algeria Angola Benin Botswana Burundi
Cameroon Cape Verde
Central African Smpir©
Chad Comoros Congo Djibouti Egypt Ethiopia
Equatorial Guinea Gabon
Gambia;
Ghana Guinea
Guinea Bissau Ivory Coast Kenya
Lesotho Liberia Libya Madagascar Malawi Mali
Mauritania Mauritius Morocco Mozambique
Niger Nigeria Rwanda
6,15
2.36 0-54 1.96■ 0,61
■1-86 ■
0,540.69 0f6l 0.501.35
7.572.00 1.01 6.29 0.61 0.683.24 0.95 3-132.28 0.541.81 10.00 1.23
O.83
0.54 0.94 1.55 4.30 1.92 0.727.63
0.506.13
1.02 1,02 3.06 1,02 2,04
6.13
2.04 1.02 . 4.O8
1.02 4.08 4.08 2.04 6.13
1.02 2.04 /
11.16^
2.04
6.13
7.9 1.4 1.4 2,4 1.4 1.4 1.4 7.9 3.4 2.0 1.0 3.4 2.0
3.4 3.4 1.4 7.9 2.0 1.4 1.4 1.0 1.4 3.4 1.4 7.9 1.4
c0
•H
■H -P 00
<H 0
0 i-H O in
0
%
Tfl
5.30 2.12 1.04 . 1.06 .1.06 2.12 1.06 1.06 i;o6- 1.06 1.06 1.06 5.30 3.18 I, Of 2.12 1.06 3.18 1.06 1.06 3.183.18 1. 06 1,06 5.30 2.12 2,12 1.06 1.06 1.06 4.24 2.12
-1 r\f
1.06 5.30 1.06
a/ Host country.
Table 1 (Cont'd)
36..
37. 38.
40.
41.- 42.
43.
44.
45-
46.47,48,
49,
Member States
.Sao Tome & Principe Senegal
Seychelles Sierra Leone Somalia Sudan.
Swaziland Tanzania
Togo ' '*■
Tunisia Uganda Upper Volta
Zaire Zambia
OAIT CAFRAD IDEP
(1977) (1979) (1979)
1.29 O.96
1.55
1.37 0.691.85 T.9'6"1.64
1.183.53 0.54 2.15 3- 273.06 2.04- .1.02.
4.08 T.TJ2
3.06 2.044.08 -3-06 2.04 4.08-
3.06
2.4 2.0 1.0 3.4 2.4 1 i 4 2.4 2.4 1.4 3.4 3.4
African, Recommended Centre for for the Technology Institute
0)
■H O O 03 -H -P
03 -P O
&
CO O
1.06 5.12- 1,06 1.06 1.06 3.18 3.18 ,1*06 3.18 2.12 1.06 3,18
3.18
100.00 100.00 100.0 100.00
Sources Data was derived from the following documents!
IDSP - Summary Report on IDEP's Financial Situation, Appendix 2
and ECA Conference of Ministers resolution 2o"HJU.i;-
African Regional Centre for Technology - Report of the First
Meeting of the Executive Board, document ARCT/JJJJ/1/y .
Annex IV. ., ■
CAFRAD - New level of CAFRAD Member States' Contributions for ■;
the period 1979 - 1984, Eighteenth Meeting of the
Governing Board, document DG.l/?8 Doc.9, Appendix III.
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Table 2
Assessment of Mem"ber States for the Support" of Intergovernmental Institutions
(in percentages)
Countries1
Group Is Countries
■ .
Benin
-Botswana .
Burundi -Gape Verde
Central African Empire Chad
Comores Congo Djibouti
Equatorial Guinea The Gamb ia
Guinea
Guinea Bissau Lesotho
Liberia Mali
Mauritania , Mauritius Niger Rwanda
Sao Tome & Principe Seychelles
Sierra Leone Somalia Swaziland Togo
Upper Volta
1977 GDP at 1970 constant
factor price
with GDP less than
•USC million 270.8 . . ■ 174.8 - 252.4
I84.4
23.1 360.1 27.4 319.0 79.454.8 368.663.9 . 97.9 472.869.9
310.6 209.9 305.6 453-4250.7 16.5
20.9 429.6284-9
156.0 242.2 270.2
n ATfD A Tl WAr xui.U
(1979)
VS&500
'■#
1.02 1.02
1.02 2.04
1.02 1.02
2.04 1.02 2.04 2.04
2.04 1.02 1.02 2.04 2.04
Eecommended for the Institute by- Expert Group
Meetifeg
million (Factor
*
M\
03O
^j- O
.
CM
■a '
0*^-
•
CM
O 0}O
v-t-
0
•
CM
:Recommended by ECA for the Institute
1)
1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06 1.06
Table 2 (Cont'd)
- - - -- ■ - ... . . Recommended
'[,_ ' " 1977 GDP at CAVVAT) for the Recommended
Countries .'. '' 1970 constant (-1070) Institute by by ECA for
factor price y ty J Expert Group the Institute
" ;_ Meeting
Group Us Countries with GDP between US&500 million & US$1,500_million(Factor 2) ---"--■' ■■- --'-US^-ni-i-11-ion #....■ '■...% . ' . $>
Angola 830.0 ■ 2.12
Cameroon 1,219.. 2 3.06 -g 2.12
Gabon .682.4 2,04 g -2.12,
Madagascar 817.4 ' ^- ^»12
Malawi ■' "519.6 * ° 2%\2
Senegal . '.961.8 3.06 2.12
.ygan&w...,..^ _.;_':...'„... ^.h^Q-$ 3.06 2.12
Group Ills Countries with GDF between US$1,500 million & US$3»000 million (Factor 3)
Ethiopia 2,046.8 3.18
Ghana 2,344-3 4.08 3.18
Ivory Coast 1,942.7 4.08 3-18
Kenya ... 2,038.1 4.08 ■§ 3.18
Sudan ",., 2,240.4 .4.08 g ■ 3-18
Tanzania 1,563-4 3-06 3.18
Tunisia 2S 273-1 4-08 o 3.18
Zaire 2,047-7 4-08 cm 3.18
Zambia 1,682.9 3.06 . ■ 3.18
Group IV* Countries with GDP between US^3,000 million and U6$6,000 milliot.
(Factor TT
Morocco 4,321.7 11.16 2.04 4.24
(host country)
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Table 2 (Cont'd)
Countries
1977 GDP at 1970 constant factor price
CAFRAD
(1979)
Recommended for the Institute by Expert Group
Meeting
Group.-V: ■ Xourteie-s with GDP o.f over US$g,000 million (Factor-^) US$ million ■ ■ . % %
Algeria Egypt Libya Nigeria
■
: ■ Total
6,004.1
8,9-15.2 6,397.9 11,976.5
6,13 6.. 13 .6.13 6.13
O OJ
Eedoamended by ^GA for the InstitutG
100.00 100,0
5.30 5.30 5.30
.5*20
100.00
