Governments in Africa have a prime objective—to reduce poverty. To improve living standards and create jobs, they need to provide their citizens with better health care, better education, more infrastructure. They need to build hospitals, schools, and to pay doctors, nurses, teachers. All this costs money, and how to pay for this—in a way that is both fair and efficient—is a major challenge. With limits to how much a government can receive as grants or borrow, raising tax revenues will be a crucial element for governments to deliver more of these essential services and, in turn, reduce poverty. Policymakers will have an opportunity to exchange views on the challenges of Revenue Mobilization in Sub-Saharan Africa at a conference in Nairobi this week. To help frame that conversation, here are some ideas about priority areas for action.
The IMF has begun implementing a new approach to financing its technical assistance by creating a series of topical trust funds that bring together interested donors. The idea behind the new topical trust funds is to support broader initiatives on policy topics and engage donors on a broader, longer-term, and more strategic basis.