LocationsUNLEASHING A NEW ERA OF AFRICAN DEVELOPMENT: UNDP and Government Collaboration
August 29, 2023
In the midst of an impactful transformation, African development efforts are undergoing a groundbreaking shift, fostering a fresh era of collaboration between governments and the United Nations Development Programme (UNDP). This change, marked by a stronger emphasis on domestic financing, signifies not just a shift in approach, but a dynamic leap toward achieving the Sustainable Development Goals (SDGs) and cultivating a more just and prosperous future for the continent.
Historically, UNDP's funding heavily relied on contributions from a few developed economies, highlighting the need for diverse funding sources. However, recent years have witnessed a substantial shift, as African nations channel their domestic resources into UNDP initiatives.
At the core of this resurgence is the concept of direct government funding to UNDP development programmes. The remarkable 321% increase in government contributions, soaring from $67 million in 2019 to $215 million in 2022, underscores the significance of this movement. Importantly, this surge is not confined to individual nations; it has spread across the continent, signifying a robust response to the prevailing challenges.
In an impressive turn of events, government funding has become the second-largest UNDP funding source for the Africa region in 2022, surpassing traditional donor funding. The substantial rise in contributions from countries like Cameroon, Tanzania, and DRC signals a new era of government-led development.
This partnership transcends mere financial transactions; it's a fusion of minds, capabilities, and vision. UNDP's agility empowers it to navigate bureaucracy swiftly and execute programmes efficiently. This operational finesse lays the foundation for fruitful collaboration, ensuring projects align with government strategies and fortifying local institutions. At the center of this partnership also lies UNDP’s strategic support in terms of the rationalization of budgetary choices, the efficiency of public expenditure, and the support for the quality of public procurement through the INFF initiative – the Integrated Framework for financing the SDGs.
This partnership transcends mere financial transactions; it's a fusion of minds, capabilities, and vision. UNDP's agility empowers it to navigate bureaucracy swiftly and execute programmes efficiently.
The shift towards government financing is also a response to the changing landscape of development financing in Africa. Over the past decade, African governments have reduced their reliance on aid for development. National budgets have emerged as the principal source of development financing and interventions across the continent. In 2021, African countries allocated over $570 billion of their domestic resources to fund development interventions, far surpassing the $64.8 billion from Official Development Assistance (ODA). The sums invested from domestic resources for development significantly exceed those from ODA or remittances.
This shift in funding approach is driven by a combination of endogenous and exogenous factors. Governments are more inclined to invest in development using their own fiscal space due to increasing pressure to deliver results that satisfy their populations and ensure equal access to services across the country. Failure to meet these demands has been shown to lead to destabilizing public manifestations. This internal pressure places a higher premium on effective governance and equitable resource allocation.
In this new era of African development, the focus extends beyond funding mechanisms. Governments are strategically investing their domestic resources to unleash transformative changes across the continent. These investments align with overarching objectives, including:
Transitioning from an extractive economy to a transformative value-add economy, fostering sustainable economic growth and reducing reliance on finite resources.
Building human capital through innovation and leveraging the youth bulge, recognizing the potential of Africa's young population as a driving force for positive change.
Strengthening resilience to climate change and investing in just energy transition, acknowledging the urgency of addressing environmental challenges to secure a sustainable future.
Establishing a developmental state anchored in good governance, where transparency, accountability, and effective governance systems lead to tangible improvements in people's lives.
Moreover, this dynamic shift also encompasses the evolution of Foreign Direct Investment (FDI), reinforcing the structural transformation underway on the continent. The progress of FDI opens up opportunities for public-private partnerships (PPPs) across various sectors, including mining, agribusiness, infrastructure, and tertiary and quaternary sectors. This engagement of private capital brings with it requests from emerging countries, particularly from South-South Cooperation, for strategic and structuring support in crucial areas such as governance, blue and green economy initiatives, vocational training, employability, protection, and human security.
Governments are strategically investing their domestic resources to unleash transformative changes across the continent.
UNDP, along with other UN agencies, plays a pivotal role in assisting the decentralized process of planning, strategic programming, and the enhancement of human capital. Our contribution to the development of policies and strategies, at national or sub-regional levels, serves as a major asset for establishing PPPs and increasing the combined attractiveness of internal and external funding.
While the global focus has primarily centered on the financing gap to achieve the SDGs, there has been less attention on the challenge of implementation on the continent. The COVID-19 pandemic has exposed the limitations of investment from national budgets and development aid without commensurate achievements on the ground, especially in the health sector.
Indeed, the financing gap is a pressing concern, as highlighted by the IMF's latest regional economic outlook for sub-Saharan Africa in April 2023, which refers to the funding constraints caused by higher global interest rates, sovereign debt spreads, and exchange rate depreciations. This challenge compounds the policy struggles arising from the COVID-19 pandemic and the cost-of-living crisis.
At the same time, the existing international financing system and the burden of crippling debt for some countries are proving increasingly inadequate in addressing the complex contemporary challenges faced by African nations. The status quo calls for reforms to counter debt distress and move toward more equitable, fair, and sustainable financing models. The current approach often shackles nations with heavy debt burdens, limiting their ability to invest in critical development initiatives and respond effectively to pressing challenges such as climate change and socioeconomic disparities.
However, financing alone will not be sufficient to achieve the SDGs without addressing the challenge of implementation. Governments face increasing pressure from their growing and predominantly young populations to deliver tangible results and concrete actions on the ground. With inefficient public spending estimated at USD 70 billion in Africa, evidence-based, efficient, prompt, and transparent implementation is increasingly a top priority in most African countries. UNDP has emerged as a crucial partner for governments, amplifying the impact of existing government budget allocations for developmental initiatives.
This paradigm shift in Government-UNDP Cooperation for Development holds immense potential to redefine African development. As governments shift from traditional donor funding to directing their budgets toward development initiatives, UNDP's role becomes catalytic. By magnifying the impact of government resources through strategic partnership, the stage is set for a remarkable journey toward sustainable and meaningful outcomes.
In the face of pressing challenges such as poverty, food insecurity, and funding constraints, effective implementation of development initiatives takes center stage. UNDP's ability to deliver tangible results, both during crises and in regular contexts, positions it as a reliable ally for governments striving to accelerate transformative development interventions, particularly in remote and rural areas.
This paradigm shift in Government-UNDP Cooperation for Development holds immense potential to redefine African development.
In conclusion, this transformative phase of UNDP-Government partnerships in Africa ushers in a promising era of shared determination to realize the SDGs. As UNDP's collaboration with governments deepens, it becomes evident that their collective efforts hold the key to overcoming challenges and driving impactful change on the continent. With Africa's focus on harnessing domestic resources and international support for resilient progress, the alliance between UNDP and African governments shines as a beacon of hope and promise. As we move into the future, this strategic alliance promises to be a guiding force, steering Africa toward a future of sustainable development and prosperity for all.