There is need to invest heavily in capacity building in managing critical areas such as taxation, rural agriculture, education, leadership and science and technology if Africa is to successfully implement its development plan known as Agenda 2063, according to the Executive Secretary of the African Capacity Building Foundation (ACBF), Prof. Emmanuel Nnadozie. Prof. Nnadozie, who was in the country for the recently-concluded 27th African Union Summit in Kigali, was speaking to The New Times’ Eugene Kwibuka and Ritah Mukamurenzi in an exclusive interview at which he highlighted the need for the continent to focus on investing in building capacities that are crucially needed to drive the continent’s development agenda. Excerpts;-
Would you introduce the African Capacity Building Foundation (ACBF); what it is and what it does?
The African Capacity Building Foundation is a Pan-African and international organisation that was created 25 years ago to help African countries and institutions address capacity challenges that were preventing them from achieving development potential.
Since its formation, ACBF has worked hard and invested almost 700 million dollars across the continent to try to build human capital through training programs and education, and also to create and support institutions that are necessary for policy making, policy implementation and for achieving development results.
It has also helped to support at the continental level the major institutions such as the African Union, NEPAD and the African Peer Review Mechanism and it has also supported all the African regional economic communities.
In many countries, including Rwanda, it has really invested quite big in creating critical institutions, supporting policy-making, empowering women and promoting regional integration across the board. In the past 25 years, ACBF has been a key technical partner of the African Union and building key capacity for development.
How powerful is ACBF to really help the entire continent and how many governments are supporting it?
ACBF has about 40 member countries from Africa but it also has membership from some non-African bilateral and multilateral institutions and countries. But ACBF has been present in about 45 countries where we have really invested in capacity building or supported capacity development in different ways.
So it is an organisation whose membership is mainly African countries and in fact our governing body which is the board of governors, the most important one, is made up of the ministers of finance, including Rwanda’s Amb. Claver Gatete and all the ministers of finance or planning from various countries on the continent.
They constitute the governing body of the foundation. So, in a sense, ACBF belongs to the African countries. Our goal is to make sure that all the 54 countries become members and pledge their support to the foundation so that we can support the capacity development needs.
Africa has its development agenda, the Agenda 2063. What critical capacity skills are needed for the implementation of this agenda?
There is a lot of capacities that are needed. Some of them come in terms of institutions that are needed, whose capacity needs to be strengthened whether it’s in terms of their structure, in terms of their rules and regulations or in terms of their organisational set-up and even their coordination mechanisms.
We have to strengthen those institutions so they can play their role. But there are also other kinds of capacities that we need, in particular the men and women who need some kind of expertise and skills to be able to really implement this agenda. The human capacity is also very important in implementing Agenda 2063.
But for ACBF, the most important category of capacity is what we call the soft capacities. These are capacities that are not always obvious. Top among these is leadership because if you look at every place where there is success or there is progress, especially at country level you’ll see a visionary leader, an accountable leader who basically makes sure that the right policies are made and implemented.
The issues of mindset are also important and these are the sort of capacities that we feel that we need to pay attention to because they are critical for implementing agenda 2063.
Most of these things are learnt over a long time. Do you feel that there is need for our schools to also intervene and make sure that those capacities are built in schools?
No, when it comes to human capacity that’s what we are referring to at ACBF and as I said before capacity goes beyond skills of humans and expertise of humans. But when it comes to skills in human capacity, yes, of course, the educational institutions and educational systems are central.
You have to make sure that you have the kind of educational systems that respond to the needs of the society, not the ones that are framed in theory that does not really educate people who are not able to either employ themselves or employ others.
In other words, what ACBF has done over time and which is the way we do business is to try to invest in capacity building programs whether they are at university level, at vocational education level, in government or civil society.
For example, here in Rwanda, you have the Institute for Policy Analysis and Research (IPAR), which was more less founded and funded by ACBF and you know that that institute has been playing a critical role in articulating policies for the government.
What we call evidence-based policies so that they can actually have the kind of policies that respond to real problems. And also build capacity for people who are working in government to become more competent in economic management and policy analysis.
We have also supported the capacity building department in Rwanda, the National Capacity Building Secretariat, which we funded for quite a long time and organised training programmes for different people there. We also helped in creating some of your higher education institutions here in Rwanda.
There is talk of the need to tailor the current education system in Africa to the economic needs of the continent. How much of a need is this?
I think it’s a major problem and it occurs at various levels. Many countries have not been able to adapt their educational systems to the current realities and education is something that needs to be dynamic, it has to reflect the realities that the society is facing at any point in time.
Also, you have this dichotomy where countries that even have high levels of highly educated university graduates still have a large percentage unemployed, which is also a serious problem and this is a symptom of an education system that is not responding to the needs of the society.
We have to address these problems by making sure that we create a platform for dialogue among the higher education institutions, the government and the private sector so that in developing curriculum they are going to be deciding how best we can do that so that you educate, you retain and you utilise.
Secondly, we have to pay attention to vocational education because we have been paying far too much attention to degrees from the universities and we have knowledge that is not necessarily going along with skills. Learners need to come out of schools when they can fix a car, build a house or fix electricity, etc.
Thirdly, the question of the Diaspora is extremely important. Countries need to have a well developed strategy for tapping into the Diaspora human capital and even their financial capital so that they can utilise that to address the problems that they have.
Let’s talk about empowering African women. Many of them are farmers living in rural areas. How are they being empowered to live a better life?
Well, it depends on who you ask but if you ask me, I would say we are not empowering them enough and if we do not empower women, especially in agriculture, I can assure you that all our development aspirations will not be achieved and the continent will never fulfill its growth and development potential.
It’s essential because agriculture is an area where women seem to be overrepresented especially in rural areas as you mentioned but this is agriculture that is often at subsistance level and that is also micro in nature and does not allow people to actually work themselves out of poverty.
They find themselves in a vicious cycle whereby any shock leads them into economic instability and insecurity and they can quickly lose everything. Therefore, there is need for an empowerment programme for women in agriculture.
Africa is losing billions in lost tax revenues, is Africa doing enough to stop illicit financial flows?
Illicit financial flows is a major problem for Africa and, unfortunately, many people do not realise how serious a problem this is. Each year Africa loses between 50 to 60 billion dollars that illicitly flows out of the continent. Now you ask yourself, what can 50-60 billion dollars do for the continent?
It would probably solve the infrastructure problem of the continent. It is far greater than all the official development assistance and Foreign Direct Investments (FDIs) that Africa receives. If you had that kind of money, the debt that Africa has would probably be wiped out.
How do we lose that money?
Well, it’s the thing they call illicit outflows, which means that it could be through business transactions but it’s mostly by multilateral and trade related activities. It could be through corruption-related activities and also crimes such as money laundering, human trafficking, terrorism and all kinds of transfers that are there or issues related to poaching.
But the greatest source of this problem is business activities conducted by multi-nationals in terms of tax evasion, tax avoidance, trade mispricing and various other things that they do to avoid taxes.
Then you have tax havens where companies can basically operate in a country for 20 years and each year they declare a loss so they’ll never go out of business but when you look at the overall net profit of the company they are making 50 per cent of profits every year.
There is also the practice of government and individuals who defraud their country through the national treasury and go and put it in some kind of hidden account in countries that don’t ask questions.
How do we counter this problem?
It’s a continental problem with a global solution because it takes two to tango in these financial flows. It has to be the source and the receiver. Africa seems to be the source for the most part. With the exception of a few countries, the majority of the other countries are the source of it and there are havens out there where it is received.
So, there has to be some kind of international arrangement that will help to do that but Africa cannot control those ones except by trying to mobilise international support on that.
But there are things that the continent can do on its own, such as seeing how it can put in place the rules and regulations on the laws that will tighten some of the loopholes that exist, especially in terms of tax systems.
It’s a problem because they don’t have the capacity to track it, whether it’s in the customs agency or in the central bank that monitors transfers or the revenue authorities that are supposed to monitor this. Countries have a big problem in capacities.
So the countries have to build a strong capacity system if they are to manage their economies?
Having the capacity to enforce it is another thing because if you have just one individual facing the cooperation that has 30 tax experts and lawyers and they give you this complicated tax report and you are trying to figure out what exactly this sophisticated document they have presented to you is. So it’s difficult for governments to monitor and master such things.
So, is the solution technical or political?
Both, as well as other dimensions such as an area of diplomacy because you have got to sensitise the countries that are receiving this sort of revenues for there to be transparency.