At the Heads of State and Government breakfast dialogue held at the African Union Commission headquarters in Addis Ababa, Ethiopia, on February 16, 2025, President John Dramani Mahama called on African leaders to prioritise tax compliance as a key strategy for closing the continent’s significant financing gap.
As Champion on African Union Financial Institutions, Mr Mahama highlighted the estimated $402 billion annual financing gap facing Africa until 2030, stressing the urgency of finding sustainable solutions.
He emphasised that boosting domestic resource mobilisation through improved tax administration, combating illicit financial flows, and fostering a culture of tax compliance were essential steps in addressing the gap.
“Addressing the financial gap requires a multifaceted approach,” Mr. Mahama told the gathering of Heads of State.
“We must focus on enhancing tax systems, combating illicit financial flows, and ensuring that every African citizen pays their fair share.”
In his address, Mr. Mahama also touched on the broader challenges threatening Africa’s growth, including climate change, geopolitical tensions, and health crises, which further strain the continent’s development.
He underscored the importance of making strategic investments in sectors like health, education, energy, and technology to tackle these challenges and reduce the financing gap.
“This gap is not just a number; it represents the unrealised potential of millions of Africans who depend on our ability to invest in critical infrastructure and services that will improve their lives,” President Mahama said.
Dr. Ngozi Okonjo-Iweala, Director General of the World Trade Organization (WTO), also addressed the dialogue, urging African leaders to reduce reliance on borrowing and focus on attracting sustainable investments to fund development.
She called for more innovative approaches to financing, such as leveraging Africa’s natural resources and pension funds to raise patient capital for long-term development.
“We must attract investments to Africa and ensure they are sustained for our development,” Dr. Okonjo-Iweala said.
“This is the path to unlocking Africa’s true potential.”
