CABRI has had a busy start to 2025! Our 2024-2025 Building Public Finance Capabilities (BPFC) programme concluded with a fireside discussion on unfolding global events and initial reactions thereto with country-team authorisers from Guinea and Mauritius. Over the last quarter CABRI also engaged on regional platforms such as the African Union event in collaboration the with Pan African Federation of Accountants and the United Nations Development Programme High-level Regional Dialogue on Public Finance Systems in Africa.

The privilege of an African perspective is an intrinsic understanding of the need for improving opportunities for the populace, and of the toll that compliance with international requirements can take in terms of country sovereignty – manifest indeed in the very ability to govern and control a country.

While this can be viewed from many perspectives, and especially more recently may be attributed to exogenous phenomena perpetrated by nations that are global economic powerhouses, this may seem therefore largely to render any specific country defenseless in the wake of the political power play of global giants. Purposeful focus, domestically and regionally, on public finance management is needed.

There are many things to lament about from an African perspective:

Most low-income and developing countries have experienced a decline in their economic growth rates over the past two decades. Medium-term growth projections are estimated to be lower than growth after the 2008 financial crisis. Countries are presently dealing with unprecedented fiscal pressures.

In addition to a historic situation of limited capacity for revenue mobilisation, with pressing needs for spending on necessary public services, the COVID-19 pandemic increased the general level of country indebtedness. The pressure to repay historic debt remains. Yet, many countries cannot afford to fund their own primary health sector needs annually.

More recently, various new macro-fiscal shocks - war and disease outbreaks - have and are increasing spending demands in the social sector, health, none the least of which are climate disaster and other events, all beyond the confines of country boarders. And yet, the terms of country borrowing and other forms of assistance are not as beneficial as they were a decade ago.

Most recently, this situation worsened with the sudden withdrawal of American development assistance. This situation is fast compounding. Some three months ago, was the shock of the announcement of the impending shutdown of the United States Agency for International Development (USAID) programme, followed immediately by its closure across countries. The immediate and rational first response of African countries, was to identify and quantify the risk. Firstly, the direct risk in terms of areas of the country budget affected and the impact on other domestic sectors.

Now, as the indirect effects in terms of the impact on the broader global financial architecture and development aid contexts were being deliberated upon, news broke of substantial reductions in development aid announced by various donor nations across the globe, as newly elected governments take charge. Within the last week, we have witnessed a global trade war ensue, albeit with a pause on the implementation of US tariffs announced overnight.

From an African perspective, it is apparent that there are future traps to avoid:

• Collective action must be taken by African countries – together, we must invest in our own knowledge, skills and resources and decide on terms of borrowing or assistance.
• Exiting providers of development assistance should not be simply replaced by new donor nations and partners - countries must make every effort to reduce their annual country budget deficits and accumulating debt.
• Country systems should be used by partners and be developed - reducing the risk currently faced of non-access to administrative and other information upon withdrawal.
• Technical public finance management international standards and practices should be reviewed – to ensure that local context is considered in the adherence to good practice to avoid unintended consequences and mistaking control for governance and accountability.

In essence, country public finance systems must be re-assessed for functionality, focused with intention domestically on all spheres of government and other stakeholders and for the purpose of leveraging collaboration and cooperation on the continent and regionally. Without in the least dismissing the importance of the macro-fiscal reforms needed, in addition to top-down budgeting fiscal discipline, there must be purposeful focus on bottom-up budget provisioning for frontline sector service delivery to citizens.

Building public trust means being directly accountable to citizens. To do so, countries must trust their own domestic financial architecture and processes, their own human resources, and ultimately, their own decision-making. In the domestic domain, countries have more control in administration and sector service delivery than they are currently leveraging.

CABRI is privileged to do much in-country work across the continent. One example follows our Policy Dialogue last year in Mauritius which attracted participants gathered representatives from 13 African ministries of finance and ministries of health. There is a growing consensus that direct financing and financial autonomy for health facilities are impactful. Evidence suggests that autonomy in financial decision-making at the frontline enhances efficiency in the allocation and spending of funds on health services delivery, strengthens transparency and accountability, improves responsiveness to local community needs, and results in better and more equitable health outcomes. Whilst ministries of finance can be reluctant to increase facility financial autonomy for fear of loss of their oversight and financial control, the fiscal architecture system and processes put in place seem not to be not neutral in their impact on service delivery.

Country experience is that pragmatism is required. For smaller facilities, USD 500 a month could be sufficient to cover basic operational expenses, which would not pose any major fiduciary risk or threaten country fiscal discipline. More accountability is not necessarily always facilitated by more controls and accountability and control should not be conflated. Rigid ex-ante spending controls should not be routinely imposed without consideration of the local context, as this induces risk. In reality, unproductive controls sometimes force people outside of the health and other systems, undermining accountability.

Collective action across the continent is needed to ensure that we leverage our demographic dividend by using our intrinsic understanding of our context, and our human and other resources. Appeals to global benevolence will not be self-sustaining. To build public trust, we must purposefully plan a future together and be accountable for it, using all the public finance management tools we have put in place and use them for this express purpose.

Whilst the founding members of CABRI had the vision of building an African peer network of member states for the collaborative development of impactful public financial management reform, the intensity of the speed and impact of current global changes could not have been anticipated.

Past CABRI network and country public finance reforms and collaboration must now be amplified collectively.