President Muhammadu Buhari has rightly called for a comprehensive reform of the structures and operations of the African Union (AU) to make it efficient and capable of meeting its targets and achieving its aims of establishment.
If the African Union fails to get reformed and become result-oriented, the president warned that it risks the chance of becoming stale.
Hopefully, it won’t be so-stale. After all, the point of African Unity has never been about rhetoric alone, but rather the practical need to work together to realise concrete improvements in the well-being and security of Africans which would be unattainable working as individual entities.
Nevertheless, the unfortunate truth is that Africa, today, is ill-prepared to adequately respond to current events, because the African Union, despite its achievements, still has to be made fit for that purpose.
Inefficient bureaucracy, lack of implementation and inadequate funding were among some of the main issues on the table in July 2016, when the 27th Ordinary Session of the AU Assembly of Heads of State determined that there was an urgent need to accelerate the ongoing reform of the African Union.
The President of Rwanda, Paul Kagame, was tasked with preparing a report on the way forward.
Appointing Kagame to propose and drive a new set of reforms was intended to provide the necessary political clout behind mooted changes to the functioning of the continental organisation.
Six months later, he presented ‘The Imperative to Strengthen our Union: Report on the Proposed Recommendations for the Institutional Reform of the African Union’ (the Kagame Report).
And, the truth is, there is no shortage of ideas within Africa about how to reform the AU and create prosperity for the continent’s peoples. But making the most of the opportunities ahead will increasingly require Africa’s economies to work together, and for its institutions to improve their governance and performance.
The AU has a key role to play in this, but it needs to be more effective. The institution has previously launched several reform initiatives that have eventually foundered because of a lack of implementation, thereby making the call now made by President Buhari valid and timely.
The Nigerian president spoke at the two-day 34th Summit of the AU held virtually.
“…global realities demand that the AU be overhauled, if it must remain relevant in intergovernmental processes. We must work concertedly to ensure a productive, self-sufficient and purpose driven organisation that will fully serve the interests of the people,” he said. “Nigeria demands a truly reformed, efficient and effective AU Commission, one that is fully committed to the discharge of its duties and responsibilities.’’
The president commended President Paul Kagame of Rwanda for presenting a special report on the need to reform the AU.
And, indeed, if the leaders in Africa are desirous of reforming the AU, the Kagame blueprint provides a way to begin. Kagame summed up the challenge neatly in a speech he delivered in Addis Ababa in January 2017.
Noting that the AU has had a history of good intentions that have not translated into change on the ground, he said: “Serious problems were repeatedly identified. Solutions were found. Decisions were made to apply the solutions. And very little happened.”
His blueprint for reforming the AU consisted of four key recommendations, one, enable the AU to finance itself in the long term, two, focus the organisation on key priorities with continental scope, three, realign AU institutions to deliver against those priorities and, four, manage the business of the AU effectively in both political and operational terms.
Only through sustainable long-term financing can the AU follow an independent agenda that speaks to common priorities. Today, over 80 percent of the funding of the AU comes from donors, but in July 2016 a breakthrough AU proposal to charge a duty of 0.2 percent on the import of eligible items from outside Africa that would enable the AU to be self-financing was approved.
This initiative, believed to be under implementation now, can be a proof that AU decisions can be followed through and have real impact. The challenge now is to move on with implementation of the other three priorities.
The AU’s proposed commitment to a smaller number of priorities, namely, political affairs, peace and security, Africa’s global representation and voice and economic integration represent a significant sharpening of the institution’s focus versus the status quo.
There is no doubt that huge economic and business opportunity exist within Africa. In fact, Africa is an opportunity for the world but it needs to overcome its current economic and political fragmentation to enable businesses to tap these large opportunities.
Consider that Africa today has eight different (partly overlapping) regional trade zones, but none of them includes more than half of Africa’s countries.
The two best-performing blocs are the East African Community and the Southern African Development Community, but they still only export 16 percent and 13 percent of goods, respectively, to trading partners within those blocs. For comparison, the equivalent figure in Association of Southeast Asian Nations (ASEAN) is around 20 percent.
Regional fragmentation hinders business activity and creates a fragmented, unproductive business landscape. The continent has few manufacturing and services hubs, which require scale to succeed.
While Africa is said to have 400 companies with annual revenues of above $1 billion when one excludes South Africa, this number is only 60 percent of the number one would expect. The average large African company has annual revenue of $2.7 billion compared with $4 billion to $4.5 billion in other emerging economies.
No African company is featured in the global Fortune 500. Brazil and India, whose GDPs are similar to that of Africa as a whole, each boast of seven companies on that list. Yet, large African companies are, on average, growing faster and are more profitable than companies of the same size in the rest of the world, suggesting enormous potential.
The unfortunate situation Africa finds itself in, like President Buhari and President Kagame pointed out, needs redressing with a view to having increased integration and cooperation that would help Africa build more of large companies, raise competitiveness and productivity and create more formal jobs that the continent desperately needs.
Undoubtedly, a reformed AU can help Africa and Africans grow stronger and better. Today, Africans need visas to travel to more than half the countries within the continent, it is easier for North Americans to travel within Africa than it is for Africans.
We have already seen the institution’s ability to take practical steps that bring down barriers to doing business across the continent with the African Union passport.
The new passport will help enormously and now needs to be made available to all eligible citizens as quickly as possible while many more steps need to be taken to encourage cooperation and movement as well as reducing the time it takes for goods to cross borders, lower tariffs between and among countries and driving closer integration of capital markets.
Ideally, too, the AU should identify continent-wide services such as the provision of neutral arbitration and competition services and a common technical platform for the data and analysis needed to assess progress toward Africa’s development goals.
Agreed, Africa faces many challenges, but the continent will not meet any of them without capable leaders, such as President Buhari, who have the vision, determination, skill and commitment to implement reforms.
Thus, practical measures to ensure effective implementation of the President Kagame’s report and the recommendations by President Buhari should be the priority. In this light, reforms to the AU’s leadership and working methods are, therefore, critical.
The AU deputy chairperson and commissioners should be competitively recruited, and there should be a fundamental review of the organisation’s structure and staffing needs.
Similarly, the AU’s Heads of State Summits should focus on not more than three critical items, with other appropriate business being delegated to lower levels within the AU.
Only with effective implementation will the AU play the vital role Africa needs and, as President Kagame put it, “set our people on a path to dignity and prosperity.”
