African Governance Outlook 2012

African Development Bank Group
African Development Bank Group
Year of publication: 

Over the last ten years, the African Development Bank has taken significant steps towards strengthening and solidifying governance activities as one its strategic priorities while deepening the awareness of governance as a crosscutting issue in Bank lending and non-lending activities. These efforts gained momentum with the launch of the Bank’s Governance Strategic Directions and Action Plan (2008-2012), whose thrust is to support regional member countries enhance accountability and transparency in the management of their public financial resources. Building on its experience and knowledge, and recognizing that governance is, more than ever, a critical factor for economic and social development, the AfDB has decided to launch the African Governance Outlook (AGO).

The AGO’s conceptual framework is based on a selected set of objective indicators on financial governance, and uses a political economy perspective to analyze the major factors that determine financial governance outcomes and their evolution trends over time. The tool carves out its niche by focusing on financial governance assessment and complements existing efforts by other development partners in Africa. It consolidates existing partnerships with key African institutions to strengthen the capacity of national and regional institutions to collect and analyze financial governance data.

It should be emphasized that AGO is carefully designed to add value and not undermine or duplicate existing African governance assessments. It has a unique capacity building dimension that stems from its methodological base. The approach of ensuring active leadership and ownership by national stakeholders focuses on self-assessment founded on local knowledge and a contextual appreciation of the dynamics of financial governance and, by extension, the broader political governance in a particular country.

The AGO’s emphasis on assessing African countries’ policy reforms in financial governance, and their institutional capacity to implement such reforms could not have been initiated at a better time. African countries, generally, succeeded in surviving relatively unharmed the recent financial crisis that swept across the world mainly because of the governments’ commitment to reforms. African countries need to continue with the necessary reforms and, more importantly, undertake periodic policy and structural reviews to strengthen their public financial management systems, procedures and practices. Moreover, sound financial and economic governance is a necessary condition to strengthen the trust of African citizens in their governments and to ensure the delivery of much needed public services.

There is now a general consensus that there is need for investment in financial management capacity at all levels in Africa—institutional, national and regional level—particularly in view of the changing global financial landscape. Capacity development is a process that requires perseverance and consistency. Human capital and financial institutions in Africa require such dedicated focus and the African Capacity Building Foundation is a key factor of this critical endeavour.