A few countries in Africa have taken significant steps in tackling corruption, with some outflanking developing business sector and, surprisingly, high level economies.
A new book by the International Monetary Fund (IMF), Good Governance in Sub-Saharan Africa- – features three countries — Botswana, Rwanda and Seychelles — that are driving in the work to improve governance. A board conversation directed by Deputy Managing Director Antoinette Sayeh, was coordinated as a feature of the virtual launch.
In an interview with Country Focus, Ms. Sayeh, who was in Botswana last week for a significant level meeting on the advancement of good governance, and the editors of the book, Monique Newiak, Alex Segura-Ubiergo and Abdoul Aziz Wane, discuss their discoveries and the importance of transparency and public honesty for the region’s developments.
The Elements Of Good Governance By Antoinette Sayeh:
The most successful countries usually have five key elements in place. First, a high level of political commitment to good governance and transparency. You can see that in several ways: by how a country’s budget is formulated and presented; by the degree of independence of the central bank; and whether there is a commitment to declaring the assets of key public officials and publishing audits.
Second, respect for the rule of law and property rights. When foreign investors invest in a country, they do so, knowing that the government will respect the contracts, and property rights will be enforced.
The third element is ensuring efficiency, transparency, and public oversight of investments. This is especially crucial given the need to scale up public investment in infrastructure in Africa. The book points to studies that show that when there is not enough government oversight of public procurement processes, project costs tend to be higher.
Fourth, access to information, which I’ll let Alex talk a little more about.
And finally, innovation and technology, which we believe can play a big role in helping governments deliver on these priorities.
As per Antoinette Sayeh, poor governance and corruption have a negative impact on economic growth. They distort public spending and undermine domestic revenue mobilization – an estimated tax revenue losses globally of US$1 trillion. Which is why the Fund has been working with countries on this issue for over 20 years.
And now, at a time when the world faces multiple crises—the COVID-19 pandemic, the war in Ukraine, and the ongoing challenges of climate change—the need for good governance has become more urgent. It’s about more than wasting money; good governance enables growth.
Our efforts focus on reducing vulnerabilities to corruption by strengthening governance in six core state functions: central bank governance, financial sector governance, fiscal governance, market regulation, rule of law, and anti-money laundering.
In addition to the policy advice we offer, we work closely with countries and development partners to develop and implement comprehensive governance reform strategies. Much of this effort is coordinated by the IMF’s network of 17 capacity development centers around the world, six of which are in Africa.
Alex Segura-Ubiergo details the benefits of tackling corruption. According to him, you can do so by making more information available to the public. Access to information facilitates accountability—a key precondition for good governance. When governments produce, gather, and disseminate information, decisions are more transparent, citizens are better informed, and institutions and civil society organizations can hold governments to account.
Second, by ensuring that the tax burden is distributed equitably, and public spending is focused on achieving faster progress toward meeting the sustainable development goals: reducing poverty, increasing access to health and education, and protecting the environment. When citizens perceive that governments are using public resources well, they are more likely to view their tax obligations as legitimate.
Third, by having political leaders that set an example with their actions: publishing their assets and creating incentives to fight corruption with the assistance of an anti-corruption agency and the court system. Together, these create a governance dividend: higher and more inclusive growth through stronger and more transparent institutions that increase accountability.
More generally, digitalization can have a crucial impact on institutions. IMF’s book documents how strongly institutional quality and e-government are interrelated and how digitalization can reduce the perception of corruption. Digital reforms to enhance institutional quality can make a difference but it is important to sequence them, including by prioritizing education, to ensure people benefit.
The pandemic highlighted the need for greater transparency and oversight in how emergency funds are spent.