Financing the MDGs
Does the sustained global demand for oil, gas and minerals mean that Africa can now fund its own MDG financing gap?
Mobilising domestic resources in Africa: a strategy for meeting the MDGs
Authors:
; ODI
Publisher:
Overseas Development Institute, London, 2005
A new briefing note from the ODI explores ways in which "windfalls" from natural resources such as oil, metals and minerals can be channelled effectively into development processes towards meeting the MDGs. It notes that some African countries may be closer to funding the gap between inflows of aid and investment, and what is needed to meet the MDGs. However, mobilisation of these assets is curtailed by a lack of absorptive capacity and the realities of the "natural resource curse". It argues for a strategic re-think on how some of the $25 billion/annum of commitments of new aid to Africa by the G-8 and others might be deployed to overcome these constraints, with the aim of mobilising domestic windfall revenues to deliver the MDGs.
The paper proposes three strategies:
- align technical assistance for general budgetary support to the MDGs with windfall revenue management
- for other natural resource exporters, design new forms of technical assistance to mobilise domestic windfall revenues such that these revenues behave as though they were general budget support
- work with African institutions to incentivise some of the capital surplus from windfall countries to be channelled to productive MDG and extractive industry investments across borders within the region.
