World Bank Group Stresses Effective Policy

The World Bank Group has underscored the need for fiscal authorities of governments in Sub-Saharan Africa to implement policies aimed at strengthening tax administration.

According to the World Bank, this includes technical capacity building among revenue authorities as well as transparent and efficient operating procedures in order to raise domestic revenue generation.

In a document released Monday in Monrovia during a press conference,the World Bank Group noted that efforts by policy makers to stimulate growth with macro-economic policies could exacerbate existing domestic economic weaknesses.

The World Bank Group stated that reforms to raise domestic resource mobilization should be high on the agenda of Sub-Saharan Africa’s policy makers, emphasizing that these policies need to strike a balance between maintaining policy space to fund social and public investment programs and stimulating aggregate demand through “countercyclical” short-term policy responses.

According to the Bank, this issue has become even more important as the global development agenda moves towards the achievement of proposed Sustainable Development Goals.

It said governments’ revenues in Sub-Saharan Africa are lower than those of other regions as tax revenues as a percentage of Gross Domestic Product (GDP) is about 15-16 percent in resource rich and non-resource-rich countries.

At the same time, the Group has indicated that improvements in the transparency and disclosure of budget expenditures that are legally binding in the long-term might be required along with a reduction of earmarked expenditure, adding, “the reprioritization of expenditures will help reduce unproductive expenditure.”

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