Domestic Resource Mobilisation (Reflections from the 2026 Annual Meetings of the IMF and WBG)
Economic growth does not equate to economic transformation. From the domestic resource mobilisation (DRM) perspective, civil society raised concerns that the IMF focuses heavily on figures. During the meetings, there was a lot of discussion about Africa’s development and growth, supported by broad statistics. However, economic growth does not always reflect people’s lived realities. Civil society called for greater attention to what these figures mean for people on the ground.
Shocks were discussed extensively during the meetings. The IMF highlighted climate shocks and epidemics, including the rise of Ebola, and their effects on countries’ revenue mobilisation. However, the discussions did not adequately address how countries can mobilise revenue amidst increasing debt pressures and vulnerabilities. These pressures can leave countries with a limited fiscal space and little room to raise revenue.
One proposal discussed was the use of automatic debt suspension clauses, which could pause debt payments when a country is hit by a shock. Countries also need to prepare for shocks in advance. From a domestic resource mobilisation perspective, they should not have to wait for a crisis before taking action. They need to set aside resources in advance, including funding for climate shocks and other emergencies, and account for these in their budgets. Social protection is also very important. Countries need sufficient budget resources to support their citizens, and citizens should be able to participate in budget-making processes to help ensure that social protection funding is protected and there are floors in terms of what is allocated for social protection.
Investment was also a major topic during the Annual Meetings. The World Bank emphasised investment, especially in manufacturing, to create jobs and revitalise economies. Civil society asked what kinds of investment were needed, and significant attention was given to the private sector. However, civil society raised concerns about relying on private capital as the solution for mobilising investment. Private sector funding can bring challenges, and African countries should not have to depend on it alone. The World Bank’s message was that African countries do not have enough resources and therefore need private sector funding. We believe this is a misleading narrative, because countries can mobilise resources, for example, from their own mineral wealth. The continent has abundant minerals
The African Union also placed at the centre of its call and key recommendations, the use of revenues from Africa’s existing resources to support growth and transformation. The African Union also emphasised the importance of using institutions that are already in place. These include the African Continental Free Trade Area and the monetary institutions established by the AU. The discussions highlighted the need for political will to make these institutions functional and operational at the national level. This would also support revenue mobilisation across the continent.
Progressive taxation was another important issue. Conditionalities can lead countries to introduce regressive taxes on everyday goods and services, including bread and sugar. The discussions called instead for progressive tax measures, such as taxing wealthy individuals and ensuring multinational corporations pay their fair share of taxes. This would help shift the tax burden away from ordinary people.
It is also important that as we protect social protection budgets, we also protect direct funding toward productive sectors especially amid increasing domestic borrowing. Governments should invest in productive sectors and ensure they receive adequate support and funding.
Negotiations on the UN Framework Convention on International Tax Cooperation are ongoing, and the key message to the UK, as it takes on the G20 presidency, was not to dilute the process but to support it. The same message was directed to the IMF. The convention matters because the protocols under negotiation address issues such as carbon-related illicit financial flows, equitable taxation rights, fair allocation of taxing rights, especially in relation to multinational corporations and government responsibilities. The Framework Convention on Tax could be a game changer.
For civil society organisations, the message was to ensure the negotiations are not diluted and to secure strong political support from our governments and countries in the Global North so the process can succeed and the convention can be established.
Transcribed, edited and adapted by: Howard Mwangi, Campaigns and Communication Officer
Source: Diana Mochoge, Policy, Advocacy & Research Officer, Domestic Resource Mobilisation