Wale Edun, Minister of Finance and Coordinating Minister of the Economy, has called for urgent fiscal reforms to tackle illicit financial flows across Africa. He made the appeal on Tuesday at the opening of the fifth session of the African Union Sub-Committee on Tax and Illicit Financial Flows, part of the Specialised Technical Committee on Finance, Monetary Affairs, Economic Planning and Integration, held in Abuja.
Edun emphasized that Africa is at a critical juncture, requiring bold and decisive action to unlock its economic potential and strengthen domestic resource mobilisation. “Africa’s over 1.4 billion population and vast resources can only translate into prosperity through effective mobilisation and management of domestic financial resources,” he said.
He noted that global shifts in trade, finance, and cooperation frameworks have reinforced the need for African countries to depend more on their internal institutions and capacities. Sustainable development, Edun argued, cannot rely solely on debt, aid, or foreign investment but must be built on strong domestic resource mobilisation, aiming to finance up to 90 per cent of development needs internally in line with the African Union’s Agenda 2063.
Highlighting the challenges, he said illicit financial flows cost the continent about $88 billion annually, depriving critical sectors such as healthcare, education, and infrastructure of essential funding. Other hurdles include tax evasion, weak institutional capacity, limited economic diversification, and continued reliance on external financing.
Edun stressed that Agenda 2063 provides a roadmap for reform through improved tax systems, enhanced governance, financial inclusion, capital market development, and measures to curb illicit financial flows. He cited Nigeria’s efforts under President Bola Tinubu, including tax policy reforms, removal of fuel subsidies, exchange rate unification, and improved transparency in oil revenue management, which have strengthened fiscal discipline and investor confidence.
He also noted the introduction of the National Single Window system in Nigeria to enhance trade efficiency and reduce leakages linked to illicit financial practices, resulting in improved non-oil revenue performance, stronger fiscal buffers, and enhanced international cooperation in tracking illicit flows.
Edun urged that Africa’s fiscal reform priorities include broadening the tax base, strengthening public financial management, promoting domestic savings, and expanding financial inclusion. He called for robust capital market development and cross-border collaboration to combat illicit financial flows effectively.
“Successful reforms will enhance economic stability, reduce vulnerability to external shocks, and create fiscal space for investment in critical sectors. African leaders must demonstrate courage, discipline, and collective responsibility to drive inclusive growth and long-term development,” he said.
