unctad.org | Economic Development in Africa Report 2007
Economic Development in Africa 2007
Book Information
Reclaiming Policy Space: Domestic Resource Mobilization and Development States
Full Report ( 122 Pages, 821.0 KB )


One of the most prominent objectives of the Millennium Development Goals is to have member States halve their levels of absolute poverty by 2015. But, Sub-Saharan Africa has been singled out as one region that is unlikely to meet this target. One of the reasons for this is its relatively low rate of economic growth.

To raise the growth rate and sustain it at the level that will allow African countries to halve poverty by 2015 requires a significant increase in the volume of foreign and domestic resources devoted to promoting overall development in general, and poverty reduction programmes in particular.

The objective of this year´s Report is to examine the potential of African countries to increase their total domestic financial resource envelope in order to reduce dependence on official development assistance (ODA), and diversify their development resources. A complementary objective is how to channel these resources to productive investments in order to increase their efficiency.

Most of the challenges to development in general and to domestic resource mobilization and investment in particular, are manifestations of market failures plaguing African economies. Addressing these challenges requires an appropriate "policy mix" or "diversity of policies" tailored to the specific situation of each country, rather than a one-size-fits-all approach.

The Report highlights the need for "developmental States" in Africa with the required policy space to design and implement policies that address their priorities and make optimal use of available resources in a way that leads to a virtuous circle of accumulation, investment, growth and poverty reduction.

The Report argues that it is only by reclaiming its developmental role that the African State could give true meaning to the rhetoric of "ownership" of economic policies. It, however, warns that state involvement in development should not be seen as repeating past mistakes, such as over-protection and interventionism.

  • Chapter 1 is a brief exposé of the salient issues involved in domestic resource mobilization within the context of African countries.

  • Chapter 2 examines the challenges involved in raising the level of savings in Africa and discusses how the savings raised could be used to finance productive investments as a basis for sustainable growth.

  • Chapter 3 delineates the characteristics of "developmental States" while examining their applicability to Africa. It argues that the necessary conditions are currently in place for African countries to tackle their developmental challenges within the framework of a "developmental State".

  • Chapter 4, the final chapter, distils some policy conclusions from the preceding discussions.


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