Nigeria has called for stronger financial discipline, institutional efficiency and sustainable financing mechanisms to strengthen the African Union’s financial independence, proposing an ambitious $10 billion Peace Fund over the next decade.
Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele, made the call at the 27th Extraordinary Session of the AU Executive Council on Financing the Union in Accra, Ghana.
A statement by Senior Special Assistant on Communications & Press Secretary to the Minister of Finance and Coordinating Minister of the Economy, Maryann Duke, noted said that highlighting the Union’s funding challenges, the Minister noted that Member States currently finance only 25 per cent of the AU budget and contribute just 4 per cent of programme funding, against a 75 per cent target. He added that declining development assistance makes the case for stronger domestic financing increasingly urgent.
While expressing Nigeria’s support for the proposed AU financing option, Mr. Oyedele stressed that its implementation must be guided by three principles: discipline, efficiency and leverage.
On fiscal discipline, he advocated fewer, high-impact priorities, a credible medium-term fiscal framework and performance-linked spending ceilings.
He also urged the Forum of Finance Ministers F15 technical experts to validate projections that could raise Member States’ contributions to $779 million by 2031, almost four times the current ceiling, in view of prevailing fiscal constraints across the continent.
Addressing institutional efficiency, the Minister called for the elimination of 29 identified areas of duplication, estimated to cost the Union up to $36 million, alongside the implementation of audit recommendations and revenue generation from AU-owned properties.
On the AU Peace Fund, Mr. Oyedele reaffirmed Nigeria’s openness to the proposed $1 billion target but advocated a more ambitious $10 billion fund over the next decade, financed through Member States levies, philanthropy and African capital.
He proposed managing the Fund along sovereign wealth fund principles, with investment returns providing sustainable financing for peace initiatives across the continent.
He also called for the retention of the interest-only rule until a sustainable replenishment mechanism is established, cautioning against depleting the Fund’s principal.
Member States with outstanding contributions were urged to fulfil their commitments within an agreed timeframe.
The Minister stressed that Africa’s sovereignty must be backed by financial independence, noting that a Union that is dependent on external funding risks losing control over its priorities.
He called for the Accra session to produce a concrete implementation work plan, including directing the AU Commission to eliminate institutional inefficiencies and report progress by the 2027 mid-year session.
He also urged the F15 experts to fully cost the proposed option and explore alternative financing arrangements, while the Commission develops sustainable options for replenishing the Peace Fund.
Mr. Oyedele reaffirmed Nigeria’s commitment to supporting reforms that promote fair burden-sharing, responsible financial management and a financially sustainable African Union.
