African Union (AU)

Call to Action: “Now or Never” by H.E. Thabo Mbeki, 21 November 2022

Combating Illicit Financial Flows : “Now or Never”

Statement of H.E. Thabo Mbeki, Chairperson of the African Union High Level Panel on IFFs

“I fully support the creation of a globally inclusive, intergovernmental process at the UN. I urged all international organisations and Member States to resist attempts to block this important step forward, and thus call into question our global commitment to fighting illicit financial flows and corporate tax abuse in support of the Sustainable Development Goals.”

* H.E. Thabo Mbeki is also the Chair of the Board of the South Centre.

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Documento de Investigación 156, 1 de junio de 2022

¿Una elección difícil? Comparación de los ingresos fiscales que recaudarán los países en vías de desarrollo a partir de los regímenes del Monto A y del Artículo 12B de la Convención Modelo de las Naciones Unidas

Por Vladimir Starkov y Alexis Jin

En este documento de investigación, pretendemos calcular los ingresos tributarios que obtendrán (o perderán) los Estados miembros del South Centre y la Unión Africana con arreglo a los regímenes del Importe A y del Artículo 12B. En nuestro análisis hemos recurrido a fuentes de información disponibles para el personal investigador del sector privado, aunque no ha conllevado el examen de ninguno de los datos que los contribuyentes proporcionan a las autoridades fiscales. Nuestra investigación demuestra que los efectos comparativos en los ingresos obtenidos con los regímenes fiscales del Importe A y el Artículo 12B dependen en gran medida de a) los detalles de diseño del régimen del Artículo 12B; b) si el país es sede de empresas multinacionales que puedan estar dentro del ámbito de aplicación de los regímenes fiscales del Importe A o del Artículo 12B; y c) la desgravación a partir de la doble tributación, de haberla, que conceda el país a los contribuyentes nacionales sujetos al pago de tributos en virtud del régimen del Importe A o del Artículo 12B.

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South Centre Comments on Progress Report on Amount A of Pillar One, 18 August 2022

South Centre Comments on Progress Report on Amount A of Pillar One

The South Centre offers its comments to the OECD Inclusive Framework’s Task Force on Digital Economy (TFDE) on the Progress Report on Amount A of Pillar One.

In June 2022, the Coalition for Dialogue on Africa (CODA), a Special Initiative of the African Union, and the South Centre, jointly released country-level revenue estimates from Amount A compared with Article 12B of the UN Model Tax Convention, for the 84 combined Member States of the African Union and the South Centre. CODA and the South Centre have also provided a set of recommendations to developing countries on the taxation of the digitalized economy.

The Progress Report on Amount A, the latest version of the OECD’s proposed solution for taxation of the digitalized economy, makes it clear that the revenues expected for developing countries will dwindle even further than estimated by CODA and the South Centre.

With each successive update of the rules, the proposed solution is becoming increasingly less appealing to the developing countries. The OECD must, at a minimum, release revenue estimates for the 141 jurisdictions of the Inclusive Framework such that each can take an informed decision in the national interest. As an organization that sets ‘transparency’ standards, OECD must itself be transparent and provide countries with the essential information needed for making what may become a historic decision for the international taxation regime.

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Document de Recherche 156, 1 juin 2022

Un choix cornélien ?

Comparaison des recettes fiscales à engranger par les pays en développement au titre des régimes du Montant A et de l’Article 12B du Modèle de convention des Nations Unies

Par Vladimir Starkov et Alexis Jin

Le présent document de recherche se propose d’estimer le montant des recettes fiscales qui seraient engrangé (ou perdu) par les pays membres du Centre Sud et de l’Union africaine dans le cadre de la mise en œuvre du Montant A et de l’Article 12B. Notre analyse s’appuie sur des sources d’information accessibles aux chercheurs du secteur privé et non sur les informations communiquées par les contribuables aux autorités fiscales. Elle démontre que les effets comparatifs sur les recettes de la mise en œuvre du Montant A et de l’article 12B dépendent en grande partie (a) des détails de conception du régime mis en place par l’article 12B, (b) du fait que le pays accueille ou non le siège d’entreprises multinationales susceptibles d’être imposées au titre du montant A ou de l’article 12B, et (c) de l’allégement éventuel de la double imposition qui sera accordé par le pays aux contribuables nationaux imposés au titre du Montant A ou de l’article 12B.

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Research Paper 156, 1 June 2022

A Tough Call? Comparing Tax Revenues to Be Raised by Developing Countries from the Amount A and the UN Model Treaty Article 12B Regimes

By Vladimir Starkov and Alexis Jin

In this research paper, we attempt to estimate the tax revenues to be gained (or lost) by the South Centre and African Union’s Member States under the Amount A and Article 12B regimes. Our analysis relied on sources of information available to private sector researchers but did not involve review of any information that taxpayers provide to tax authorities. Our research demonstrates that the comparative revenue effects of the Amount A and Article 12B taxation regimes largely depend on (a) design details of the Article 12B regime, (b) whether the country hosts headquarters of MNEs that may be in scope of Amount A or Article 12B taxation, and (c) what relief from double taxation, if any, the country will grant to domestic taxpayers subject to taxation under either the Amount A or Article 12B regimes.

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SouthViews No. 230, 25 November 2021

The Place of Multilateralism in Tax Reforms: Exclusionary Outcomes of a Purported Inclusive Framework

By Alexander Ezenagu

Countries have come to accept the wide application of international tax rules in both their domestic and international tax affairs. However, where international tax rules fall short of the legitimate expectations of countries and fail to provide necessary guidance, countries may be compelled to seek other sources of guidance. In this paper, it is argued that in the absence and failure of international tax rules to provide adequate guidance and encourage a fair tax system, countries should not be prohibited from exercising their fiscal sovereignty.

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SouthViews No. 222, 12 July 2021

Development Priorities for Africa in 2021 and Beyond

By Judith Amelia Louis

The author posits that Covid-19 is not the only major problem facing the global South and Africa in particular, although it is the most pressing for the times 2020-2021. The writer attempts to present important priority areas for attention by policymakers and decision makers at the national and regional levels in Africa within the context of the Covid-19 pandemic.

The paper recognizes that the social, economic, and political problems facing Africa are common to all its nation States and calls upon the African Union to play a more proactive role in shaping policy programs to address these persistent problems, including the crafting of statesmen genuinely committed to ‘people-centered development’.  The article discusses the issues impacting select priorities of socio-economic welfare; improved governance; human capital investment; regularization of migration and stemming the ‘brain drain’. Suggested policy actions are prescribed as solutions towards achieving development. Urgent action in controlling their economies with the acquisition and retention of requisite skills and technology is the undertone of the paper given the picture of poverty characterizing basic needs data for the continent. For example, in the health sector there are shortages of medical personnel, a situation magnified by the Covid pandemic.

The author envisions Africa’s development utilizing its vast untapped potential including, inter alia, a young population.

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Investment Policy Brief 22, June 2021

Investment Policy Options for Facing COVID-19 Related ISDS Claims

By Daniel Uribe and Danish

Developing and least developed countries have undertaken a number of measures to fight against the multidimensional impacts of the COVID-19 pandemic. Such measures and those that may be adopted in the context of the recovery efforts are, however, susceptible to challenges by foreign investors using investor-State dispute settlement mechanisms.

This policy brief first considers the kinds of measures States have adopted to limit the spread of COVID-19, protect their strategic sectors and promote economic recovery, including through foreign investment aftercare and retention. It then addresses how the investor-State dispute settlement system (ISDS) has been used by investors in times of crises, based on the analysis of the awards in several cases brought against both developed and developing countries.

Against this backdrop, the brief elaborates on the different options and initiatives States can take for preventing ISDS claims at the national, bilateral, regional and multilateral levels. It concludes with some policy advice for developing and least developed countries to face possible COVID-19 related ISDS claims in the future.

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SC Webinar Series: Powering Africa after Covid-19: Options for Energy

Webinar Series: Powering Africa after Covid-19: Options for Energy

 

Webinar 1: Carbon Trading: Panacea or Placebo for Africa’s Energy and Climate Policies?

Building on the first webinar series that took place in July 2020, this next series will focus on identifying the various energy and development options that are present for African policymakers, drawing on the policy
and technical expertise of African and international experts and policymakers.

The first webinar “Carbon Trading: Panacea or Placebo for Africa’s Energy and Climate Policies?” will investigate various perspectives about the potential use of carbon pricing and carbon trading mechanisms in Africa as part of its energy, climate and development policy mix. Experts from Africa and around the world will be invited to look into the challenges and opportunities that carbon pricing and carbon trading policies may have for Africa, drawing on previous experiences with respect to REDD+, the Kyoto Protocol’s Clean Development Mechanism, and other experiences, and on on-going policy discussions with respect to Article 6 of the Paris Agreement. Invited speakers for this webinar will be from the African Development Bank, African climate change policy implementors and civil society, and European and Chinese experts in their respective carbon trading regimes.

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SC Webinar Series: Energy for sustainable development in Africa in the post-COVID19 world – looking for the New Normal

Webinar Series: Energy for sustainable development in Africa in the post-COVID19 world – looking for the New Normal

Webinar 2: Sustainable Energy for Africa: transition through growth. How to boost output, improve access and reduce impact on the nature and society? Technologies, scenarios, strategies, sources of finance and business models.

Africa, particularly sub-Saharan Africa, has generally low levels of socio-economic development and energy usage. The COVID-19 outbreak and its consequent economic downturn present additional challenges and pose questions requiring urgent answers. Success of the pandemic measures depend upon, among other elements, on a strategic vision reflecting current situation and future uncertainties; and aligning interests of all stakeholders. In order to build such strategic vision, we have invited leading experts in our webinars to facilitate information gathering and to generate ideas for further work on strategies development and stakeholders’ engagement necessary for the continent’s energy transition in the post-COVID-19 world.

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Climate Policy Brief 22, February 2020

The Africa Energy Transition Program (AFRETRAP)

By Rajesh Eralil and Youba Sokona

In a more and more climate change threatened world, Africa’s energy vision should be premised on moving from an energy landscape based on underdeveloped and carbon intense pathways to a modern, clean and decentralized energy system. This transition is a critical enabler of meaningful and endogenous socio-economic development. While the continent may face a broad set of challenges in achieving this vision, it has at the same time the opportunity to avoid the fossil fuel lock-in that many industrialized countries face and to take advantage of vast supplies of untapped energy resources and/or any stranded asset problem. The Africa Energy Transition Program in the making under the auspices of the African Energy Commission forms a continent-wide and coordinated approach in facilitating the required transformation for the realization of Africa’s development aspiration.

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