The recommendations are contained in a new report titled Strengthening the Transparency, Sustainability and Efficiency of the Public Sector, which examines the country’s fiscal challenges and outlines measures to improve economic resilience, support human development and create conditions for sustainable growth.
According to the report, CAR has made some progress in recent years, aided by improvements in security and advancements in public finance management. However, significant structural fragilities remain.
Domestic revenue collection remains below 10% of gross domestic product, while the government wage bill consumes as much as 73% of public resources, leaving limited room for investment in development priorities. The report also highlights the country’s continued dependence on external aid and low levels of investment in critical sectors such as education and healthcare.
World Bank Country Director Cheick Fantamady Kante said stronger revenue collection and improved financial management are essential to unlocking the country’s development potential.
“By strengthening domestic revenue mobilisation and public financial management, CAR can generate the fiscal space needed to invest in its human capital, public services, and lay the foundation for inclusive and sustainable growth,” Kante said.
The report identifies considerable potential to raise additional revenue, particularly through improved management of the forestry and mining sectors, modernisation of tax administration and stronger governance mechanisms.
To address existing challenges, the World Bank proposes a reform agenda built around five priorities: strengthening domestic revenue mobilisation through measures such as widening the tax base and digitising tax administration; improving cash and debt management; enhancing transparency and accountability in public procurement and state-owned enterprises; increasing spending on social sectors; and strengthening coordination with international development partners.
The report concludes that better management of public finances and stronger domestic resource mobilisation could gradually reduce the country’s reliance on external assistance while creating greater fiscal space for investment in development priorities.
It adds that these reforms would help create a more stable environment for private sector investment, support job creation and promote more inclusive and sustainable economic growth in the long term.
–WorldBank/ChannelAfrica–
