The African Development Bank AfDB’s Chief Economist and Vice President for Economic Governance and Knowledge Management Kelvin Urama, has suggested that Africa could mobilise more than $469 billion in additional annual revenue without increasing statutory tax rates, arguing that improved efficiency and stronger compliance, not higher taxes hold the key to financing the continent’s development.

Urama made the declaration at a meeting in Abuja, where he urged Nigeria and other African nations to pursue deeper reforms in tax administration, public service delivery, and institutional governance.

“We see that by improving tax administration through digitisation and other reforms, just by adopting best practices, the continent can mobilise more than $469 billion extra without increasing tax rates. It is simply about improving efficiency and strengthening compliance,” Urama said.

He identified a central paradox undermining tax collection across the continent: many citizens self-finance basic services, electricity, water, and road infrastructure — that governments are expected to provide, leaving them with little incentive to fulfil their tax obligations voluntarily.

“Governments can improve voluntary tax compliance by delivering quality public services, strengthening transparency, and ensuring prudent management of public resources,” he noted.

Urama outlined a multi-pronged approach to unlocking the continent’s revenue potential, centred on digitalising tax administration, strengthening public institutions, and enhancing service delivery. He said the AfDB was already supporting Nigeria and other member states in building the capacity of national revenue authorities toward these ends.

The bank has also developed a Public Service Delivery Index designed to encourage governments to raise service standards and deepen the social contract between the state and its citizens, a relationship Urama described as foundational to sustainable tax compliance.

Beyond the immediate revenue gains, the AfDB economist stressed that stronger domestic resource mobilisation carries broader strategic importance for the continent, warning that over-reliance on external financing leaves African economies vulnerable.

“Stronger domestic resource mobilisation would reduce excessive dependence on external financing and provide countries with greater fiscal space to pursue development priorities,” he said.