As the 2025 G20 Summit approaches, African leaders and policymakers are intensifying calls for stronger domestic resource mobilisation (DRM) to finance the continent’s development in the face of shrinking aid, rising debt, and persistent inequality.

At the Fourth International Conference on Financing for Development (FFD4) earlier this year, global leaders highlighted a $4 trillion annual shortfall in achieving the United Nations Sustainable Development Goals (SDGs). Africa accounts for $1.7 trillion of that gap amounting to 40 percent of the global deficit underscoring the urgency for new financing strategies with just five years to the 2030 deadline. 

Financing the SDGs

In a statement issued by the African Tax Administration Forum (ATAF) highlights that progress toward the SDGs remains slow. A 2024 UN report found that only 17 percent of the 135 global SDG targets are on track to be met by 2030, with many others stalled or regressing. In Africa, food insecurity, hunger, and lack of infrastructure continue to hamper growth.

With Official Development Assistance (ODA) declining and borrowing costs climbing, experts say domestic taxation offers the most sustainable path forward. Africa’s tax-to-GDP ratio, however, lingers below the critical 15 percent threshold for development. A one percent increase could generate an extra $35 billion annually amounting to $350 billion by 2030.

Tackling Illicit Financial Flows

The statement indicates that efforts to raise domestic revenues are being undermined by illicit financial flows (IFFs), including tax evasion and trade misinvoicing, which drain billions from African economies each year.

The African Tax Administration Forum (ATAF), a member of the G20 Development Working Group, is advocating reforms ranging from stronger customs enforcement and broader tax bases to greater transparency and digitalization of tax systems.

“What we witnessed in Skukuza was more than a meeting, it was a collective recommitment to global solidarity.We are seeing a stronger voice from the Global South that is shaping the future of multilateral development cooperation.” said Josephilda Nhlapo-Hlope, Chairperson of the G20 Development Working Group.

South Africa, which currently holds the G20 Presidency, has made combating IFFs a central priority. The adoption of a landmark Call to Action on IFFs by the G20 has been described as a major step forward.

Gender Equality Through Taxation

Beyond revenue, DRM is also seen as a tool for social change. Women, who make up more than half of Africa’s population, remain disproportionately disadvantaged, earning 39 percent less than men on average and holding fewer leadership positions in tax administrations.

ATAF has launched the Women in Tax Network (AWITN) to promote gender-responsive taxation and increase opportunities for women in leadership. Currently, just eight out of 44 ATAF member countries are led by female tax commissioners.

Experts also argue that tax policies can help ease gender inequalities by funding healthcare, education, childcare, and social protection, areas that reduce women’s unpaid care burden and boost economic participation.

ATAF’s membership in the G20 Empowerment of Women Working Group (EWWG) ties Africa’s gender equality agenda to wider global reforms.

From Commitments to Action

The 2025 G20 Skukuza Development Ministerial Declaration cemented DRM and IFFs as central pillars of the development agenda. Africa’s challenge now is ensuring these commitments result in measurable change.

ATAF is set to play a key role in drafting the roadmap for the G20’s high-level principles on combating IFFs, while also leading Africa’s Revenue Action for Development in Africa (RADA) programme designed to boost self-reliance in financing development.

As world leaders prepare to gather in Johannesburg, the continent’s focus is clear: whether pledges made at global summits can be translated into the tangible resources needed to deliver schools, hospitals, and jobs for millions of Africans.

Written By: Jerry Laynumah Siakor