Investing in Africa: A Call for Action

During our last The Africa Roundtable conference in May 2022, accumulating capital to spur development and growth in Africa was discussed. For over a decade, the challenges of African countries have been thematized, but not yet specifically tackled. All participants of the debate concur on three critical ingredients for a sustainable recovery and growth in Africa: strong partnerships, the catalyzation of financial means, and innovation and digitalization. To achieve this, solely public investments are not sufficient anymore. Private capital is called for to ensure that African markets can join global players in the economy and to guarantee steady development across countries. Therefore, precise private sector initiatives are needed to develop the right structures and thus accelerate development through economic growth in Africa.

With high level representatives from public and private sector including e.g. the UN Economic Commission for Africa, the European Investment Bank, Allianz Global Investors, the Federal Ministry for Economic Affairs & Climate Action, World Bank, Volkswagen Africa, Knife Capital and GreenTec Capital, the results from the The Africa Roundtable conference in May were followed up on.

The following have been highlighted as main areas of action and goals to be achieved:

Logistical and financial infrastructure

• Open and direct transport routes that are accessible to everyone, including roads, shipping routes and airlines
• An improved, optimally uniform payment system and a stronger local banking sector through capacity building and support of the growing Fintech industry
• Successful implementation of the African Continental Free Trade Area (AfCFTA) to reach regional connectivity and to increase size of markets and thus create more opportunities to attract foreign investors and more trade corridors such as the LAPSSET Corridor Program in East Africa
• More regulated and harmonized markets through the AfCFTA
• Increased liquidity in local markets through liquidity of bonds and government bonds with lower interest rates

Project and Investment Environment

• Increased local presence of investors and entrepreneurs and promotion of co-investments
• Creation of adequate and practicable investment vehicles, support systems and on-site support
• More attention and support for bankable projects
• Increased offer of de-risking measures to support investors
• More confidence by scaling up successful investment models

Trust

• Correction of the asymmetry of perception between those in the markets and those abroad
• Reduced perceive risks through a change of narrative
• More success stories and best-case examples, bring African representatives to the table and enable personal encounters
• More information and transparency to reduce complexity of the market and strengthen the visibility of opportunities