“If you look at what is happening in terms of foreign direct investments coming to Africa, it continues to rise because of the greater political stability that is found on the continent.” – Akinwumi Adesina, President, African Development Bank (AFDB).
The African Development Bank, together with some of the world’s leading financial institutions are working to create Africa’s first investment market, which would be in form of a forum, the Africa Investment Forum (AIF), to be held annually. The forum would serve as a platform to propel the continent to its long-deserved economic fortune.
The initiative was announced by Akinwumi Adesina, President of AFDB, at a breakfast session on the sidelines of the recently concluded Africa CEO Forum in Abidjan where he told key government and private sector leaders that the forum would be exclusively about transactions and investment deals.
“This is not a talk shop. There will be no political speeches. It provides an open platform to organise efforts among multilateral institutions, governments and private sector to improve a pipeline of projects capable of transforming the continent,” he said.
The first Africa Investment Forum will hold in Johannesburg, South Africa from the 7th to 9th of November 2018. After which, it will become an annual event to facilitate interactions to negotiate and accelerate deals, and also be an avenue for candid discussions with policy-makers to shape the business and regulatory environment, as well as to track the implementation of commitments.
AIF will also focus on improving the ease of doing business in Africa by advancing and promoting investment-friendly regulation as well as promote ethical business practices on the continent.
Adesina infers that there is a lot of optimism about Africa, judging by the improvement in the cost of doing business in Africa, plus an ongoing discussion among its leaders about an Africa beyond aid. “Last year, and the year before, at least 30 percent of all the business and regulatory reforms that were done globally were not done in Asia. They were not in Latin America. They were done in Africa,” he said.
He further said, “I think that the sovereign wealth of Africa is actually not being invested in Africa. It is being invested outside of Africa. And if Africa doesn’t invest enough, then who is going to invest? One of the reasons this happens is because people have a perception of risk. But the issue is not risk. It is about how you manage risk.”
This is why AFDB is working with the world’s leading financial institutions including the World Bank, the International Finance Corporation (IFC), the Inter-American Development Bank, the Islamic Development Bank, and the European Bank for Reconstruction and Development, to set up a mutualized co-guarantee platform to de-risk investments.
According to Ken Ofori-Atta, Ghana’s Minister of Finance, who lauded the idea of the AIF, Africa needs to increase infrastructure to unlock its investment potential, opening up the continent for investment opportunities to be properly exploited. “The reality for the world is that Africa has to be, and will be, the best place to invest in future,” he said.