Left Menu
Development News Edition

Development financiers to contribute to closing the infrastructure finance gap in Africa

The panellists highlighted the importance of project development and supply of bankable projects as being key for private sector investors.

AfDB | Updated: 21-10-2020 08:13 IST | Created: 21-10-2020 08:13 IST
Development financiers to contribute to closing the infrastructure finance gap in Africa
Launched at the end of 2019, the DFC has an investment cap of $60 billion and has selected Africa as a priority region for future investments. Image Credit: Wikipedia

The continent's largest development finance institutions have emphasized that a sustained and collaborative approach among development partners to scale up project development activities, will boost the number of bankable projects attracting investor interest and contribute to closing the infrastructure finance gap in Africa.

They spoke during a panel event to discuss their organizations' role in the post-COVID-19 environment, convened on October 16, as part of a day-long public forum on investing in Africa's future, organized by the U.S. International Development Finance Corporation (DFC) and the Atlantic Council. The event had over 2000 participants.

Launched at the end of 2019, the DFC has an investment cap of $60 billion and has selected Africa as a priority region for future investments.

African Development Bank Acting Senior Vice President Bajabulile Swazi Tshabalala, was joined by Samaila Zubairu, President & Chief Executive Officer of the Africa Finance Corporation (AFC); Admassu Tadesse, President & Chief Executive Officer of the Eastern and Southern African Trade and Development Bank (TDB), and Alain Ebobissé, Chief Executive Officer Africa50, for the hour-long session, which was moderated by Edward Burrier, Executive Vice President of Strategy at the DFC.

The panellists highlighted the importance of project development and supply of bankable projects as being key for private sector investors. This requires an active approach in investing capital into the early stages of project preparation and accepting the risk, which has been one of the most important deterrents to attracting foreign investment into Africa. Most of the participating institutions offer a wide variety of financial instruments and products to help de-risk such investments.

In Rwanda, Samaila Zubairu spoke of the AFC's Kigali Innovation City (KIC) technology hub project, which is already changing the narrative about Africans only consuming technology rather than being developers. "It's risky business, but extremely impactful," Zubairu said. His comments were echoed by Admassu Tadesse, who said the "blended" returns of dividends and the development impact of some of these projects made any risks worthwhile.

For Alain Ebobissé, Africa 50's unique niche which is focused on solving Africa's infrastructure gap through a strong emphasis on both the project development and project financing of infrastructure projects, ensures a healthy supply of bankable projects through the mainstreaming of project preparation activities. "We develop very close relationships with our government shareholders and as a result project implementation is speeded up – especially in the context of the COVID-19 pandemic".

The Acting Senior Vice President, Swazi Tshabalala spoke about how the African Development Bank's High 5 priorities represent a significant investment opportunity for US investors in a variety of projects spanning several sectors such as energy, agriculture and food security, regional integration and private sector. More significantly, in the context of the current pandemic, enhancing Africa's health infrastructure, water and sanitation are key.

Tshabalala noted that following the signing of a Memorandum of Understanding in 2019 with DFC, the two institutions are currently collaborating on energy projects in Senegal and Madagascar. "We see that as the beginning of our stronger engagement and partnership," she said.

The Bank's Africa Investment Forum is playing an important role in helping to channel critical capital flows to the continent by targeting the multi-trillion-dollar global institutional investor base. Tshabalala also highlighted the growing partnership on the Africa Investment Forum with the other institutions represented on the panel and their collective efforts to bring bankable projects to private sector investors.

Asked about how the Bank balances its sovereign lending against private sector needs, Tshabalala said sovereign lending was crucial, "especially in the development of basic infrastructure that is a pre-requisite for development." This also includes the provision of concessional financing to transition countries through the African Development Fund.

The Bank also engages in enhanced policy dialogue and provides knowledge products which enable governments to create the right environment for private sector investment. "We have over the years been increasing our direct investment in the private sector which has grown to become a significant component of our overall lending portfolio," Tshabalala said.

In an earlier panel discussion that opened the day's proceedings, African Heads of State shared their insights on opportunities for trade and investment, with moderation and remarks provided by the DFC's CEO Adam Boehler. The panel included President Macky Sall of Senegal, President of Mozambique Filipe Nyusi, and the President of Niger, who was represented by his Chief of Staff.


TRENDING

OPINION / BLOG / INTERVIEW

Turbulence surrounding tobacco control in Ghana

... ...

Smart healthcare: IoT redefining the way healthcare is delivered

As the world is embracing the new wave of digitalization triggered by the pandemic and the arrival of 5G, the adoption of IoT devices will further boom. With adoption set to soar, IoT security issues and other challenges cant be ignored any...

Refugee compassion and response: Ideas to mitigate disasters now and in their future

Their homeland becomes a forbidden territory for them and more likely than not, their journey to foreign soil is no less traumatizing, not to say deadly. It is crucial to help refugees live a life of dignity and purpose....

Inadequate water infrastructure causes a tidal wave of coronavirus in rural Alaska

... ...

Videos

Latest News

POLL-Oil prices face uphill struggle in 2021 despite vaccine progress

Oil prices will struggle to gain upward traction next year as demand remains in the grip of the coronavirus pandemic despite growing optimism over vaccines and a likely extension of output cuts by top producers, a Reuters poll showed on Mon...

OPEC+ to discuss extending oil cuts or gradually raising output, sources say

OPEC members will consider whether to extend existing oil cuts for three to four months or to increase output gradually from January during their two days of talks that start on Monday, OPEC sources told Reuters.Officials from the Organizat...

INSIGHT-Threats, detentions and frozen assets: Nigeria's protesters depict pattern of intimidation

At 7 a.m. on a recent Saturday, Onomene Adene received a call from a man whose voice she did not recognise.The man said he knew her from church and asked for help getting a package to their pastor. She agreed to meet him at a bank near her ...

Educational institutions to remain closed across J-K till December 31

All schools, colleges, and higher education institutes in Jammu and Kashmir will remain closed till December 31 according to an order issued by the Union Territory administration. Class 9-12 students can visit schools on a voluntary basis. ...

Give Feedback