If Africa is to seize the opportunities of the future, it needs to mobilise large-scale, sustained investment, especially in infrastructure, President Cyril Ramaphosa said in his address at the Africa Investment Forum under way in Johannesburg this week.
Organised by the African Development Bank (AfDB), the event has attracted hundreds of private- and public-sector delegates, including several African Heads of State and government, among them being President of Ghana, Nana Addo Dankwa Akufo-Addo, President of Guinea, Alpha Condé and President of Ethiopia, Sahle-Work Zewde.
AfDB president Akinwumi Adesina stressed that the event had been designed to be “transactional” and reported 306 potential deals, valued at $208-billion, were being showcased. Sixty of those potential transactions, valued at over $40-billion, were the subject of special “boardroom sessions” aimed at fast-tracking the projects to closure.
Picking up on the theme of partnership emphasised at recent domestic summits, including the recent South Africa Investment Conference where commitments worth R290-billion were made for South Africa for the coming five years, Ramaphosa said African governments could not bolster investment without business.
“It is only through partnerships that we can succeed, and through mobilising our collective resources that we can have the financial means to do what we have set out to achieve.”
The private sector and private markets, he added, were key participants in the African investment landscape, supported by the lending capacity of financial institutions.
“If we are to unlock and sustain the flow of capital to Africa, we need to drive the economic reforms necessary to create an enabling business environment. To be globally competitive, to become investment destinations of choice, we need to resolve the problems that keep investors away.”
African countries would need to address governance challenges such as policy uncertainty, financial mismanagement and corruption.
“As African leaders, we must demonstrate a firm commitment to act against corruption both within public institutions and the private sector. We must deal with burdensome red tape, provide policy and regulatory certainty, and strengthen our financial institutions,” Ramaphosa said.
However, the South African President stressed that “Africa was on the rise” and called on investors to recognise the reforms that had already been introduced and the commitment of most African leaders to both democracy and economic development.
Ramaphosa also highlighted the potential for business and investment that would arise as a result of further African economic integration, as signalled by the adoption of the Africa Continental Free Trade Area (AfCFTA) agreement in Kigali, Rwanda, in March.
“This is good for investors, who will have access to a market of more than 1.2-billion people and a combined GDP of more than $3.4-trillion.”
However, to extract “the real value” of the AfCFTA African countries needed to have the means to produce the goods that they wanted to trade.
“We need factories, affordable energy, reliable water supplies, universal broadband and integrated supply chains. We also need the roads, railway lines, harbours and air networks that are essential to move these goods. And the people who will produce and transport these goods need decent housing in sustainable communities. They need schools, universities, clinics and hospitals.”