November 2, 2018/AfDB
The President of the African Development Bank, Akinwumi Adesina on Tuesday commended the Presidents and Heads of State of the Compact with Africa countries for their strong commitment to reforms, adding the African Development Bank has worked very closely with the World Bank and the International Monetary Fund on the policy matrices and advancing them with positive results in the compact countries.
“Your name is written in gold in Africa,” Adesina said referring to German Chancellor Angela Merkel in his address before the German Investors Conference, organized as part of the G20 Investment Summit- German Business and the Compact with Africa Countries (CwA), held in Berlin, Germany. Adesina complimented Merkel for her relentless support for Africa and for believing in the continent’s and it’s tremendous potential.
“It is impressive that of the 101 policy commitments made by the countries, progress is being made on 98 of them, It is therefore not surprising that FDI inflows to these countries have increased by 16% in the past five years” Adesina added.
Adesina also noted that Africa-to-Africa investments are also rising, reaching $12 billion “a good sign of confidence in cross-border investments on the continent. But as we think of investments, we should also look at small and medium sized enterprises, that account for 90% of the private sector in Africa, and which face a financing gap of $190 billion,” He added.
The Bank’s president, attending the summit hosted by German Chancellor Angela Merkel, engaged young African innovators at a breakfast meeting. He also held bilateral meetings with members of the German government, during which he signed a Memorandum of Understanding with the Ministry of Economic Cooperation and Development.
Merkel announced a Euro 1 billion fund to promote and encourage businesses to invest in Africa.
The new fund will offer loan and equity financing to European and German SME’s seeking to invest in Africa, equity financing for African SME’s, and help establish a network offering advice to potential investors.
The African Development Bank has been central to the CwA initiative, providing financing to help catalyze private sector investment in the 12 Compact countries in sectors such as Energy and Finance. In Cote d’Ivoire and Togo, the Bank has unlocked local currency funding in the off-grid sector to scale up the deployment of solar home systems, through the Distributed Energy Service Companies (DESCO) programme.
According to Adesina, A lot more work is needed to accelerate investments in Africa and there is a compelling need to tap into the entrepreneurial skillsof the youth to create startups that will help boost jobs on the continent and stem migration to Europe. “We must invest in hope,” he urged.
With over $120 trillion of assets under management globally, focus should also be on how to tap into global pension funds, sovereign wealth funds and other institutional investors to invest in Africa.
Adesina invited investors at the conference to the Bank’s flagship Africa Investment Forum, the continent’s first-ever transactional marketplace bringing together investors and project sponsors to drive investment for the continent’s economic transformation. The Africa Investment Forum will be held in Johannesburg, South Africa, from 7-9 November 2018.
“The Africa Investment Forum will serve as an important private sector investment opportunity for the Compact”, Adesina said, adding that it would offer a robust platform to engage with entrepreneurs, captains of industry and key public sector decision makers on issues that are most important to the economic transformation of the continent.