Africas businesses and entrepreneurs account for 90% of jobs, 70% of gross domestic product, and 70% of investment on the continent, according to research by the African Development Bank (AfDB). Recognising the private sectors outsized influence on Africas economic prospects, the Bank has made it a priority to catalyse private investments in Africas most productive and promising sectors. President Akinwumi Adesina believes the lender is making commendable progress on this important mission.
The African Development Bank is mobilising more private sector investments into Africa, he told Chatham House recently. He recalled with pride how the Bank has helped put together financing for some of the most transformative projects in Africas private sector.
We supported the $24 billion LNG (Liquified Natural Gas) project in Mozambique, which will provide over $66 billion in revenue for Mozambique and make it the third-largest exporter of LNG in the world. We supported the $19.5 billion Dangote Refinery Complex, the largest single-train refinery in the world and the largest ammonia plant globally. We supported the $13 billion OCP phosphate company in Morocco, the largest phosphate fertiliser plant in the world, he remarked.
Looking ahead, the AfDB remains committed to championing private sector solutions. Private investment will be the source of most of the finance that Africa needs to achieve the SDGs and the objectives of Agenda 2063, the Bank states in a report to investors. Creating a favourable environment for private investment is therefore key to narrowing Africas financing gaps and promoting inclusive green growth.
Making projects bankableCurrently, Africa draws a mere 3.5% of global foreign direct investment, with the majority of capital funnelled into natural resources and extractive industries, according to the United Nations Conference on Trade and Development (UNCTAD). To boost its share of global FDIs, Africa needs to develop a pipeline of bankable projects in other sectors to attract private sector participation.
