By 2050, just 32 short years from now, Africa’s growing population will tip the scales at a whopping 2 billion, with a youth of 840 million. In the process, the continent will overtake the populations of China and India combined.
Financing Africa’s development needs will require an estimated US $600-700 billion per annum. According to the African Development Bank’s African Economic Outlook 2018, of this, about US $130-170 billion a year in infrastructure will be needed.
To address these challenges, the African Development Bank has launched the Africa Investment Forum, a platform to mobilize private equity funds, sovereign wealth funds and the private sector to facilitate infrastructure projects with the capacity to transform the continent.
The Africa Investment Forum has been described as a game changer for financing Africa’s infrastructure development.
“The overall Investment gap for Africa to achieve overall economic development is actually much higher and stands at $200 billion to $1.2 trillion a year. Impediments to bankable projects must be resolved to create win-wins for governments, development finance institutions and other relevant stakeholders. Africa must invest in its own development if it wants others to do so,” according to a media statement issued earlier this year.
Adesina noted that financing Africa’s development is and has always been a collective and cooperative task, requiring broad-based partnerships with the private sector.
“We know that the money is there. By 2020, there will be close to $111 trillion assets under management globally that are invested around the world often at very low interest rates. Within Africa, the assets under management of domestic institutional investors will rise to $1.8 trillion by 2020, tripling from $634 billion in 2014. Most of this money isn’t invested in Africa. But Africa should invest in its own development if it wants others to do so.”
The Board of the African Development Bank (AfDB) approved the institution’s proposal to launch an Africa Investment Forum (AIF), a meeting place for investors interested in Africa in October 2016.