Jim O’Neill, renowned economist who coined the ‘BRIC’ and ‘MINT’ acronyms, declares the African infrastructure divide, ‘both a defining challenge and a standout investment opportunity of our generation’.
Speaking at Africa Finance Corporation (AFC) inaugural summit 2014 held in Lagos, O’Neil said that Africa’s future depends on the continent’s policy makers doing the right thing.
The four key areas he wants African leaders focus on include redefining (better) governance, reducing crime, fighting corruption and delivering improved infrastructure.
According to him, “Africa’s future depends on the continent’s policy makers doing the right thing. That is working to create better governance, reducing crime, fighting corruption and delivering improved infrastructure. Infrastructure development is both a defining challenge and a standout investment opportunity for Africa and investors around the world. For example, Nigeria is growing at 7% despite poor access to power; decent power could boost economic growth to 10%-12%. There is no reason why Nigeria should not become one of the G20.”
The Summit christened ‘AFC live’ attracted more than 500 leading thinkers from government, academia, business and finance, fuelled energetic debate on both the opportunities and the challenges of the African infrastructure landscape.
O’Neil who is also the former chairman of Goldman Sachs Asset Management, identified that, infrastructure in general, has been estimated to have the potential to add an average of 2% to Africa’s economic growth rate over the next decade as investment is brought to bear to bridge the current circa US$40 billion per annum investment deficit.
Andrew Alli, president and chief executive officer (AFC), told the delegates that, “The sheer number of people here today, passionately engaged in the debate on infrastructure and what it means for the future of this great continent, is inspiring.
“Our vision at the AFC is to bridge the infrastructure divide and seek a strong return for our shareholders at the same time. We believe our core role comes at the earliest stage of project conception and development.
“While international capital will be fundamental in bridging the investment divide, that capital will have nowhere to go if Africa does not focus on the development of bankable, sustainable projects. By focusing on supporting project development and using our local knowledge and sector expertise to identify and mitigate risk we come in to transactions at an earlier stage than many investors.
“Our role is to accelerate the number of viable, bankable projects across the continent, creating the market for other forms of capital that will follow, and ultimately bridging the investment divide that exists. We believe landmark transformational projects can yield financial dividends every bit as powerful as their social ones and our success to date demonstrates this.”
At a ceremony on stage, Cape Verde Minister of Finance Cristiana Duarte signed the instrument of accession for membership of the AFC.
Cape Verde becomes the 9th country to join other member nations, including: Chad, The Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Nigeria and Sierra Leone.
AFC is a pan-African investor and its investments are not limited to member states.
Cristiana Duarte, minister of Finance of Cape Verde said, “I am very pleased today to be able to formalise Cape Verde’s membership of the Africa Finance Corporation. Cape Verde and the AFC have enjoyed a very productive and collaborative relationship over the last few years.
“As the lead investor in Cabeolica, our award winning $90 million 26MW commercial wind farm we have firsthand experience of the expertise the corporation can bring to innovative projects and we look forward to working to deliver more projects over the coming years.”
Baring his mind on the infrastructural deficit in Nigeria, particularly, the power sector, Mr. Tony O. Elumelu, chairman of Transcorp Plc, managers of Ughelli Power Plant, said investors in both the power generation and distribution have not forgotten their promises to deliver to Nigerians, adding that, public awareness needs to be created on the progress made under the privatilization scheme.
Elumelu had declared intent of Transcorp Plc to leverage their time tested expertise in turning around businesses in growing the Ughelli Power Plant to a 1000mw generating plant by 2017.
