The Africa Investment Forum – catalysing investment flows

Dealmakers descend on Johannesburg next week for the 2nd annual Africa Investment Forum, aimed at raising capital and turning a multi-billion-dollar pipeline of projects into bricks-and-mortar.

The inaugural Africa Investment Forum in 2018 was one of the most important calendar events in Africa last year. The platform, designed to help structure projects and broker deals, has quickly established itself as the biggest gathering of global and pan-African investors on the continent and put an emphasis on accelerating deal-flow on the continent.

The Forum is a deal-making platform in the truest sense of the word, with a digital platform to view projects and financing opportunities. During the summit, projects are presented and transactions are structured with an eye for closures during sector and project specific ‘Boardrooms.’

On show last year were 63 projects with a combined value of $47bn across a number of sectors: energy, transport, logistics, and agriculture.

With last year’s event spearheaded by the African Development Bank (AfDB), and partnered with institutions such as Afreximbank, the Africa Finance Corporation, the Trade and Development Bank, the Islamic Development Bank, Africa 50, the Development Bank of Southern Africa and the European Investment Bank amongst others, sent a clear message that demand for bankable projects exists alongside the available capital to finance them.

It is estimated that in order to meet sustainable development goals, the continent needs between $400-600bn of investment, with $130bn alone for infrastructure.  A common complaint is the dearth of bankable projects available, and the long time taken to close deals on the continent.

The Africa Investment Forum aims to remedy this by accelerating investment, increasing deal flow and reducing closure times. And doing all these things at scale.

A collaborative approach

The CEO of Africa 50, Alain Ebobissé, says that the Forum proves that if you bring well-structured projects to the table, an appetite for dealmaking will follow.

Financial institutions are often guarded about projects and their pipeline of deals, even if they collaborate on loan syndications and project finance. However, at the Forum, they throw their collective weight behind new projects. The president of Afreximbank, Benedict Oramah, revealed that at last year’s Forum they had 60 meetings and developed a project pipeline of $15bn.

As well as being a marketplace, the Forum aims to tackle some of the constraints holding back investment and help policy makers develop an adequate policy framework, while helping them push through the necessary reforms to unlock investment.

Last year’s Forum attracted eight heads of state. AfDB president Dr Akinwumi Adesina insisted that attitudes are changing among heads of government, who are now encouraging growth through financial incentives and engaging the private sector as a key partner, he said.

“[Heads of government] have come to realise that private sector is not the enemy, and they can carry the load,” Adesina told reporters at the conference. “There is a much more friendly tone in their conversations.”

The AfDB hopes that the 2019 AIF stresses the crucial message that the continent is open for business, investment and dealmaking. And that the platform to connect financiers and investors with transformative projects, coupled with a real commercial return, should not be overlooked.