Africa cannot fund energy needs with public budgets alone – Ato Forson

Dr Cassiel Ato Forson, the Minister of Finance, has warned that Africa cannot finance its energy infrastructure solely through public budgets. He emphasized the need for alternative funding sources to address the growing energy needs and industrial transformation of the continent. Forson called for innovative financing mechanisms to mobilize capital, including guarantees, blended finance, local currency funding, deeper capital markets, and credible public-private partnerships.

At the 2026 Future of Energy Conference, Forson highlighted that nearly 600 million Africans lack access to electricity, while the continent only receives about two percent of global clean energy investment. This, he said, hinders industrialization without addressing both energy and financing deficits. He stressed the importance of creating an environment that attracts long-term private investment into energy infrastructure, ensuring that these investments generate jobs, promote value addition, and strengthen productive sectors.

Forson urged African countries to break their habit of exporting raw materials while importing finished products. He cited examples such as exporting cocoa and importing chocolate, and exporting bauxite while importing aluminum products. He warned that this trend risks exporting critical minerals and importing batteries. Forson stressed that macroeconomic stability is crucial for attracting investment and sustaining industrial growth, noting that factors such as inflation, exchange-rate volatility, high interest rates, unsustainable debt, and fiscal indiscipline increase the cost of doing business.

Dr Marit Kitaw, the Economic Affairs Officer at the United Nations Economic Commission for Africa (UNECA), echoed Forson's sentiments. She proposed the concept of "development shoring," which involves locating investments in critical minerals and energy infrastructure in areas where more value will remain in Africa. Development shoring aims to generate greater development impact by directing investments towards locations capable of creating jobs, building local suppliers, technical skills, research capacity, and regional markets.

Kitaw argued that development shoring does not reject efficiency but broadens its definition to include resilience, long-term stability, and developmental impact. She stressed that partnerships should focus on creating productive capabilities and lasting development benefits that remain in Africa after the extraction of minerals.