‘Africa exports its savings and imports expensive capital’ – Sir Sam Jonah
Ghanaian business leader Sir Sam Jonah has challenged African institutional investors to put more of their capital to work on the continent, warning that Africa is caught in a cycle of exporting its savings while borrowing expensive capital from abroad. He said the situation was widening the continent’s infrastructure financing gap while leaving promising African businesses struggling to access…
Ghanaian entrepreneur Sir Sam Jonah has urged African investors to allocate more resources to the continent, highlighting a troubling trend where the nation is exporting its savings while importing costly capital from abroad. Addressing the Global Business Forum – Ghana Edition on August 28, Sir Sam Jonah emphasized that this predicament is widening the infrastructure financing gap and hindering promising African businesses from accessing long-term funding.
He described the situation as Africa's "great paradox," where pension funds and institutional pools are invested in short-term instruments, exacerbating the infrastructure gap and preventing entrepreneurs from securing funding. Despite acknowledging the importance of foreign investment, Sir Sam Jonah stressed the need for African countries and investors to build greater confidence in their economies.
He posited that capital follows conviction, not merely substituting for it. Drawing a parallel, he noted that investors are more inclined to commit funds to markets where African investors and institutions have already demonstrated risk-taking behavior. Sir Sam Jonah also advocated for the creation of more African companies capable of competing globally, citing his experience with Ashanti Goldfields, which became the first operating African company listed on the New York Stock Exchange.
He argued that African businesses can compete on the global stage when properly built and managed, and that hundreds more such enterprises are needed across various sectors. Sir Sam Jonah emphasized that building these businesses should not solely be the responsibility of governments but rather a collective effort. He called on African investors to embrace patient capital and invest in promising businesses early on, rather than waiting until risks are mitigated.
He maintained that investors who correctly assess and price risks at the outset could reap substantial benefits from Africa's long-term growth prospects.
Written by urgent.news from MyJoyOnline Ghana's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
