AVCA Seeks More Investment in Infrastructure, Local Production

The African Private Capital Association (AVCA) has urged greater investment in infrastructure, local value addition and domestic capital mobilisation to bolster African businesses and foster more resilient economies. This recommendation was made during the AVCA's Sustainable Investing in Africa Summit, where industry leaders gathered to discuss investment priorities amid economic uncertainty and geopolitical shifts.

AVCA's Chief Executive Officer, Abi Mustapha-Maduakor, emphasized that sustainable investment remains crucial to Africa's long-term growth and resilience, stressing that this focus is more relevant than ever. "Sustainability is not a matter of choice; it is a necessity for long-term value creation," she stated.

Geopolitical realignments have led to a shift in Africa's investment landscape, with the continent now capable of engaging with various global economic powers rather than being confined to any single bloc. British A. Robinson, Chair of the Africa at the Milken Institute, highlighted this newfound flexibility. "Africa is now a swing actor. It can partner with anyone. It can choose the world, and the world can choose it," Robinson noted.

Experts also underscored the importance of domestic capital in driving sustainable economic growth. Tokunboh Ishmael, Co-Founder and Managing Partner of Alitheia Capital, and Sofiane Lahmar, CEO of Development Partners International, stressed the role of domestic investment in fostering resilience. Matthieu Ducorroy, Head of Equity and Funds Division at the European Investment Bank, pointed out that Africa's economic stability is intimately linked with that of Europe, and that private capital serves as a vital bridge between these regions.

The panel discussions also addressed the need to transition Africa away from reliance on raw material exports towards local processing, manufacturing, and stronger supply chains. Saima Rehman, Senior Investment Officer for PE Funds at the International Finance Corporation, argued that retaining and processing raw materials locally would generate jobs, bolster domestic businesses, and enhance the tax base.

"Transforming the continent requires moving from an extraction economy to a locally integrated supply chain economy," Rehman emphasized.

In terms of infrastructure financing, Ishmael noted that investment must extend beyond individual businesses to encompass the broader systems and value chains that underpin their success.