Across Africa, there have been unprecedented levels of infrastructure investment made in recent years. Between 2013 and 2017, annual infrastructure spending across the continent averaged a record level of US$ 77.2 billion – transforming communities and economies.
Yet, with an annual infrastructure investment requirement of US$170 billion, Africa has an infrastructure deficit which stands at c.US$ 100 billion. Worse still, the infrastructure investment requirement is set to grow due to demographic trends. 50% of all global population increase by 2050 is set to take place in Africa, 60% of Africa’s 1.25 billion people are aged below 25, and 75% of all Africans are expected in live in urban areas by 2050, up from the current 50%.
Bridging this financing gap is what AFC was established to achieve twelve ago, and our mission has remained the same ever since. AFC is an independent, majority private sector owned, multi-lateral African financial institution providing project structuring expertise and risk capital to address Africa’s pressing infrastructure, capacity and economic development needs.
“We remain committed to developing and financing projects in our core infrastructure sectors of Power, Natural Resources (Oil and Gas, and Mining), Heavy Industry, Transport and Telecommunications.”
Samaila Zubairu, President & CEO
With 31 member countries, and an investment footprint that has disbursed over US$8.7 billion across 35 countries in Africa in the Power, Transport, Telecommunications, Heavy Industries and Natural Resources sectors, we are a truly Pan-African institution. We have spearheaded pioneering infrastructure solutions across Africa, from Cape to Cairo, such as 385km Bakwena Toll Road in South Africa, to the Carbon Holding petrochemicals facility in Egypt.
Moreover, in recent years we have been radically rethinking our approach in response to the ever-growing needs of Africa’s infrastructure. Rather than simply providing funding for individual projects, AFC now seeks to take a wholesale approach to infrastructure investing by seeking to invest in every step of the value chain through financing eco-systems that help integrate economies and communities as well as transform lives. We call this eco-system investing, and our experience has found that in taking this approach, we increase a project’s competitiveness, alleviate key social, economic and environmental risks that a government which does not have the necessary local capacity, may face. It also helps governments overcome capacity gaps.
Our eco-systems investing approach has already yielded positive economic and social outcomes through our investment in the Gabon Special Economic Zone Company (GSEZ), now called ARISE Ports & Logistics. Since 2016, ARISE has been able to develop a portfolio of connected projects both within and outside of Gabon (Mauritania, Côte d’Ivoire), which has enabled higher revenue generation from the Gabonese timber industry through beneficiating wood in the GSEZ and exporting higher value products to international markets.
The GSEZ has also unlocked the exporting of Gabonese manganese, an increasingly important mineral globally. Importantly, and since its inception, the GSEZ has created 4,000 direct jobs across a broad spread of highly and semi-skilled employment, contributing further the development of Gabon.
As one of the highest rated institutions in Africa – A3/P2 (Stable outlook) rating from Moody’s – we are able to deliver on ambitious projects, manage our investments, pursue the highest levels of corporate governance, transparency and sustainable development. In becoming a member of the Corporation, member countries are able to access capital at a cost they would themselves be unable to attain.
Looking ahead, our aim is to build an agile organisation with US$10 billion in assets under management by 2023 to address the urgent and important mandate of developing and financing infrastructure, natural resources and industrial assets to catalyze sustainable inclusive economic growth of the African continent for enhanced productivity.
The most critical need in the market is for project development capital and construction finance to de-risk projects as well as a market maker for institutional capital. To be the leading African Infrastructure solutions provider we will identify and pursue new strategies to optimize low cost funding sources that will enable investment in high quality assets.
We will align our offerings to the needs of African states, with whom we will deepen relationships and alliances to reduce the infrastructure deficit, develop natural resource assets and roll out industrial parks to beneficiate resources, and, substitute imports for economic growth and development.
The infrastructure investment gap and the negative impact that it has on the growth and social development of African economies forms the challenge AFC is working to overcome. It is our intention, as an organisation committed to effecting change, that we deliver a meaningful and impactful difference to society, empowering and transforming communities and economies.
Samaila Zubairu, President & CEO
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