“According to the World Bank, value added and manufacturing sectors contribute just 13% of Africa’s exports. As the continent enters a new growth chapter, radically increasing this figure will be key. As the population grows, estimated at 2.2% each year, investments in sectors that create jobs and increase wealth will be critical to ensuring sustainable benefits to people in Africa”
As a continent endowed in natural and mineral resources, Africa has the capacity for sustainable growth in industrial output. However, Africa, excluding South Africa and some countries of the Maghreb region, needs greater industrial productivity, with the majority of its raw material and natural resources exported with little or no value addition.
Critically, the sector is highly dependent on other critical sectors such as electricity supply to power industrial activities and transport infrastructure for the movement of raw materials and distribution of finished products. Consequently, deficits in these sectors adversely impact the development of the industrial sector.
Africa’s large population provides companies looking to invest in the sector with an ever-expanding consumer base and a large labour force. The region’s human capital, combined with the abundance of natural resources, is making Sub-Saharan Africa an attractive investment option for both local and international heavy industry and manufacturing firms.
AFC has supported projects in crude refining, cement, ammonia/urea and phosphates in West Africa, East & Central Africa and South Africa. In Egypt, AFC recently partnered with Carbon Holdings, a petrochemical developer and operator to deliver an integrated large-scale petrochemicals platform to take advantage of the country’s geographically strategic location. AFC also won the mandate to provide a long-term financing solution to Societe Ivorienne de Rafinnage in Cote d’Ivoire and has also obtained final approval for the financing of a modular refinery sponsored by an upstream oil and gas producer in Nigeria.
The focus in the coming years would be to support key sponsors to develop industrial projects, work in partnership with other financial institutions to facilitate mobilization of financing to fund industrial projects and target additional sectors with high-growth potential, such as agri-processing.
AFC’S Heavy Industry Projects include:
- ARM Cement
- Carbon Holdings