- AfDB is eyeing $2.3 trillion in sovereign wealth funds, strategic investment funds, pensions, and life insurance assets.
- The AfDB wants to unlock the potential of various wealth funds in Africa.
- Lender is now seeking set up of the African Sovereign Wealth Funds secretariat.
The African Development Bank (AfDB) is calling for unity to drive investments by mobilizing capital in Africa currently held in various funds and estimated at estimated at $2.3 trillion. This massive capital in Africa is in sovereign wealth funds, strategic investment funds, pensions, and life insurance assets.
Speaking at the Second Annual Meeting of the Africa Sovereign Investors Forum (ASIF), AFDB Vice President for Private Sector, Infrastructure, and Industrialisation Solomon Quaynor said the Bank is committed to supporting the establishment and operations of the African Sovereign Wealth Funds secretariat.
ASIF was launched in June 2022 by a group of 10 African sovereign wealth funds with a goal of facilitating the mobilisation of long-term capital to develop Africa.
Continental wealth fund
“AFDB, Africa50 and ASIF have jointly signed a letter of intent to foster cooperation in the development of green and climate-resilient infrastructure projects across Africa,” said Quaynor.
This partnership will strengthen the Alliance for Green Infrastructure in Africa (AGIA).
The founding members of ASIF consist of notable sovereign wealth funds, including the Agaciro Development Fund from Rwanda, Fonds Souverain de Djibouti, Fonds Gabonais d’Investissements Stratégiques, Fonds Souverain d’Investissements Stratégiques from Senegal, Fundo Soberano de Angola, the Ghana Infrastructure Investment Fund, Ithmar Capital in Morocco, the Nigeria Sovereign Investment Authority, and the Sovereign Fund of Egypt.
“To achieve this, we must ensure that these funds are well-managed,” added Rwandan Prime Minister Edouard Ngirente.
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Fostering Partnerships
The forum aims at strengthening strategic partnerships, and enabling pooling of financial and technical resources to drive investments. It will target crucial sectors such as climate-resilient energy, infrastructure, healthcare, technology, and agriculture.
The discussions focused on showcasing investment opportunities in Africa, understanding risks, and fostering partnerships to mobilize capital.
Ngirente said African sovereign wealth funds will play a pivotal role in developing an efficient and diversified economy. This will lead to equitable diversification and wealth generation for posterity.
Rwigamba acknowledged the value of creating a platform that unites key stakeholders and global experts for dialogue and deliberations. These engagements will contribute to shaping their strategic focus on Africa’s shared vision and development in a highly competitive environment.
Attracting Investments
Ithmar Capital CEO and ASIF Chairperson Obaïd Amrane emphasized the goal of fostering investments and attracting international capital. He said this was crucial for Africa to turn into an investment destination rather than primary recipient of aid.
He further emphasized the continent’s capability to deploy capital based on international standards. At the same time, he urged sovereign funds and Africans to set an example and transform opportunities into tangible investments.
ASIF welcomed two new members, Ethiopia Investment Holdings and Mauritius Investment Corporation. Their inclusion will significantly expand the forum’s membership.
Participants agreed on the importance of mobilizing African institutional investments into transformative projects. They agreed that this would attract global private and institutional investors to the continent.
