Africa seeks to change perceptions
AFRICA, notoriously short of new roads, ports and power stations, is increasingly leaning on its own sovereign investment funds to help fix its infrastructure gap.
The funds – which have around $150 billion (R1.9 trillion) between them, according to research firm Preqin – are digging in themselves and offering co-investment opportunities and guarantees to attract foreign capital.
The scale of the problem is huge – some 600 million Africans or half the continent’s population, still lack reliable power, according to a panel discussion at last week’s World Economic Forum in Davos.
Meanwhile, consultancy McKinsey has estimated that investment in African infrastructure is so poor it needs to double to $150bn a year.
But while investors worldwide are queueing up to finance planned overhauls of transport and energy infrastructure in the West – part of a global search for returns – they have largely bypassed Africa, still considered the preserve of development agencies or specialist funds.
Africa is still viewed in some circles as a difficult investment, hampered by corruption, war and political risk.
But now home-grown sovereign wealth funds are seeking to change this perception and kick-start projects themselves.