European firms should invest in Africa’s infrastructure, says African Union

13th July 2017 Kennedy Abwao

European firms should invest in Africa’s infrastructure growth following the G20 Compact with Africa, Anthony Maruping, African Union Commissioner for Economic affairs has said.

“The main thrust of Africa is infrastructure growth through the private sector. The G20 Compact Initiative will encourage private European companies to invest in Africa,” Maruping said, speaking at press conference in Addis Ababa on 2 July.

The compact, sealed in Germany in March 2017, aims to boost private sector investment and infrastructure through tax initiatives, risk coverage for investors and the standardisation of contract agreements for contractors of public-private partnerships. It is driven by the World Bank, the International Monetary Fund, the African Development Bank (AfDB) and the African Central Bank Governors.

African countries with economic growth rates of above 5 and 7.5 percent, including Tunisia, Ethiopia, Cote d’Ivoire, Senegal and Uganda, have been selected to benefit under the compact, according to Maruping.

The AfDB is meanwhile preparing an increase in its authorised capital to lend more to Africa’s infrastructure projects. This comes while the bank implements a new business framework, emphasising lending towards agriculture, energy, health and industrialisation under its High Five plan.

Maruping commented that the new framework would ensure that conditions for doing business in Africa improve, subsequently raising the World Bank’s Ease of Doing Business in Africa rating.

The union meanwhile aims to build closer ties with development finance institutions to accelerate the financing of broad poverty eradication goals under the UN Sustainable Development Goals (SDGs). Maruping said financing a broader development agenda for Africa requires financial investments, some of which are already being undertaken by the AfDB.

“We have prepared our financing strategy for the Agenda 2063 on ‘the Africa We Want’, which outlines 20 goals and 13 priorities as well as prepared 34 national plans analysed and prepared from declarations of the AU. A voluntary Fund for Agenda 2063 has been proposed. We are awaiting the approval of the African ministers of finance,” Maruping concluded.

One thought on “European firms should invest in Africa’s infrastructure, says African Union”

  1. And African Provate Investors as well.
    They are supposed to be the first ones to believe in the opportunities the Continent offer.

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