JOHANNESBURG – For any investor interested in Africa, there is only one place to be this week – Johannesburg.
When the three-day Africa Investment Forum opens today a total of 61 deals estimated at more than $40 billion (R567.4bn) will feature in "boardroom sessions", while another $28bn will be showcased to investors at a marketplace Gallery Walk.
The deals are curated from a total pipeline of 230 projects worth more than $208bn, which span several sectors – energy, infrastructure, transport and utilities, industry, agriculture, ICT and telecoms, water and sanitation, funds/financial services, health, education, hospitality and tourism, housing and aviation.
Risk, or at least the perception of it, has long been a major impediment to attracting foreign direct investment in Africa.
But the African Development Bank is tackling this problem head-on by removing barriers that have prevented investment finance from flowing into the continent.
This first-ever transaction-based Africa Investment Forum is the most important step in this process.
By bringing together multilateral financial institutions, pension funds, sovereign wealth funds, and private investors, African Development Bank aims to create a mechanism to reduce market, political and financial risks, and in the process improve the ease of doing business.
As part of this effort, the investment forum will prioritise public-private partnerships and private sector deals. The message we aim to deliver is simple: Africa is open for business.
African economies offer tremendous opportunities, especially in energy, infrastructure such as roads, railways, ports, and in agriculture, minerals, oil and gas.
The potentials are huge. But Africa must move beyond potential and turn potential into streams of wealth for greater prosperity on the continent.
Achieving that requires supportive government policies. In every country, the African Development Bank is engaging with policymakers to improve legal and regulatory environments and create a more predictable business climate.
These efforts are already paying off. For example, interest in $50bn worth of investment-ready projects that we made available for pre-screening before the Forum has been higher than anticipated.
We are delighted that several multilateral financial institutions are strongly partnering with the African Development Bank on this effort, including the International Finance Corporation, the World Bank, Asian Infrastructure Investment Bank, Islamic Development Bank, European Investment Bank, European Bank for Reconstruction and Development and the Inter-American Development Bank.
Within Africa, all the major financial institutions are on board this platform, including the AfriExim Bank, Africa Finance Corporation, Trade and Development Bank, Africa50 and the Development Bank of South Africa. For the first time, we are all coming together to deliver as one.
The Africa Investment Forum is the first of its kind where all the major global and regional financial institutions get together to help de-risk investment projects at scale.
Of course, pledges of partnership are not the only reason for optimism; economic trends are also strong. For starters, real gross domestic product growth is forecast to be 3.5 percent this year and 4 percent in 2019. Today, Africa includes five of the world's 10 fastest-growing economies.
Africa has also become the world's second-most attractive investment destination.
According to the UN Conference on Trade and Development, inward foreign direct investment (FDI) is expected to increase by about 20 percent this year, to $50bn. This is an increase from $42bn registered in 2017.
Finally, Africa's pension funds, insurance funds, and sovereign wealth funds are collectively valued at more than $1 trillion dollars.
Global assets under management are more than $131 trillion. If Africa could leverage this wealth to attract just 1 percent of all global assets under management, the continent's annual infrastructure needs of $130bn to $170bn, with a financing gap in the range of $68bn to $108bn, could be closed.
Africa has a huge population to drive consumer demand, rising middle class, a young and dynamic youth population and rapidly reforming governments that are keen to attract these investments.
The Africa Investment Forum will provide what has so far been missing: a safe, stable marketplace to accelerate deals.
The Africa Investment Forum's goal is simple: provide a smooth landing strip for investments in Africa.
What we need now are investors who are ready to seize the tremendous opportunities in Africa and land their investments safely on the continent's premier investment market place.
Akinwumi A Adesina is the president of the African Development Bank.
The views expressed here are not necessarily those of Independent Media.