KALONDE NYATI, Lusaka
ZAMBIA and the continent at large need innovative home-grown financing solutions to help strengthen economic resilience and propel the continent through a new phase of growth, a continental financing organisation, United Capital, has said.
United Capital chief executive officer Peter Ashade said the socio-economic impacts of the coronavirus pandemic have exposed the vulnerabilities of the region as it continues to grapple with infrastructure development challenges compounded by capital flight to safer havens.
Speaking on Monday during the United Capital Pan-Africa e-conference under the theme ‘Fostering innovative cross-border financing solutions in Africa’, Mr Ashade said cross-border financing across sub-Saharan Africa has played a limited role in effectively addressing the funding gap across key economic sectors in the continent.
He said there is need to change the narrative in terms of providing home-grown solutions to local challenges.
Mr Ashade also said there is need for concerted effort in providing financial solutions that will spur intra-Africa foreign direct investment (FDI).
“For instance, FDI flows from China have surged from US$0.5 billion [US$500 million] in 2003 to US$43 billion in 2017. Meanwhile, France, Netherlands, the US, and the UK remained the largest investor economies in Africa with over US$60 billion investment each as at 2017. Contrary-wise, data on intra-regional investment is scarce,” he said.
African Development Bank (AfDB) estimated that between 2006 and 2016, intra-African greenfield investments grew from US$4 billion to US$10 billion.
Mr Ashade said United Capital will continue to provide necessary support to spur continental growth.
And Africa Finance Corporation senior vice-president Fola Fagbule called for export-led industrialisation citing the need to accelerate the development of multi-facility zones.
“Export-led industrialisation is a key theme in our projects to help in the export of products on the international market,” he said.
Ghana Investment Promotion Centre chief executive officer Yofi Grant said lack of capital has resulted in poor institutional growth as most local companies start from a microspace, making it difficult to make big leaps.
AfDB director Wale Shonibare called for improved cross-border trade and the need to build regional interconnections.
Mr Shonibare said more effort is required in developing the local capital market and also invest in education.
United Bank for Africa Benin chief executive officer Gbenga Makinde said there is need to adopt regional trade as a strategy to penetrate the African market.
KALONDE NYATI, Lusaka