International development secretary Alok Sharma today announced a range of initiatives to spur the City of London to boost investment in Africa by billions of pounds.
The schemes include a competition for fund managers to identify new investment products for Africa, as well as money to improve the financial systems and regulations of 45 developing nations in the continent.
The announcements came ahead of the UK-Africa Investment Summit on Monday in London, which will bring together City executives and political and business leaders from various African countries.
Africa is home to many of the fastest-growing economies in the world. In 2018, Eritrea, Ethiopia, Rwanda and Ivory Coast all grew by more than seven per cent, according to the International Monetary Fund.
London is the most popular destination for African businesses to list outside the continent. Yet assets from African countries still only account for around per cent of total investments managed by the City.
Sharma said: “The UK is already the top financial exchange for Africa’s businesses and we want investors to seize the exciting opportunities that Africa offers.”
Another of the schemes is to develop a new facility with the World Bank to develop more local currency bonds in African countries, letting businesses and governments raise investment more easily.
World Bank president David Malpass said another important element to improving investment in the region is “strong actions from countries to improve rule of law and take on vested interests”.
He said this “could create the right incentives to spur investment by strengthening financial systems, building confidence in financial markets, and enabling more productive private sector activity”.
UK minister for investment Graham Stuart said: “The UK’s position as a world centre for finance makes it well positioned to support increased private sector investment into Africa, creating more jobs, driving economic growth and financing vital infrastructure projects.”
He added: “Today’s announcements are a brilliant step forward in supporting that objective.”