Chinelo Anohu, Head and Senior Director of the Africa Investment Forum
The current tensions in Ukraine and how reliant Europe is on Russia for its energy supply should serve as an urgent wake-up call for the global community to invest long-term to help develop sustainable resources and diversify countries’ energy portfolios. This couldn’t be truer and more integral than in Africa. As the president of the host country of the upcoming COP27 climate talks recently stated, investing and encouraging African nations toward a clean energy transition should be an international priority.
To accomplish this, Africa needs investment from across the globe.
A great example of this is the Prosper Africa campaign launched by the Biden-Harris administration. Its mission to elevate and energize the United States’ commitment to trade and investment with countries across the African continent has been a model of success. Since launching Prosper Africa in 2019, the U.S. Government has facilitated a number of deals across multiple sectors including 107 Energy, 75 Agribusiness, 54 Healthcare, and 32 Environmental Technology, comprising of $50 billion in exports and investments.
Another recent example occurred earlier this month when the European Union dedicated $170 billion to the continent as part of the Global Gateway Initiative project. It will be used in part for programs such as infrastructure investments and sustainable development.
The EU and American-led efforts are encouraging and will play an important role in the continent’s economic expansion and development. But much more is needed to achieve Africa’s full potential. With more than six hundred million Africans still unable to access electricity, Africa is facing its own energy crisis, which leads to further volatility and instability, especially in the aftermath of the economic shocks brought by COVID-19. Sustainable projects in Africa could provide millions of Africans with desperately needed power and could lead to higher employment, stronger growth and innovation.
The development of Africa will not only transform the continent itself but the entire global economy and international order. The continent has the fastest growing population and possesses an overwhelming proportion of critical resources needed by the present and future global economy. By 2050 more than one of every four people will live in Africa, its GDP will increase to 17% overall, and approximately 20% of the world’s energy supply will come from Africa.
The U.S. and European efforts reflect many of the goals that our organization, the Africa Investment Forum, share and are working towards every day. International investors don’t just need deals that make sense in numbers alone – they also need transparent, competitive, and efficient management, guarantees of sustainability and to know that their money will result in a higher quality regional and pan-African economy.
At the core of all economies are decisions made by the private sector. African countries need investment from the global community of companies, banks and philanthropists. This is why the AIF is scrutinizing and shortlisting deals across Africa that meet specific criteria, including a positive environmental and social impact. The AIF is working hard to find, promote, facilitate, and complete the deals Africa needs.
African countries must grow into green, sustainable and modern economies from scratch while also improving living standards and managing rapidly rising populations. Balancing these demands is why it is vital investment into Africa is done with high-quality decision making that meets targets across social welfare, sanitation, agriculture, climate change and a great many others.
This is not just development theory: A great example of the AIF’s high-quality work is the ongoing development of a manufacturing plant in North Africa to produce advanced solar panels, which provide an integrated source of renewable energy, clean water and hot sanitation water. The project is expected to contribute to the reduction of greenhouse gas (GHG) emissions by 42 million tons of CO2 per year and to ultimately supply electricity to more than 100 million households.
It is a remarkable example of how innovation is key to providing the solutions we need. This is also not just a success story; rather, it underlines the entire approach needed to achieve economic growth while also continuing the historic expansion of basic human provisions in Africa.
Supporting Africa toward a path of self-sufficiency is in all of our interests. Governments and businesses around the world should advance and accelerate sustainable programs. With this shared purpose and ambition we can all benefit from the growth of Africa.