WASHINGTON, D.C. — Western Europe’s International Finance Corporation is pushing for the private sector to take on a larger role in Africa, according to Oliver Griffith, the head of its communications and public affairs.
Across Africa, the need is so large – but more importantly so diverse – that the opportunity for investment is enormous. Companies in almost any sector can be successful in Africa because Africa needs almost everything.
The level of investment needed to push Africa toward development is larger than the available public funding to meet those needs. According to Griffith, in an interview with Devex, partnerships between governments, civil society, and multilateral investment institutions are crucial for Africa, especially in the energy sector.
One of the largest challenges in Africa is finding access to electricity. The IFC joined with the World Bank in September 2007 to launch Lighting Africa, an initiative aimed at improving access to electricity in areas not yet connected to the electrical grid. By 2030, the initiative hopes to promote private sector investments that will provide up to 250 million people access to safe and affordable off-grid lighting.
IFC also supports the shift from the use of non-renewable energy sources to the greater use of clean and renewable energy sources. Previously, 70 percent of IFC energy investments were in fossil fuels. Now, 70 percent is in clean and renewable energy while only 30 percent remains in fossil fuels. They are also shifting their focus to off-grid and remote applications so as to accommodate those regions in Africa without access to the electrical grid and lacking proper infrastructure.
Over half of the world’s available agricultural land is in Africa, but the biggest challenge is forming agriculture supply chains that can link the growing cities with the rural agricultural land. Other growing areas for investment include the information technology, manufacturing and mining sectors.
In the coming years, dozens of pending projects in Africa will be finalized. Ten years ago, IFC’s investments in Africa totaled about $400 million. Now, that number is about $4 billion.
The International Finance Corporation finances about 1,600 new projects worldwide every year, and is constantly in negotiation with new companies. On any given day, the IFC maintains project teams traveling around the world encouraging companies to invest in Africa in sectors such as renewable energy, transportation infrastructure and agriculture.
– Kathryn Cassibry