PANA, photo: Eric Nathan
The African Union (AU) Tuesday announced plans to create an investment bank to finance private sector developments within the continent, as part of efforts to put the continent on a sound growth path towards its industrialization.
AU Commissioner for Economic Affairs Maxwell Mkwezalamba said talks on the formation of the continental development bank were underway to give the continent's investors access to much-needed capital to finance development initiatives.
"Africa's industrialisation dream would be unthinkable in the absence of the private sector," Mkwezalamba told the opening session of the AU-sanctioned Africa Private Sector Forum, convened to explore continental initiatives to industrialise Africa.
Africa's leading business minds, including bankers, financiers, mobile phone company chiefs, airline executives and security experts, are gathered at the AU hub to discuss available investment opportunities in Africa.
The forum also aims to sensitise the African populace on anti-graft efforts needed to push the industrialisation process, in addition to seeking to put the economic integration of Africa on a fast-track while creating working relationships with Africa's private sector.
Mkwezalamba said the continent's private sector firms were incapable of competing on a global scale because of their inability to produce industrialised goods on a massive scale.
The African industries, he noted, were also bogged down by poor investment policies.
"The private sector has a key role in Africa's industrialisation. The potential for the private sector to push Africa's industrialisation through investments in infrastructure and education can make Africa more competitive," AU's economic chief noted.
He said Africa stood to benefit from the right investment policies, targeted investments in preventing climate change impacts like drought and fighting corruption, if the continent's private-sector players targeted their social responsibility investments on climate change.
Ethiopia's Industry Minister Tadesse Haile said the private sector was Africa's only hope for industrialisation, because of the growing budget shortfalls that most African states faced, leaving little or no funds for extra-investments in roads, electricity and education.
"The budgetary constraints make it more difficult for Africa to invest in infrastructure, that is why we require the private sector to work with us in the private-public partnerships," the Ethiopian Minister told the delegates.
He said Africa's private sector, in its current form, was "weak and fragmented" and unable to compete, adding this could be addressed if the governments worked together to eliminate tedious taxation procedures and ensure non-discriminatory investment rules.
Keywords: development business banking investment
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