This post originally appeared in Business Daily Africa. Papa Madiaw Ndiaye is founding partner and CEO of Advanced Finance and Investment Group Funds and a member of IGD’s Frontier 100 network. He is attending the Frontier 100 Fall Forum October 27 in New York City.
Africa’s promise and potential as a destination for global investment has energized investors from all over the world.
They are reacting positively to the substantial returns some of them have earned from investments in Africa, particularly over the last ten years.
Investors are further encouraged by changes that have been made to improve the climate for business all across the continent.
While the more developed economies recover slowly from the aftermath of the economic crisis, evidence consistently shows that Africa is projected to see strong annual growth rates over the next few years.
As African business leaders, we cannot “do business as usual”: it is our time as well as our responsibility to guarantee the sustainability of Africa’s growth and to lead its economic future.
The surest way for business leaders not to miss out on Africa’s growth opportunities is for us to invest strategically in high-potential, homegrown African companies, while promoting government policies that create positive environments for business.
Prosperity
To be truly competitive in an increasingly global marketplace, homegrown African businesses must be able to attract additional funding.
At the end of 2005, I founded Advanced Finance and Investment Group (AFIG), a private equity fund management company, to address the substantial gap in equity funding for homegrown African businesses.
Prior to this time, much of the private equity activity in West and Central Africa focused on privatizations, capitalization of non-African company subsidiaries, and buyout opportunities.
AFIG helps its portfolio companies succeed by going beyond mobilising capital to offering a range of value added services such as financial advisory services and debt capital raising.
For all of the growth Africa has experienced over the last ten years, most notably in telecommunications, the potential of most other sectors remains virtually untapped.
Together, consumer goods, resources, agriculture and infrastructure are estimated to be worth $2.6 trillion in annual revenue by 2020.
While dramatic to some, such statistics speak about much more than profits: investing in successful African businesses will advance an expanding cycle of economic activity and development, which I believe will produce world-class multinational corporations – and long-term prosperity for Africa’s people – by the end of this century.
Now is the time for successful African entrepreneurs to show their leadership by thinking with a global perspective while continuing to act at the local level by investing strategically and advocating for environments where private enterprise can thrive.
