Africa: Africa Has Ideas - What It Lacks Is a Fair Hearing from Global Capital

What the report says

AllAfrica published a guest column by Daniel T. Makokera arguing that Africa’s main financing challenge is not a lack of viable ideas, but a shortage of global capital willing to judge them on their merits. The piece says entrepreneurs, engineers, farmers and governments across the continent often face higher borrowing costs because African markets are first viewed through the lens of risk, which can make otherwise workable businesses and projects too expensive to fund. It places this in the broader context of sovereign risk, currency pressure and thin liquidity, while noting that these factors can create a cycle in which expensive capital reinforces weak fiscal conditions and further deters investment.

The column also says the problem is not that Africa has no risks, but that investors may be applying a broad continental label instead of assessing individual projects. It contrasts different types of ventures, including renewable-energy schemes with long-term contracts, export-oriented agricultural firms and infrastructure with predictable revenues, to show why one-size-fits-all risk assumptions can be misleading. The author argues that this mismatch affects not only governments but also businesses, factories, farmers and young workers, because delayed or unaffordable financing can limit jobs, industrial growth and local value addition.

As a sign of possible progress, the article highlights a move by the Liquidity and Sustainability Facility and Legal & General Asset Management to launch what is described as the first African government bond ETF available in Europe. It says such products can improve transparency, liquidity and investor familiarity, potentially easing Africa’s funding constraints. More broadly, the column suggests that similar structures could eventually be used for infrastructure, renewable energy, agriculture and corporate debt, helping African assets attract more institutional capital.