African Infrastructure in focus at this year’s NABA Summit
More than 400 delegates attended the Norwegian-African Business Summit 2014, NABA’s annual flagship event, on Thursday October 30th 2014. Norwegian policy makers and business leaders, African ambassadors, and business representatives from Europe and Africa were present to learn more about the main challenges and opportunities facing African infrastructure development.
More than 700 million people in Africa lack electricity, and the continent is in urgent need of investment in renewable energy. Norway will therefore contribute NOK 300 million to Green Africa Power, which is intended to encourage commercial actors to invest in sub-Saharan Africa.
- Børge Brende, Minister of Foreign AffairsMr. Børge Brende, Norway’s Minister of Foreign Affairs, opened the summit by highlighting how Africa now is being portrayed as the continent of hope, a huge change in tune from only ten years ago when the Economist labelled Africa as the hopeless continent. Foreign Minister Brende also announced that the Government will contribute NOK 300 million to the Green Africa Power fund.Green Africa Power was set up to stimulate private investment in renewable energy projects in sub-Saharan Africa. The fund’s capital will be equivalent to around NOK 1.3 billion, of which Norway is to provide NOK 300 million. Green Africa Power will offer long-term loans for private investments in the lowest-income groups of countries in Africa. [gallery columns="8" link="file" caption="true" thumbnail_size="thumbnail" masterslider="true" autoplay="false" loop="true" thumbs="true" ids="1955,1956,1957,1958"] H.E. John Dramani Mahama, the President of Ghana, opened his keynote speech by noting the growing interest in Africa because Africa is changing. According to him, the 70s and 80s can be considered as lost decades. Today, however, you now find democracies all across Africa, more respect for human rights and for independent media, which creates a good atmosphere for investment. President Mahama emphasized that inadequate access to electricity is one of the major constraints to Africa’s development, and that adequate access to affordable power is necessary to a further improvement of the atmosphere for investment.Like President Mahama, Dr. Fatih Birol from the International Energy Agency (IEA) focused on the importance of access to electricity for Africa’s future growth. To solve the inadequate access to electricity, Africa is faced with two major challenges: firstly, new power plants and related infrastructure must be constructed, and secondly existing plants must be efficiently run. Dr. Birol expects renewable energy will take up a larger share of the electricity production within 2040. Based on Norway’s background in hydropower, Norway is a perfect and tailor-made partner for many African countries.
African Infrastructure – current status and looking ahead
Sir Paul Collier, Centre for the study of African Economies, Oxford University.Sir Paul Collier from the Centre for the study of African Economies at Oxford University presented the current and future status of African infrastructure. Sir Collier presented three key opportunities for Africa; firstly, he stated that Africa has only discovered ⅕ of the resources discovered in OECD countries and that the natural resource story is not over. Secondly, Africa is urbanising rapidly, a feature that leads to large increases in productivity. Thirdly, Africa is starting to capitalise on the manufacturing opportunities on the continent, partly due to Chinese investments. As Africa seizes these opportunities, the need for infrastructure will increase even further.
Panel discussion: Africa’s infrastructure deficit equals opportunities
During this year’s summit, there were two panel discussions held. The topic of the first panel discussion was the opportunities that the African Infrastructure deficit opens for and how companies can tap into this. According to the panellists, investing in Africa is an executive game: are you able to execute the opportunities that are presented. Investing in Africa is not only about business, but also about development. The panellists discussed how Africa is misperceived on the risk front and that investing in Africa is good business as the return rates are very high.
Panel discussion: Financing the infrastructure
The topic of the second panel discussion was the financing of infrastructure development in Africa: how the situation is today and what needs to happen for funding to be available for such projects. Panellists argued for an ongoing transition away from the public sector towards the private sector with regards of the funding of infrastructure projects. Private capital will reduce the risk of debt problems. Local financial markets should also create more bankable projects. Some of the panellists stated the need for regulatory reform, while others argued that the current regulatory framework is adequately mature as it is.
Parallel sessions
Following lunch the summit broke down to parallel sessions focused on four different sectors. A panel consisting of professors, investors and directors discussed impact investments in Africa. This gave us an opportunity to see the effect of impact investment from different angels and perspectives. The demand for agricultural products is rising along with a growing middle class. Five Norwegian companies presented experiences and opportunities within agribusiness and aquaculture in Africa. Private sector representatives and government officials discussed best practices, government policies and knowledge transfer in a session about renewable energy. In a session about oil and gas in West Africa, hosted by Dr. Gulbrand Wangen of INTSOK, companies working in West Africa shared their experiences and their outlook on the future developments.
Speed meetings
The popular speed meetings session in the afternoon offered a great networking arena. More than 30 ambassadors/embassy representatives were present to discuss opportunities in their respective African countries with potential business partners.The Norwegian-African Business Summit 2014 has contributed to address the main challenges and opportunities facing African infrastructure development, opening up to improved Norwegian-African business relations, and establishing new contacts, partners and networks to the many participants.
Summary by Arsene Frank Burakeye