Key points:
- AFC targets African pension funds
- Seeks Middle East, Asia investors
- Reduces reliance on Western aid
THE Africa Finance Corporation (AFC) has unveiled plans to accelerate the mobilisation of domestic capital for investments across Africa. As geopolitical shifts pr
ompt Western nations to pull back on foreign aid, the AFC is turning its focus inward and seeking new partnerships in the Middle East and Asia, Reuters reports.
Samaila Zubairu, the chief executive of AFC, said the development finance institution—backed by Nigeria’s central bank and other African financial entities—aims to secure more funding from African pension funds and institutional investors.
Responding to Western aid cuts
Zubairu acknowledged a changing global landscape where the United States and European countries are reducing their financial support for Africa. He said the AFC is prepared to navigate a world where these traditional sources of funding are becoming less reliable.
‘The only thing we want to change is to get domestic capital more available for investment within the continent,’ Zubairu told Reuters in an interview.
He highlighted that African pension funds alone could contribute $15bn to $20bn towards domestic projects in the long term.
Scaling up investments through InfraCredit
The AFC currently deploys between $2.5bn and $3bn annually. It plans to scale up this figure cautiously, focusing on projects that can attract additional investors. One such initiative is InfraCredit, a pilot scheme that supports pension fund investments in infrastructure.
With guarantees from Nigeria’s sovereign wealth fund, InfraCredit has already mobilised around 230 billion naira ($152 million). This includes commitments from 21 African pension funds, which have traditionally limited their investments to government debt instruments.
Zubairu revealed that similar programmes could launch as soon as this year in Botswana, Angola, and Kenya. ‘This is the kind of programme we think needs to be replicated at scale. If we do this, we’ll see a lot more billions available for investment,’ he said.
Attracting international interest
Beyond Africa, AFC is also engaging investors from the Gulf region and Asia to diversify its funding sources. European stakeholders, including the European Investment Bank, have contributed to AFC’s Infrastructure Climate Resilience Fund, which has received a $52 million commitment.
AFC-backed projects like ARISE Integrated Industrial Platforms—which designs and finances industrial ventures—have also attracted international interest.
The Lobito Corridor and future prospects
Zubairu expressed optimism about continued US involvement in Africa, particularly in
the Lobito Corridor railway project. The railway aims to connect the Democratic Republic of Congo with Zambia and Angola’s Atlantic port of Lobito.
While former US President Joe Biden visited the site during his term, there has been no public indication from President Donald Trump regarding the future of US investment in the project. Nevertheless, Zubairu remains confident the corridor will move forward, describing it as a ‘bankable framework’ that offers substantial potential.
