As part of the G20 Compact with Africa (CwA) initiative, an investment summit was organized by German Chancellor, Angela Merkel for African countries on Tuesday in Berlin.
The summit featured companies with Africa commitments – and those with investment projects in the 12 CwA countries (Egypt, Ethiopia, Benin, Burkina Faso, Côte d’Ivoire, Ghana, Guinea, Morocco, Rwanda, Senegal, Togo, and Tunisia).
The Compact with Africa was initiated under the German G20 Presidency to promote private investment in Africa, including in infrastructure. Its primary objective is to increase private investment because sub-Saharan Africa is one of the world’s next major growth markets.
According to figures from the Rwanda Development Board (RDB), German business interests in Rwanda have been expanding over the past few years. From 2000 to September 2019, the RDB has registered 17 German investments (totalling above $257 million) with interests in a wide spectrum of sectors.
Nevertheless, Rwanda’s President Paul Kagame made a case for Africa’s business environment, stating that the continent is ripe for more investments from Germany and other countries in the European Union (EU).
Chancellor Angela Merkel, however, said during a speech at the investment summit that more transparency will bring an increased number of investors to the African continent. She went on to say that investors “want to know where their money is going and under what conditions.”
Merkel, therefore, urged African leaders to be truthful and transparent in their dealings with Germans and other G20 investors. Already, some German entrepreneurs regard Africa as a corrupt and conflict-ridden continent but with transparency and honesty, the continent will be stripped of such title.
Jan Koetsier, an expert on African markets in an interview with DW said that the African business index which provides an overview of the African market could change the mindset of German investors.
He believes that if the index is specially tailored to the needs of German SMBs, it will give them a better understanding of how popular their goods and services would be on different African markets, how large these markets are, which trade barriers exist and other relevant information that bares the economies of different countries on the continent.
The G20 Compact with Africa investment conference is aimed at substantially improving the macro, business and financing frameworks in African countries so that they can catch up with other countries globally.
The investment forum continues on today with a meeting between the 12 CwA African leaders and potential German investors on Investment opportunities and challenges in sub-Saharan Africa.
By Treasure Nnabugwu.