E-Financial
Investing in Africa’s Value Chains as a Catalyst for the Post-pandemic Recovery
By Stephen Barnes
As Africa looks to rebuild in the aftermath of COVID-19, corridor financing and investing in productive infrastructure will be key to economic recovery and sustained growth across the continent.
The pandemic brought to light Africa’s vulnerable infrastructure network. However, this same weakness now has the potential to be a driving force in the continent’s economic recovery.
Large infrastructure programmes have the potential to unlock Africa’s long-term potential, while also offering immediate employment opportunities for those struggling as a result of the pandemic.
Africa’s core infrastructure networks – water, transport and power – are still very much in development. According to the World Bank, more than half the people living in sub-Saharan Africa, do not have access to electricity.
As a result, there is widespread consensus that the region’s economic development, both in terms of its short-term recovery from COVID-19 and its longer-term prospects, should be led by infrastructure development and maintenance.
However, creating investor confidence will be crucial to attracting the investment required to finance these projects.
While there isn’t a lack of private capital to fund projects across the continent, there is a shortage of bankable investment projects. And despite African governments taking infrastructure investment seriously as a primary driver of post-pandemic economic growth, investors remain cynical about their ability to deliver.
Ineffective project planning, regulatory uncertainty and a lack of depth in local capital in foreign exchange markets is holding projects back and preventing value chains from forming. So, what can be done to restore confidence and get Africa’s infrastructure projects moving?
I believe a large part of the answer to this is in shifting the emphasis from discrete infrastructure projects to the entire value chain associated with it, which will unlock greater multiplier effects.
An example is transport corridors – without reliable routes to market, Africa will not be able to attract the investment required for long-term, sustainable economic growth. Improving the efficiency of transport corridors greases the wheels of trade and promotes economic activity across various sectors within the economy.
A great example of what can be achieved with corridor financing is the Maputo corridor which spans both Mozambique and South Africa. Here investments in port infrastructure led to investment in the N4 highway, which in turn linked up crucial mining towns to the value chain, further driving growth.
With the African Continental Free Trade Area making it easier each year to trade across borders, each dollar spent along a transport value chain has the potential to create multiple dollars of economic benefit.
Distributed energy also has an important role to play in addressing energy supply challenges in sub-Saharan Africa, whether at utility scale or in respect of rooftop solar home systems.
Starsight Energy, a West African Commercial and Industrial energy provider, has deployed approximately 41 MW of generation assets, 33 MWh of storage, and 16,320 HP in cooling capacity across 547 sites in all Nigerian states and Ghana.
It continues to leverage on its strategic relationship with key Original Equipment Manufacturers to deploy state of the art smart technology in order to optimise energy consumption, enabling customers to significantly reduce energy costs, boost profitability and reduce their carbon footprints.
Another example is M-KOPA which focuses on the retail market. The company pioneered and kick-started the wider pay-as-you-go (PAYG) solar market and has been operating for over 10 years with a presence across East and West Africa.
It has built a highly advanced connected asset financing platform, which has provided nearly $400 million in financing that has enabled 1 million customers to access solar lighting, energy-efficient televisions and fridges, smartphones, cash loans, and more.
Benefits realised include replacement of kerosene as source of fuel, thereby avoiding nearly 2 million tonnes of CO2 from entering the climate; healthier living conditions; economic empowerment from savings realised and employment creation; access to information via smartphones and televisions; and business owners being able to operate longer hours and children studying under better lighting for longer hours.
These entities are leading the way in providing energy to Africans. This type of development is key to Africa achieving its goals.
Much has been made of the levelling effect of the pandemic, with businesses, governments and consumers alike communicating and working digitally from their own homes. With the right investment this can provide African businesses with the opportunity to compete on a global scale.
That is why digital infrastructure will continue to be a driving force in Africa’s Fourth Industrial Revolution, as it will also work to empower Africa’s unbanked population.
Africa offers a broad range of infrastructure investment opportunities as build programmes remain a core focus of African governments, particularly as they look to catalyse growth post the pandemic.
Whilst much work is still required to ensure the enabling environments across most markets deliver a greater number of bankable projects, right now there are a broad range of investment opportunities offering investors attractive risk return profiles.
At Standard Bank Group, we have significant experience in the sector and have been involved in financing and advising on a wide range of infrastructure projects across the continent.
We know there are several high potential corridors of growth that investors should consider, particularly in East Africa, including Ethiopia, which is already seeing positive growth despite Covid-19.
Investors should also continue to look at South Africa as a key market and a treat it as the gateway into Africa. Lastly, West African Markets such as Ghana and Nigeria will offer significant investment potential over the medium term.
Stephen Barnes, Global Head: Power and Infrastructure, Client Coverage at Standard Bank Group
First Asset Management Limited, a leading investment management firm in Nigeria and a subsidiary of First HoldCo Plc., has announced a significant milestone, the company has surpassed ₦1 trillion in Assets Under Management (AUM).
This achievement reflects the firm’s steadfast commitment to delivering exceptional client service and strong investment performance. It also underscores the trust and loyalty shown by its clients, partners, and stakeholders, which have been instrumental in driving the company’s sustained growth.
Speaking of the milestone, Ike Onyia, Managing Director of First Asset Management Limited, credited the accomplishment to the enduring support of the firm’s clients and stakeholders.
“This milestone is a clear indication of the confidence placed in us by our clients and partners. It highlights the firm’s ability to deliver successful investment outcomes and reinforces its dedication to fulfilling its mandate,” Onyia said.
He went on to express deep appreciation to the firm’s clientele: “The continued partnership of our clients is not taken for granted. Their commitment has been pivotal, and the performance of their investments inspires the team’s dedication to providing best-in-class service. As the firm continues to grow, it remains focused on deploying innovative and forward-looking investment strategies tailored to each client’s financial goals.”
Federal High Court in Abuja has rejected the request to stop the Central Bank of Nigeria (CBN) from using the e-naira trademark for the growth of the country’s economy.
Justice James Omotosho refused to grant the request brought before him by E-naira Payment Solutions Limited, a private company, which had dragged the CBN before the court, praying for an order of interim injunction restraining the apex bank from using the e-naira trademark on the grounds of lack of ownership.
It claimed that the disputed e-naira trademark was its sole property based on the acceptance of its application for registration by the Trade Marks Registry of Nigeria.
The plaintiff claimed that its ownership of the trademark was being threatened by the CBN’s bid to hijack the mark, adding that it would suffer irredeemable damages if the apex bank were allowed to assume ownership of the mark.
In a motion on notice marked FHC/ABJ/CS/2021, E-naira Payment Solutions Limited asked the court to stop the CBN from communicating with the United States Patent and Trademark Office regarding the disputed trademark until the dispute is fully resolved.
It also pleaded with the court to stop the United States from processing the CBN’s application for the formal registration of the e-naira trademark for use by the CBN and the federal government of Nigeria.
However, the CBN, in its defence, pleaded with the court to reject the request on the grounds that the e-naira trademark is a national asset that can only be owned and used by the federal government of Nigeria and itself.
The apex bank claimed that the letter of acceptance of registration issued to the plaintiff in error by the Trade Marks Registry of Nigeria had since been voided and withdrawn through a letter dated 15 November 2021.
CBN, while describing the e-naira trademark as national intellectual property, informed the court of its possession of a registration certificate from the Trade Marks Registry of Nigeria in line with Section 22 of the Trade Marks Act and that it was on the verge of securing registration from the United States Patent and Trademark Office.
The bank maintained that the e-naira trademark cannot be owned by an individual or private corporate body such as E-naira Payment Solutions Limited and faulted the ownership claims of the plaintiff, adding that there was no proof of its claim in Class 36 that it had registered the mark with the Trade Marks Registry of Nigeria.
Contrary to the plaintiff’s claim, the CBN, in its defence, insisted that Nigeria would suffer huge losses in its economy and reputation in the international community.
In his ruling on the motion, Justice James Omotosho agreed with the CBN that Nigeria’s economy would suffer greater damage than the plaintiff if the request were granted.
The judge held that the letter written by the CBN to the United States Patent and Trademark Office, advising it not to accept the plaintiff’s application, was a preservatory measure aimed at protecting Nigeria’s interests, not a malicious act as claimed by the plaintiff.
Justice Omotosho, while rejecting the request, awarded costs of N50,000 against the plaintiff, to be paid to the CBN before the adjourned date for the hearing of the substantive suit. He fixed 26 June for the hearing of the substantive matter.
The Federal Ministry of Industry, Trade and Investment (FMITI), under the leadership of Honourable Minister Dr. Jumoke Oduwole, MFR, has reaffirmed its commitment to Nigeria’s economic transformation through a robust partnership with the Nigerian Exchange Group (NGX Group).
This collaboration was highlighted during the distinguished Closing Gong Ceremony at the NGX, Lagos, where Dr. Oduwole outlined FMITI’s ambitious target to facilitate $6 billion in foreign investment into Nigeria’s productive economy in 2025.
Oduwole was at the Nigeria Stock Exchange (NGX) on invitation by the Board and Management of Nigerian Exchange Group Plc (NGX Group) to perform the distinguished Closing Gong Ceremony on Nigerian Exchange, Lagos.
This symbolic ceremony, held on trading days, marks the formal close of the market and provides an excellent platform to showcase leadership, inspire stakeholders, and address critical economic issues.
Of the $6 billion target, $3 billion is projected to come from Foreign Direct Investment (FDI) into key sectors such as infrastructure, manufacturing, agribusiness, technology, and renewable energy.
These sectors are pivotal to creating jobs, promoting exports, and enhancing Nigeria’s productive capacity. Another $3 billion will be mobilized through Foreign Portfolio Investment (FPI) by leveraging innovative financial instruments like green bonds, diaspora-linked securities, and SME-focused platforms.
These efforts aim to deepen market liquidity and align capital flows with national priorities.
Oduwole emphasised the integral role of capital markets in driving economic resilience and sustainable growth, stating: “Deepening Nigeria’s capital markets is fundamental to improving investment flows, creating jobs, and sustaining long-term economic resilience.”
Ahonsi Unuigbe, Chairman of Nigerian Exchange Limited (NGX), reinforced the importance of this collaboration, noting that, “capital markets are powerful engines of innovation, business expansion, and economic inclusion, all of which are essential to advancing Nigeria’s industrialisation objectives.”
Temi Popoola, Group Managing Director/CEO of NGX Group, high – lighted the Exchange’s technologydriven vision.
“We are building a next-generation exchange ecosystem designed to de – mocratise investment opportunities, enhance market liquidity, and position Nigeria as a competitive destination for both domestic and international capital,” he said.
Partnership Opportunities and Achievements The engagement brought together key stakeholders from the capital market ecosystem, all of whom reaffirmed their commitment to supporting FMITI’s initiatives.
Notable areas of collaboration include: Strategic Listing of State Owned Enterprises (SOEs): Building on the successful corporatization of the Nigerian National Petroleum Company (NNPC), the listing of SOEs is expected to unlock significant value, enhance transparency, and deepen market liquidity.
Empowering SMEs: Efforts are underway to establish a dedicated capital market platform for small businesses, providing access to funding, capacitybuilding programs, and pathways for sustainable growth.
Green and Sustainable Finance: The NGX Impact Board is set to mobilize capital for high-impact projects through instruments like green and sustainability bonds, supporting climate resilience and infrastructure development.
The NGX Group also emphasized its role as a gateway to capital markets, offering a robust platform for cross-border investments.
This aligns with FMITI’s vision to restore investor confidence and attract foreign capital, as evidenced by the recent rebound in Foreign Direct Investment (FDI), which rose to $2.6 billion by Q2 2024.
A Shared Ambition for Nigeria’s Prosperity Speaking at the ceremony, Alhaji (Dr.) Umaru Kwairanga, Chairman of NGX Group, commended the Ministry’s leadership and bold reforms, which have set the stage for inclusive growth.
“By fusing policy innovation with market infrastructure, we can catalyze a new era of sustainable growth and national development,” he stated.
As Nigeria moves toward its $1 trillion GDP target by 2030, FMITI and NGX Group remain steadfast in their shared ambition to build a prosperous, inclusive, and resilient economy.
Together, they aim to align investments with national priorities, unlock the full potential of Nigerian enterprise, and create tangible opportunities for all Nigerians.
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