“External dependency is not a good development strategy,” warns AfDB in its 2025 economic outlook. Despite last year’s 75% FDI surge, leaner times loom as US tariffs and geopolitical rifts trigger aid cuts and subdue global economic activity. Africa must look within to trillions in untapped domestic capital – in pension funds, sovereign wealth vehicles, insurance assets, commercial banks, fintech platforms, and foreign exchange reserves – while leveraging hybrid instruments and transforming 1.55bn Africans into active capital market participants. How can a debt-burdened continent harness this vast capital pool and growing population to build financial strength and fund under-resourced MSMEs, vital energy infrastructure, and digital innovation?
Key points:
- Institutional capital: What business case will lure insurance, pension and sovereign wealth funds from their heaven of government debt into backing private sector growth?
- How can the financial sector support local champions in sectors where international companies dominate: natural resources, energy, logistics, trade finance?
- Where can fintech and digital platforms have the greatest impact in channelling domestic savings into productive investments?