The global consensus on the imperative of addressing the large financial deficit on Africa’s infrastructure is well documented. This is clearly articulated in academic literature as well as in the high-level policy forums at the African Union, United Nations, World Bank, OECD, G 20 and many others. With global regulatory regimes shifting and somewhat diminishing the ability of traditional capital to channel investments into assets in Africa, institutional investors in the form of Pension and Sovereign Wealth Funds have emerged as the most ideal financing sources to close the estimated $50 billion infrastructure investment gap that is needed annually.
However, in order to effectively mobilise institutional investors, a variety of issues need to be addressed to strategically and intentionally facilitate long-term allocations and investment into the African infrastructure market. Chief amongst these matters is the need for initiatives around the regulatory frameworks guiding institutional investment in Africa; specifically, the development of capital market products that can effectively de-risk African infrastructure and package it as an investable asset class.
