The need is enormous. Power, airports, ports, highways – Africa has a huge gap to bridge before its economies can come close to the efficiency of competing continents like Asia.
For banks and money managers, it’s an opportunity with unparalleled upside in a world of negative interest rates. Investors are lined up.
So why aren’t more projects getting done, more infrastructure bottle-necks being busted?
There’s no issue around finding capital to fund these big projects, according to David Law, the head of corporate finance for Africa, the Middle East and Pakistan at Standard Chartered Bank. The challenge is getting projects “bankable.”
Bringing projects to a point where funds can flow takes time – and talent. “There are clearly a lot of projects that need to be done,” says Law. The biggest issue is getting more expertise on the ground – and that takes getting “Africans back to Africa to help us marry and close these gaps,” says Law. “We see a lot of projects. We can’t devote ourselves to them until they’re at a point where we know the right people are behind them, the right expertise is there to develop them.”
While the “Africa Rising” story may have somewhat stalled, there are still “tremendous” opportunities from the continent’s burgeoning middle class and wealth in commodities “that the world will still need,” says Law.
Among the most exciting are the delivery services building up around mobile phones. “One of the dangers for incumbent banks,” says Law, “is that we actually at the retail end get disintermediated by new platforms, new technology. Africa is a continent that could just change overnight and transform retail banking.”
Justin Villamil’s interview with David Law is part of a series of podcasts with African business experts as part of a collaboration between Frontera News and the London School of Economics’ LSE Africa Summit.
Listen to the interview:
Hear more podcasts from Frontera News and the London School of Economics’ LSE Africa Summit:
When Africa Says No to Exploitation: Isaac Odoom from the University of Alberta gets to the root of unexplored tensions between African local community interests, governments and foreign investors.
Paying Soldiers with Mobile Money: The head of Airtel Money in Kenya, Topyster Muga, explains how its mobile money platform is proliferating – from paying soldiers in the DRC to new markets in Romania and Albania.