Economy

NEPAD Launches 5% Agenda Scheme to Bridge Africa’s $68b Infrastructure Finance Gap

Published

8 years ago

19/09/2017

By Dipo Olowookere

The 5 percent agenda campaign of the New Partnership for Africa’s Development (NEPAD) was eventually launched on Monday, September 18, 2017.

The initiative is aimed at bridging the $68 billion infrastructure finance gap in Africa.

NEPAD is African Union’s economic development programme and the launch of the 5 percent agenda scheme gathered international investors and CEO-level business leaders at the NASDAQ Stock Market.

The launch took place five years after a January 2012 African Union Summit adopted the Programme for Infrastructure Development in Africa (PIDA) which sets out 51 cross-border infrastructure programmes and more than 400 actionable projects in four sectors.

According to the World Bank, the continent needs to spend $93 billion annually (44 percent for energy; 23 percent for water and sanitation; 20 percent for transport; 10 percent for ICTs; and 3 percent for irrigation) until 2020 to bridge its infrastructure gap, which is currently removing an estimated 2 percent of GDP growth every year.

On the other hand, Africa only managed to close 158 project finance deals with debt totalling $59 billion over the decade 2004-2013, which represents only 5 percent of infrastructure investment needs and 12 percent of the actual financial flows.

The 5 percent Agenda campaign highlights that only a collaborative public-private approach can efficiently tackle these issues and calls for allocations of institutional investors to African infrastructure to be increased to the declared 5 percent mark.

Speaking at the launch event in New York, Ibrahim Assane Mayaki, NEPAD Chief Executive Officer, commented: “Infrastructure plays a leading role in supporting growth on the continent. At the same time, it can represent an innovative and attractive asset class for institutional investors with long-term liabilities.

“By launching the 5 percent campaign in New York today, we invite investors to take advantage of the wide-ranging opportunities Africa has to offer and to move forward with what can only be a win-win partnership.”

The launch of the campaign gathered high-level international investors and business leaders, including members of the PIDA Continental Business Network (CBN) which is spearheaded by NEPAD and constitutes a CEO-level private sector infrastructure leaders dialogue platform on PIDA.

Mr Tony Elumelu, one of Africa’s most prominent entrepreneurs and active participant in the CBN said: “Africa is getting stronger every day with new business opportunities and innovative ideas but what is still crucially missing is project implementation.

“A coherent and coordinated approach is needed to mobilize institutional investors while limiting their risk exposure. African governments need to work on creating conducive environments to attract these investments which are so vital for the continent’s growth and development.”

According to a 2016 McKinsey report, institutional investors and banks have $120 trillion in assets that could partially support infrastructure projects.

Now more than ever, Africa needs to tap into this available. As banks face additional regulatory challenges and as governments have limited fiscal space, it is becoming increasingly urgent to unlock additional flows from long-term institutional investors such as insurers, pension funds, and sovereign wealth funds.

For pension and sovereign wealth funds to be able to invest in large-scale infrastructure projects in Africa, a variety of issues need to be addressed to strategically and intentionally facilitate long-term allocations. Chief amongst these matters is the need to reform national and regional regulatory frameworks that guide institutional investment in Africa.

Likewise, new capital market products need to be developed that can effectively de-risk credit and hence, allow these African asset owners to allocate finance to African infrastructure as an investable asset class to their portfolio.

All these issues are at the heart of the 5 percent Agenda roadmap, which is the backbone of NEPAD’s campaign and is foreseen to have the following impact unlocking notable and measurable pools of needed capital to implement regional and domestic infrastructure projects on the continent; broadening and deepening the currently very shallow African capital markets, whilst at the same time contributing significantly to regional integration and job creation; promoting the development of innovative capital market products that are specific to the continent’s challenges and potential in regards to infrastructure development; and raising the investment interest of other institutional and non-institutional financiers that so far have been hesitant to include African infrastructure projects as an asset to their investment portfolio based on specific, concrete next steps and project suggestions.

Economy

Linkage Assurance, Oando, Others Lift Nigerian Exchange by 0.10%

Published

1 day ago

22/03/2025

Dipo Olowookere

By Dipo Olowookere

The Nigerian Exchange (NGX) Limited returned to green territory on Friday, closing higher by 0.10 per cent after investor sentiment turned bullish.

Business Post reports that the market breadth index was positive yesterday after the bourse ended with 29 appreciating equities and 21 depreciating equities.

Linkage Assurance gained 10.00 per cent to trade at N1.43, Livestock Feeds appreciated by 9.93 per cent to N8.41, Mutual Benefits jumped by 9.84 per cent to 67 Kobo, UBA soared by 5.75 per cent to N36.80, and Oando grew by 5.59 per cent to N51.00.

Conversely, Red Star Express lost 9.91 per cent to finish at N4.82, Learn Africa depreciated by 9.85 per cent to N3.02, FTN Cocoa declined by 9.43 per cent to N4.80, Coronation Insurance slumped by 9.39 per cent to N2.22, and Ikeja Hotel slipped by 9.35 per cent to N9.70.

Customs Street grew yesterday as a result of buying interest in banking equities, which dominated the activity chart, according to data from the bourse.

Fidelity Bank transacted 62.3 million shares for N1.1 billion, Access Holdings traded 38.3 million equities worth N843.7 million, Tantalizers sold 32.0 million stocks valued at N99.2 million, Veritas Kapital exchanged 31.4 million shares worth N38.4 million, and Zenith Bank traded 22.7 million equities valued at N1.1 billion.

At the close of trades, a total of 397.2 million stocks worth N14.2 billion exchanged hands in 10,099 deals compared with the 310.5 million stocks valued at N6.3 billion traded in 10,182 deals a day earlier, indicating a decline in the number of deals by 0.82 per cent, and the growth in the trading volume and value by 27.92 per cent and 125.40 per cent, respectively.

The industrial goods and commodity sectors remained unchanged during the session, the insurance and consumer goods indices tumbled by 0.49 per cent and 0.02 per cent apiece, while the energy and banking counters went up by 0.50 per cent and 0.12 per cent, respectively.

The bargain-hunting activities of the market participants lifted the All-Share Index (ASI) on Friday by 104.19 points to 104,962.96 points from 104,858.77 points and the market capitalisation increased by N66 billion to N65.820 trillion from N65.754 trillion.

Economy

Nigerian OTC Securities Exchange Falls 0.44%

Published

1 day ago

22/03/2025

Adedapo Adesanya

By Adedapo Adesanya

The last trading session this week at the NASD Over-the-Counter (OTC) Securities Exchange ended on a negative note with a 0.44 per cent decline on Friday, March 21.

The market capitalisation of the OTC securities exchange went down by N8.67 billion to N1.939 trillion from N1.948 trillion and the NASD Unlisted Security Index (NSI) ended the session at 3,358.61 points after dropping 15.01 points from the preceding day’s 3,373.62 points.

Trading data showed an increase of 50.7 per cent in the volume of securities transacted to 304,188 units from the 201,873 units transacted in the previous trading day, the value of transactions surged by 1,214.8 per cent to N10.2 million from N776,509.51, and the number of deals rose by 88.2 per cent to 32 deals from 17 deals.

Yesterday, FrieslandCampina Wamco Nigeria Plc lost N1.84 to trade at N37.17 per share versus Thursday’s closing price of N39.01 per share, Central Securities Clearing System (CSCS) Plc depreciated by N1.01 to sell at N22.84 per unit compared with the preceding day’s N213.85 per unit, and Afriland Properties Plc declined by 2 Kobo to close the day at N19.50 per share versus the previous session’s N19.52 per share.

At the close of trading activities, Impresit Bakolori Plc was the most active stock by volume on a year-to-date basis with 533.9 million units worth N520.9 million, followed by Industrial and General Insurance (IGI) Plc with a turnover of 69.9 million units valued at N23.7 million, and Geo Fluids Plc with 44.1 million units sold for N88.9 million.

Similarly, Impresit Bakolori Plc was the most active stock by value on a year-to-date basis with a turnover of 533.9 million units worth N520.9 million, trailed by FrieslandCampina Wamco Nigeria Plc with the sale of 13.2 million units valued at N511.8 million, and Afriland Properties Plc with 17.6 million units sold for N360.1 million.

Economy

Naira Sinks Further to N1,537.05/$1 at Official FX Market

Published

1 day ago

22/03/2025

Adedapo Adesanya

By Adedapo Adesanya

The value of the Naira depreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Friday, March 21 by N2.72 or 0.18 per cent to settle at N1,537.05/$1 compared with the preceding day’s N1,534.33/1$.

In the same official FX market, the exchange rate of the Nigerian Naira and the Pound Sterling and the Euro remained unchanged at N1,972.89/£1 and N1,657.81/€1, respectively.

At the parallel market segment, the local currency tumbled against the Dollar during the trading session by N5 to trade at N1,590/$1 versus Thursday’s closing price of N1,585/$1.

The pressure on the market continued as the Dollar strengthened in the international market, making currencies like the Naira weaker.

The continuous downward trend of the Naira has raised concerns about the effectiveness of recent injections into the market even as the Central Bank of Nigeria (CBN) channeled more than $55 million into the banks during the week.

In the cryptocurrency market, most tokens as prices inversed with the wider financial markets, which are down on tariff worries and decreased corporate earnings.

On the regulatory front, the US government is moving towards a market structure bill that has been touted as historic.

Solana (SOL) appreciated by 1.2 per cent to sell at $129.31, Dogecoin (DOGE) rose by 0.9 per cent to $0.1692, Ethereum (ETH) went up by 0.9 per cent to $1,988.34, and Ripple (XRP) added 0.8 per cent to close at $2.40.

Further, Bitcoin (BTC) expanded by 0.6 per cent to $84,293.76, Binance Coin (BNB) increased by 0.4 per cent to $631.94, and Cardano jumped by 0.3 per cent to end at $0.7134.

On the flip side, Litecoin (LTC) went down by 1.8 per cent to $91.25, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.