New Sub-Saharan Infrastructure Projects
Infrastructure projects deliver power, transportation, access to clean water and sanitation, and telecommunications, representing the foundation for a country or region's economic growth.
The challenge is that infrastructure projects require large sums of patient capital. Fortunately, institutional investors like pension funds and insurance companies often seek infrastructure's investment profile, which include steady, predictable returns over longer investment time horizons. Moreover, with institutional investors holding an estimated $70 trillion in assets, the deep reserves of capital are available on the global market. Yet, in sub-Saharan Africa, it is difficult to match this supply with demand given investors' differing investment mandates, risk tolerance and regulatory restrictions. To effectively mobilize this source of capital, USAID has partnered with NASP to draw in the financial and marketing expertise to reduce risks and expose investors to suitable investment opportunities. At a U.S.-- Africa Business Forum on September of 2016,USAID and the National Association of Securities Professionals (NASP) to kick off a two-year investment partnership seeking to mobilize critically needed institutional capital, both African and international, for infrastructure projects in Africa.
NASP is well positioned in the market, as the majority of its 500+ members either manage pension funds or advise institutional investors in the U.S. Under this partnership, USAID's Office of Private Capital and Microenterprise (PCM) and USAID/Southern Africa's Africa Private Capital Group (APCG) will, with NASP, convene African and U.S. institutional investors at two conferences in sub-Saharan Africa, facilitating relationships between local and U.S. investors. The partnership will also bring U.S. financial professionals to sub-Saharan Africa to help structure and advise on transactions and financial vehicles that support infrastructure development.
The PCM/APCG-NASP partnership exemplifies a mutually beneficial U.S.-Africa commercial and development relationship, where the U.S. brings more than investment dollars and also builds the capacity of local institutions. In support of the partnership, the Department of Commerce will also conduct outreach to U.S minority-owned businesses on resulting projects.
The U.S. Government's initial $7 billion commitment to Power Africa has mobilized more than $52 billion in additional external commitments, including more than $40 billion in private sector commitments to invest in power generation and distribution across sub-Saharan Africa. Read more about new commitments to Power Africa here. For updates on Power Africa, check out the Power Africa Tracking tool app here.