Africa possesses over $165 billion in readily available domestic capital to drive continental development and reduce dependence on volatile external funding sources, participants in a session during the African Development Bank's Annual Meetings heard Thursday.
Senior executives from major African financial institutions presented compelling evidence challenging long-held assumptions about the continent's capital scarcity during a high-profile panel discussion titled, "Leveraging Africa's Capital for Development Amidst Increased Economic Challenges."
The panel, moderated by Hassatou N'Sele, Vice President for Finance and Chief Financial Officer of the African Development Bank, formed part of key knowledge events at the Bank Group's 2025 Annual Meetings.
Abena Amoah, Managing Director of the Ghana Stock Exchange, delivered a striking revelation: "We have pension funds that just in West Africa, between Ghana and Nigeria, amount to almost $40 billion that is parking over 90 percent of their assets under management in government securities, saying they don't have investment opportunities."
Amoah revealed that in 2024, Africans invested $125 billion in cryptocurrency assets, with Nigeria alone contributing over $65 billion, making it the second-largest cryptocurrency investor base globally after India.
"Where did all that money go outside of the continent? And we talk about capital gaps," Amoah challenged, highlighting what she termed a critical paradox in Africa's development financing narrative.
Denys Denya, Executive Vice President of Africa Export-Import Bank (Afreximbank), showcased the institution's track record of mobilizing capital during global crises, having deployed over $22 billion in crisis response facilities over the past decade.
He said Afreximbank has revolutionized African capital mobilization through its Central Bank Depository Program, growing African institutional deposits from $14 million in 2014 to over $34 billion today.
"We have diversified our funding sources away from Euro markets, successfully raising capital in Japanese and Chinese markets this year," Denya stated, emphasizing the institution's strategic shift toward reducing dependency on traditional Western capital markets.
The panel recommended the urgent development of deep capital markets, emphasizing that African nations must prioritize building sophisticated financial markets to channel the continent's $40 billion in pension funds and retail savings toward productive investments.
Razia Khan, head of research, Africa and Middle East at Standard Chartered Bank, emphasized the critical need to address macroeconomic instability, volatile interest rates exceeding 20 percent in some markets, and regulatory bottlenecks that systematically exclude women and youth entrepreneurs from accessing capital.
Ibrahima Diouf, Special Advisor at the West African Development Bank (BOAD), called for immediate cultural and policy shifts: "We need our diaspora investing in Africa, but they can't do it if we ourselves are investing outside. This cultural transformation must happen now - Africa is where we need to invest."
Chika Mordi, chairman of United Capital, identified systemic barriers preventing transformational project financing, noting that when government borrowing rates reach 18-20 percent, rational banks choose risk-free government instruments over private sector development.
"We need stable macroeconomic environments, innovative profit-sharing mechanisms, and comprehensive risk mitigation instruments to unlock long-term capital for Africa's transformation," Mordi stressed.
Yann Le Pallec, President of S&P Global, announced a strengthened commitment to African markets, highlighting the continent's exceptional economic performance and critical role in the global energy transition.
According to the ratings agency, Africa is projected to achieve 4.8 percent GDP growth in 2025, which is significantly higher than the global average of 3 percent. This robust performance has been reflected in the agency's rating actions, with 11 positive sovereign rating adjustments across African nations in the previous year.
"Africa is at the core of real economic development as we speak," stated Le Pallec. "The continent is not only recovering from COVID-related challenges but is leapfrogging other regions, particularly in energy transition initiatives." He described the investment landscape as having abundant opportunities with suboptimal financial infrastructure.
Trade and Development Bank (TDB) Group President and Managing Director Admassu Tadesse pointed out inconsistencies in the global financial architecture, particularly regarding the treatment of trade finance in debt restructuring scenarios.
"While trade finance is internationally recognized as a protected asset class excluded from debt restructuring, we're seeing different treatment in African contexts," he noted. "This creates disincentives for both African and international financial institutions."
He also cited compliance burden concerns raised by international banks, with onerous regulations and disproportionate penalty structures deterring correspondent banking services in Africa.
Despite challenges, Admassu welcomed recent positive developments in international banking engagement with Africa, citing JPMorgan's significant entry into African markets and continued commitment from institutions like Standard Chartered.
He revealed the success of their experimental approach to creating investment opportunities explicitly tailored to African institutional investors' risk appetite and requirements.
"We moved beyond business as usual and established specialized funds designed for African institutional investors," said Tadesse. "What started as an experiment has exceeded our expectations, demonstrating a strong appetite for risk-adjusted, attractive investment opportunities on the continent."
N'Sele emphasized that Africa is not lacking in capital--only in mechanisms to channel it efficiently into development. "Africa possesses vast human capital, robust natural resources, and growing institutional capacity. The question is not whether the capital exists, but how we mobilize and deploy it to build resilient economies," she said.
Panelists unanimously agreed that overreliance on foreign aid and volatile global capital markets must give way to bold, domestic-led investment strategies.
"We talk about $2.1 trillion of assets under management from African pension funds, insurance companies, and sovereign wealth funds. But over 80 percent of that is locked into government treasuries -- funding recurring expenses, not capital development," said Solomon Quaynor, Vice President for Private Sector, Infrastructure, and Industrialization at the African Development Bank.
He amplified the call to end capital leakage from the continent. "If we are serious about stopping illicit flows, we would not need aid. Developed countries must partner with us -- many multinationals exploiting tax arbitrage are based in their jurisdictions."
"Innovation must be smart -- and it must scale. We must test within our development institutions, then expand what works across the ecosystem."
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