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Nqobile Bhebhe, [email protected]

GLOBAL firms are keen to invest in Africa’s key economic sectors, offering the continent a unique opportunity to capitalise on the African Continental Free Trade Area (AfCFTA), Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube.

Agro-processing, information infrastructure, and the banking sector have been identified as key investment targets.

Following the recent World Economic Forum in Davos, Switzerland last week, Prof Ncube noted that Africa is becoming a highly attractive investment destination.

He led the Zimbabwean delegation and also attended the event as the chairman of the committee of African Finance ministers.

“We had companies that have invested in some sectors seeking to expand in Africa, focusing on agro-processing, the beverages sector, for example, port and rail logistics, the banking sector, telecommunications and the digital tech companies,” he said.

“All of them are present in Africa, and they are trying to expand and they are looking to ask the governments to give them the right incentives to invest in Africa.

“But what came out was that the beverages companies are interacting well, forging backward linkages with the primary sector, being the agricultural sector. We see the synergy between the beverages companies and the primary agricultural sector,” said the minister.

“Those in telecommunications, of course, they want less regulation. They want it easier to operate in their countries in terms of the regulatory environment. They want support for investing in physical infrastructure, whether it’s fibre optics, base stations and so forth.”

Prof Ncube said the potential investors want support in terms of building data centres, which are critical for investment in artificial intelligence and the whole digitalisation economy. The banking sector is also under spotlight.

“They want to expand in Africa and deepen financial inclusion in Africa, and they also are looking for an easier regulatory environment. What really came out was the opportunity that has been offered by African Continental Free Trade Area,” he said.

“What is needed is a digitalisation of Africa, especially in terms of digital payments across borders and this is where for instance the African Development Bank initiative is critical for facilitating payments for trade across Africa and generally digitalisation is the way to go,” said Prof Ncube.

The AfCFTA is one of the flagship projects of African Union Agenda 2063 and it seeks to create a single continental market, with a population of about 1,3 billion people and a combined Gross Domestic Product of approximately US$3,4 trillion.

The AfCFTA is the world’s largest new free trade area since the establishment of the World Trade Organisation (WTO) in 1994.

Prof Ncube said the development of sound digital infrastructure is critical for African governments to focus on for rapid economic development.

“You find that our youth are very active in digitalisation and this is a positive thing. It means that if there’s a sector or economic activity where the youth are involved we should also spend a lot of time as governments in Africa supporting that sector,” he said. 

“Clearly, Africa is turning out to be a very opportune target for investment by the global community.”