2021 Singapore Africa Business Forum: In Africa, challenges are the opportunities despite COVID-19

2021 Singapore Africa Business Forum: In Africa, challenges are the opportunities despite COVID-19
Akinwumi A. Adesina

The global COVID-19 pandemic should not dampen investor appetite in Africa. The continent remains an investment destination of choice despite the challenges, panelists at an opening session of the 2021 Africa Singapore Business Forum heard on August 23.

Trade between Singapore and Africa has been growing steadily over the past five years, with Singapore being among the top 10 investors in Africa. More than 100 Singaporean companies are currently operating across 50 African countries in the oil and gas, consumer, digital, agri-business and trade sectors.

Talking with Tharman Shanmugaratnam, Senior Minister and Coordinating Minister for Social Policies, African Development Bank President Akinwumi A. Adesina spoke about the global recession and disruption in African markets that Covid-19 had caused. But he voiced optimism about opportunities for investment. “You cannot ignore African markets…Africa is open to investors,” Adesina said, stressing that “the challenges are the opportunities.”

Asked about the sectors offering the most potential for investment, Adesina cited energy- renewable energy, such as mini and micro grids, solar, infrastructure and logistics.

The annual event identifies opportunities in key sectors and areas, including digital technology, financing, innovation, manufacturing, sustainability, and urban solutions.

Viswanathan Shankar, co-founder and CEO of Gateway Partners, moderated the conversation, called Leapfrogging the World: Innovation and Sustainability in Africa.

Shanmugaratnam urged Singapore investors to take both a short- and long-term view of the investment climate, which in his view saw Africa rebounding in the short term and continuing to be an important investment destination in the long term, with many still uncontested opportunities.

“Africa is quite different. Africa’s growth profile, it is an environment which is not dominated by large players… it is an open field…get a foothold get the right partners,” he said.

Digital Revolution, Africa Continental Free Trade Area, green growth

The digital and industrial revolution, Africa’s new free trade area agreement and green growth were also discussed during the session, as were other sectors offering good investment potential. Shanmugaratnam highlighted small and medium-sized enterprises as an overlooked sector because of the perceived risk associated with them.

“Africa is at the cusp of a connectivity revolution…it’s a huge opportunity,” he said. He gave the example of an innovative pilot platform that Singapore had signed with the Bank of Ghana, which links small and medium-sized enterprises with creditors and provides free exchange of information.

Adesina said the African Development Bank’s investment in training future generations through the coding for employment initiative was an example of its commitment to investing in human capital as the most important resource.

With the rapid spread of mobile telephone banking, Africa has demonstrated innovation in fintech and revolutionized payment systems. Mobile payment systems like Mpesa in East Africa are leading the world, Adesina said.

“Eighty percent of small and medium-sized enterprises own digital accounts…pay attention to this space,” he added. Asked about the African Continental Free Trade Area agreement, which is creating the largest free trade area in the world, Adesina said: “AFCTA is not just going to be a consumption zone. It’s got to be a manufacturing zone.”

Through its initiatives and policies, the African Development Bank is “driving growth that does not comprise the environment and tackling climate change,” Adesina added.

In closing comments, Shanmugaratnam encouraged Singapore investors to focus on what they are good at and to do it well. “Find the right partners, get a foothold…it’s going to be a beautiful rose in the years to come.”

Adesina concluded by saying: “Singapore is a friend of Africa. Take advantage of the welcoming platform that Africa has…the African Development Bank is there with you…derisking, co-financing.”

Earlier, Peter Ong Boon Kwee, Chairman of Enterprise Singapore, expressed optimism about the mutually beneficial relationship between Singapore and the African continent, citing 18 partnerships that were signed just as the Forum opened.

Organized by Enterprise Singapore, the Africa Singapore Business Forum is the premier platform for promoting business exchange and thought leadership between Africa and Asia.  It has brought together over 2,000 business and government leaders from 30 countries to explore partnerships and growth opportunities between both sides.


Leave a Reply