Coup contagion threatens new investment in Africa, AFC warns
The growing number of military takeovers in African states is raising concerns about stability and jeopardizing investment inflows into the continent, the Africa Finance Corp. said.
The Lagos-based development finance institution has suspended a project in one state that it has invested in, and may delay the planned listing of its African projects because of the retrenchment of democratic rule, Chief Executive Officer Samaila Zubairu said in an emailed response to questions. The AFC says it has an investment portfolio of about $11.5 billion in Africa.
The rise of the juntas in Africa is “very worrying, especially with seeming appeal of the changes to the mass populace,” Chief Executive Officer Samaila Zubairu said by email.
There have been nine coups in sub-Saharan Africa in the past three years, creating a belt of countries that stretches from the Atlantic Ocean to the Red Sea. Gabon joined the list last week, when soldiers removed President Ali Bongo from power after a disputed election.
AFC announced plans last year to sell shares in its projects on stock exchanges in London and the United Arab Emirates to raise capital and fund infrastructure development across Africa. Its investment portfolio includes stakes in port facilities in Gabon, Mauritania and Ghana, and power plants in Ivory Coast and Djibouti.
While it’s still working on “significant value enhancement” of the projects prior to listing, the political situation in the region will delay the timing of the listings, the CEO said.
“With all the coups in Africa today, now is not the time,” he said.
Founded in 2007, with headquarters in Nigeria, the AFC is owned by African governments and banks and private equity funds. It operates in at least 40 countries in the region.
