German companies to invest $1 billion in Africa

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German-African Business Association (Afrika-Verein) has resolved to invest more than $1 billon in Africa in 2018.
 
This would be 10 per cent increase of total investment, compared with that of previous year.
 
Many of the larger German corporates such
as Siemens, Volkswagen, Bayer, and many others, are expanding
activities in Africa significantly.
 
In order to convince many of the hundreds
of thousands of German SMEs to follow, they will need a bit of support
from German Government as far as guarantees, export credit insurance and
financing means are concerned.
 
The Chairman of the German-African
Business Association, Dr. Stefan Liebing, who revealed German
Chancellor, Angela Merkel, visits Nigeria this week, urged the Nigeria
to “speed up its reform actions” in order to boost trade relation
between the two countries.
 
Praising Nigeria for efforts to change the country’s narrative, he said: “I strongly believe Nigeria is on a very good path.”
 
According to him, the level of German investment and trade with most African countries has slowed down in the past four years.
 
He attributed the decline to various
reasons such as the decline in crude oil and other commodities prices,
and the German business’ hesitant posture to African countries, caused
by ownership of businesses by potential investors
running “family-owned medium sized businesses, rather than large
state-backed corporates, among others.
 
Liebing affirmed that the trend would
change, saying Germany had for the first time ever overtaken France as
Africa’s most important trade partner.
 
“But it will also help the government of
Nigeria to continue its reform path at full speed. There is huge
competition for German investment around the world and money will move
where it finds the best and most stable, corruption-free
framework.”
 
“First of all, I strongly believe that
Nigeria is on very good path now. Reform has started in many areas,
including the fight against corruption. Diversification of the economy
away from what used to be heavy dependence on oil
revenues is important also.
 
“And what maybe the most important
development is that we are working with highly competent and motivated
leaders from Government and business as we discuss and negotiate major
projects between the two countries.”
 
He noted that security in Nigeria has
improved significantly, saying that was the first condition for
investors to visit the country.
 
However, during Merkel’s visit, Liebing
said he expects to see the signing of a couple of agreements between
Nigeria and Germany to strengthen their bilateral relation.
 
“I hope to see as many agreements being
signed as possible. We have quite a number of serious projects developed
by some of the most reputable German corporates and we hope that we can
bring them to
 
“It is my strong belief that we need to
deliver a few pilot projects first. Once German investors have a proof
that projects can be delivered quickly and successfully in a stable
environment, I am sure many others will follow
them on the way to Nigeria.
 
“So my wish for this visit is to push
these pilot projects to success to the degree possible and make the
meeting between the political leaders a starting point for a new level
of business cooperation,” he added.
 
He stressed that the increase in
activities and interest of Germans in almost all African countries would
make the country renew its commitment and investment in Africa after
the visit, noting that in the next five years, the
number of German companies operating in Nigerian would have doubled.
 
“Chancellor Merkel has picked Ghana,
Senegal and Nigeria for the visit both for their political importance in
the region but also because they are strong economies that offer huge
opportunities for joint investment, trade and
development.
 
“As I said before, we believe that a 10
per cent increase of German investment in Africa should be possible this
year. If Governments do their part and provide a stable environment and
certain guarantees for investors, then I
believe we can move to a 30 per cent increase by the end of 2021,” he
added.