UK promises £8b to create jobs in Africa

Africa’s public and private set will enjoy £8 billion UK’s
 investment to create jobs and boost growth over the next four years

 

CDC Group, the UK’s Development Finance
Institution, will aim to invest up to £3.5 billion in Africa, supporting
hundreds of thousands of jobs.

 

The UK will aim to mobilise a further £4
billion of private investment for African countries, particularly from
the City of London.

 

The UK’s range of measures to boost
much-needed investment in businesses and infrastructure across Africa
was unveiled by the Prime Minister, Theresa May in Cape Town.

 

“This includes for the first time ever
setting a clear ambition of mobilising an additional £4 billion of
private sector investment into the continent by working more closely
with the City of London.’’

 

This comes as the Prime Minister has
today also set a new ambition for the UK to be the largest G7 foreign
direct investor in Africa by 2020.

 

Africa’s population is set to double by 2050 and as many as 18 million extra jobs a year will be needed.

 

There is a chronic need for private and
public investment to create better opportunities in Africa to prevent
the next generation falling further into poverty, potentially fuelling
instability and mass migration with direct consequences
for Britain.

 

But this growth also means that the scale
of the opportunity across Africa is huge: according to the IMF,
Africa’s GDP is set to reach $3.2 trillion in the next five years.

 

Home to the City of London, the world’s
leading financial centre, the UK is well-positioned to become Africa’s
future investment partner of choice. Initiatives announced today in
support of this include:

 

CDC, the UK’s Development Finance
Institution, will significantly increase its investment into Africa –
aiming to invest up to £3.5 billion in businesses on the continent over
four years. This will support hundreds of thousands
of jobs, build stability and trigger growth in some of the poorest and
most fragile countries.

 

A new investment of up to £300 million of
UK aid invested through the Private Infrastructure Development Group
(PIDG) will build essential infrastructure such as power, roads and
water, that will lay the foundations for new trading
and business opportunities across Africa in places businesses
previously would not have been able to operate.

 

International Development Secretary Penny
Mordaunt said: “Africa’s emerging markets offer huge untapped
potential to the UK. There is a massive shortage of investment,
infrastructure and jobs in these markets, and the City of
London is uniquely placed to help fill this gap while earning benefits
for the UK economy.

 

“We’re building mutually beneficial
partnerships which are helping to stimulate long-term transformational
growth and create good jobs for people in the world’s poorest countries,
while also allowing UK investors to access the
wealth of opportunity offered by African countries.’’

 

In addition to announcing a substantial
scale up of investment through CDC and PIDG, the UK is setting a clear
ambition to mobilise £4 billion of private investment, particularly from
the City of London. In total, UK initiatives
will generate up to £8 billion (around $10 billion) of investment for
African countries between 2018 and 2021.

 

The UK’s commitment to building bigger,
broader economic partnerships with African nations will prove a huge
benefit to UK business and investors, while also accelerating the
transformational growth needed to lift countries out
of poverty for good and to forge mutually beneficial partnerships
between the UK and African countries.

 

The City of London manages over £8 trillion of assets but at the moment only around 1% of those assets are invested in Africa.

 

This partnership will mobilise further
capital from pension funds, insurance companies and other investors,
enabling the City to take on an even greater role as Africa’s partner of
choice for financial services as the UK leaves
the EU.

 

This will create the opportunity to boost
investment returns for the UK’s pension pot, while triggering essential
long-term investment for African businesses, transforming the world’s
poorest nations into the UK’s trading partners
of the future.

 

As part of this new and distinctive offer
to work alongside, invest in and partner with African nations for our
mutual benefit, we will be bringing in more ‘Best of British’ experts
including extra investment specialists, to work
with African governments and businesses to unlock the private sector
finance so critical to sustained growth, job creation and tackling
poverty.