Africa Continental Investor Convening: Partnering for SDG Investments in the Green & Blue Economy in Pursuit of Agenda 2063
September 8, 2022
TICAD8 Side-Event | Co-organized by UNDP and AfDB
Tuesday, 6 September 2022 | 07:00 - 8:40 am (EDT) / 14 - 15:40 pm (EAT)
UNDP Deputy Assistant Administrator and Officer-in-Charge, Regional Bureau for Arab States
Ladies and Gentlemen,
Alongside our valued partner, the African Development Bank, it’s my great pleasure to co-host and open this Africa Continental Investor Convening, organized as a side event of TICAD 8.
This side event today is very timely, as green investment is the theme of our Forum, and has featured prominently at the TICAD 8 summit. As the African continent is experiencing severe economic, social and environmental consequences of climate change, increased investment in the green and blue economy will help improve the livelihoods of all African people. , This is consistent with Japan’s development focus on “Investment in people” and “the quality of growth,” as announced by the Prime Minister of Japan during the summit.
This forum allows us to leverage the power of the Japanese business community, and work with distinguished representatives of African Governments, national counterparts, development partners, and private sector, many of whom we are delighted to see today.
Sustainable finance is critical for achieving the Sustainable Development Goals. It lies at the core of development cooperation and our work at UNDP as we support governments and partners across the globe to put the SDGs at the heart of public and private financing systems.
Yet today the global annual SDG financing gap has grown to USD 3.7 trillion—up from USD 2.5 trillion before COVID-19.1
In Africa, where the pandemic has hit economies and societies severely, COVID-19 recovery is estimated to cost USD 153 billion – on top of a pre-existing annual SDG financing gap for the continent of USD 200 billion.2
Indeed, Official Development Assistance has declined in many countries that still need support and has concentrated in just a few, mainly for humanitarian support.
In contrast, Foreign Direct Investment flows to developing countries have increased, totalling USD 427 billion in the first half of 2021.
However, FDI to structurally weak and vulnerable economies declined due to the pandemic, precipitating a decline of FDI flows to Africa by 16% to USD 40 billion – a level last seen 15 years ago.3
Here, I would remind you that the issue is not that we do not have enough money. This is a world with $1.54 quadrillion—with a ‘Q’—in assets. The real issue is where money is spent and by whom, and who benefits or not.
Only 20% of capital is held in developing countries, which are home to 84% of the world’s population.4
This is particularly pertinent for Africa, with it’s rapidly urbanizing and growing young population.
This development financing challenge may seem daunting, but I am encouraged by the huge untapped energy every time I travel across this continent.
And I believe that global finance, has an instrumental role to play in closing the SDG financing gap, in collaboration with governments, the private sector, civil society and citizens.
Globally, just 7% of the USD 100 trillion of global assets managed annually by institutional investors would enable us to achieve the SDGs.
This is also less than the amount changing hands daily in capital markets around the world.
The SDGs are estimated to generate 12 trillion in market opportunities.
While private sector enterprises are increasingly recognizing the immense potential in sustainable investment opportunities, across Africa more needs to be done to create the enabling conditions, to enhance capacity and channel financing for private enterprises to adapt their business strategies towards sustainable and SDG positive models.
But ensuring that private sector contributes effectively to achieving the SDGs can requires us to develop innovative solutions for blended financing as well as supporting Government to improve their regulatory frameworks to attract private investments.
Our strategic ambition at UNDP is to expand impact investing from a niche market to the mainstream by re-directing investment flows towards proven SDG-aligned investments.
That is why we have developed SDG Investor Maps as a market intelligence tool, produced locally with governments and partners across some of the 170+ countries where we operate.
These Maps identify investment opportunity areas with proven business models that are commercially viable and aligned with national development priorities.
They help us to guide investors’ decision-making towards the SDGs and direct capital to where it is most needed, as part of the broader integration of public and private as well as domestic and international financing streams.
As of today In Africa, UNDP has completed SDG Investor Maps in 9 countries to date, while finalizing such Maps in 6 other countries. And we are keen to support more countries who are interested in our initiative!
The 15 African SDG Investor Maps identify 245 investment opportunities, half of which are geared towards the green and blue economy—the focus of this event—where there is immense opportunity in energy, transport, agriculture, and forestry, as well as in fisheries and marine and coastal resources.
We are excited to showcase a sample of the investment opportunities identified through our African SDG Investor Maps in today’s event.
And we look forward to contributions from our spotlight countries Djibouti, Mauritius and Nigeria; with many thanks to national counterparts present here as they demonstrate how their countries are ready for SDG investments.
Through our distinguished panel, we will discuss how private and public institutions can support the acceleration of investments in the green and blue economy, drawing on country examples and capitalizing on regional integration opportunities, particularly the African Continental Free Trade Agreement.
The panel will also showcase how the Japanese private sector can help realise African investment opportunities, and the role Government and development partners can play in guiding private capital to where it can make a greater difference for people and planet.
Thank you for joining us today, and I look forward to our discussions on this important topic.
1 OECD, Global Outlook on Financing for Sustainable Development (2020)
2 UNCTAD, Economic Development in Africa Report (2020)
3 UNCTAD, World Investment Report 2021 (2021)
4 OECD, Global Outlook on Financing for Sustainable Development 2021: A New Way to Invest for People and Planet (2020)