Africa needs stronger value proposal for investors

Bonga Mokoena
Bonga Mokoena

JOHANNESBURG: Leading financial services group, Alexander Forbes has urged African countries to gel around a coherent economy in order to achieve the continent’s growth imperatives and at the same time rise up to the challenge of global super economies.

Briefing the media here recently, Alexander Forbes CEO (Emerging Markets), Bonga Mokoena said achieving this would require a compelling plan, which would also incorporate national sovereignties.

“This is where political will to recognise that Africa is a continent provides a stronger value proposition than Africa as a set of independent entities.

“How African nations respond to the opportunities being offered through the Continental Free Trade Agreement will tell the tale for its future,” he said.

For his part, Alexander Forbes’ managing executive (Coverage), Craig Bentley said impact investing was potentially the best option for Africa’s growth. Impact investing refers to that made into companies, organisations, and funds with the intention of generating a measurable, beneficial social or environmental impact alongside a financial return.

“If African countries are going to meet their long-term ambitions and Sustainable Development Goals imperatives, all stakeholders including governments, employers, multinationals, foreign investors and individuals will have to rethink exactly how funds will need to be redeployed to get the greatest multiplier impact on their investments,” he said.

Bentley said this applies to pension fund savings, foreign direct investment, social security programmes and corporate spending in equal measure, and would have to be a collaborative consideration.

Alexander Forbes Research Institute head, Anne Cabot-Alletzhauser said Africa is cited as offering investors exposure to some of the best economic growth opportunities globally, although this masks a more problematic reality.  Cabot-Alletzhauser noted that the record shows that few African nations have been able to convert that growth in GDP to inclusive, sustainable outcomes for their broader populations.

“In many respects, this failure to translate a country’s economic growth into financial wellness and financial stability for its citizens is a function of failed institutions and failed governance.  “We need to pay close attention to how the trends on overall governance are playing out for different countries on the continent,” she said.

Alexander Forbes is a specialised financial services group focussing on employee benefits solutions for institutional clients, financial well-being and retail financial solutions for individual clients, in particular employees of the group’s institutional clients.

Services provided include retirement funds and asset consulting, actuarial, investment and administration services, employee risk benefits and healthcare consulting, personal lines insurance, individual financial advisory and multi-manager investment solutions.

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