Leaders and policymakers at the recently concluded Africa Forward Summit in Nairobi have called for urgent reforms to the global financial system, warning that Africa continues to face unfair borrowing conditions that hinder industrialisation and economic growth.
One of the key issues raised during the summit was the disproportionately high cost of capital facing African countries, which speakers described as being driven by unfair risk assessments and what was termed a “prejudice premium” attached to investments on the continent.
“Africa continues to bear a disproportionate cost of capital, driven largely by unfair risk assessment and the attendant prejudice premium,” summit participants stated.
According to discussions at the summit, the current international financial architecture continues to restrict Africa’s economic potential through high borrowing costs, restrictive financing conditions, limited access to long-term capital, and inadequate funding for productivity and value addition.
“The current global financial system limits Africa’s ability to industrialise due to high borrowing costs, restrictive financing terms, limited access to long-term capital, and inadequate financing for productivity and value addition,” speakers noted.
Participants also stressed that African countries must strengthen governance, improve policy stability, uphold the rule of law, and create investment-friendly systems capable of attracting sustainable investments.
“Africa must also do more internally to strengthen governance and policy stability, create investment-friendly systems, respect contracts and the rule of law, and deepen regional integration,” the summit heard.
Speakers warned that fragmented markets across the continent weaken Africa’s competitiveness in the global economy and called for stronger economic cooperation among African nations.
“Fragmented small markets cannot compete effectively in an integrated global economy,” participants said.
The summit further advocated greater mobilisation of Africa’s own financial resources, including pension assets, while positioning the continent to attract a share of the more than $120 trillion in global private capital currently seeking investment opportunities.
“With over $120 trillion in global private capital seeking opportunities, Africa must position itself as an investment destination, not just a development conversation,” participants declared.
Leaders at the summit also called for a shift in financing priorities away from the extraction of raw materials and emergency funding toward investments in infrastructure, technology, innovation, skills development, regional value chains, and industrial productivity.
“The focus of financing must shift from merely extracting raw materials and funding emergencies to enabling value addition, infrastructure, skills development, regional value chains, technology and innovation,” the summit stated.
Participants concluded by emphasising that the continent’s long-term prosperity depends on productivity, regional integration, and sustainable value creation.
“Africa’s future will not be built on dependency, but on productivity, integration, and value creation,” they said.
The Africa Forward Summit brought together political leaders, policymakers, investors, and development stakeholders to discuss pathways for accelerating Africa’s economic transformation and long-term growth.