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Zawya
5 days ago
- Business
- Zawya
AFC says Africa has $4trln local capital available to fund infrastructure
African governments should turn to an estimated $4 trillion in capital held by domestic institutions like pension funds to develop much-needed local infrastructure as external funding sources wane, the Africa Finance Corporation said on Thursday. Building railways and expanding power generation are major priorities for the continent as its population and economies grow, but traditional sources of funding such as foreign direct investment and official development assistance are proving "increasingly insufficient", the AFC said. Higher interest rates globally, declining donor budgets and protectionist policies in advanced economies are further tightening the availability of funds, it said in the report. "These developments underscore Africa's need for a more resilient and internally anchored financing strategy," the financier, which is owned by African governments, multilateral lenders and private funds, said. African governments are also struggling to find space within national budgets to pay for development projects as interest payments gobble up an ever-rising share, the report said. They can however turn to the potentially trillions of dollars in domestic capital held by sovereign wealth funds, pension funds, and central and commercial banks, it added. These are currently held by institutions or invested in short-term liquid instruments like money markets due to legal restrictions on where assets such as pension funds can be invested, it added in the report. To unlock these funds, African governments will have to modernise huge swathes of their economies that are not taxed and regulated, and reform the rules around pension funds to allow them to invest in long-term infrastructure projects, AFC said. They will also need to boost national savings rates, which on average stand at half those of Asian nations, it added. The African Development Bank, a shareholder in AFC, has pegged Africa's annual financing gap for structural transformation at more than $400 billion, or nearly 14% of the continent's projected GDP by 2030. (Reporting by Duncan Miriri; Editing by Jan Harvey)
Reuters
5 days ago
- Business
- Reuters
AFC says Africa has $4 trillion local capital available to fund infrastructure
NAIROBI, June 5 (Reuters) - African governments should turn to an estimated $4 trillion in capital held by domestic institutions like pension funds to develop much-needed local infrastructure as external funding sources wane, the Africa Finance Corporation said on Thursday. Building railways and expanding power generation are major priorities for the continent as its population and economies grow, but traditional sources of funding such as foreign direct investment and official development assistance are proving "increasingly insufficient", the AFC said. Higher interest rates globally, declining donor budgets and protectionist policies in advanced economies are further tightening the availability of funds, it said in the report. "These developments underscore Africa's need for a more resilient and internally anchored financing strategy," the financier, which is owned by African governments, multilateral lenders and private funds, said. African governments are also struggling to find space within national budgets to pay for development projects as interest payments gobble up an ever-rising share, the report said. They can however turn to the potentially trillions of dollars in domestic capital held by sovereign wealth funds, pension funds, and central and commercial banks, it added. These are currently held by institutions or invested in short-term liquid instruments like money markets due to legal restrictions on where assets such as pension funds can be invested, it added in the report. To unlock these funds, African governments will have to modernise huge swathes of their economies that are not taxed and regulated, and reform the rules around pension funds to allow them to invest in long-term infrastructure projects, AFC said. They will also need to boost national savings rates, which on average stand at half those of Asian nations, it added. The African Development Bank, a shareholder in AFC, has pegged Africa's annual financing gap for structural transformation at more than $400 billion, or nearly 14% of the continent's projected GDP by 2030.
Malay Mail
22-05-2025
- Business
- Malay Mail
Gold, gas and god complexes: Trump's trillion-dollar desert hustle — Che Ran
MAY 22 — It wasn't a peace mission. It wasn't diplomacy. It wasn't even subtle. Trump's recent tour through the sand-slicked palaces of Riyadh, Doha, and Abu Dhabi looked more like a Vegas residency meets a Davos roadshow. Three of the world's richest autocracies rolled out gold-plated carpets, offering up more than US$3 trillion (RM12 trillion) in investment pledges — yes, trillion with a 'T' — to a man who wears power like a reality show crown and sells the American dream like a used Cadillac with bullet holes in the backseat. This wasn't about regional stability. It was branding. Trump-style. He wasn't exporting freedom or democracy. He was flogging 'America First' as a global franchise — one where the golden arches are replaced by golden handshakes and sovereign wealth funds. And why not start with the Gulf? The petro-princes had the cash, the desperation, and the disdain for red tape. Forget the broken glass of Baghdad or the rubble of Aleppo. This was the soft leather boardroom version of imperialism, where the warlords wear Rolexes and the bombs drop in the form of bond deals and trade concessions. When the house always wins For all its swagger, Brand America has been battered. Its legacy in the Middle East reads like a mafia rap sheet: botched wars, drone weddings, waterboard diplomacy, and a Wall Street meltdown that left half the planet in economic shambles. Add a bloated US$36 trillion national debt and a cultural civil war back home, and it starts to look like a nation selling snake oil with a Harvard label. So, Trump did what any washed-up frontman would do — he booked the Gulf leg of his redemption tour and went fishing for liquidity. But this wasn't just a fundraising drive. This was an audition for Act Two of Pax Americana: the sequel nobody asked for, filmed on the same scorched set, with the same oil-soaked script. Behind the scenes, there's a deeper fear. The Brics bloc is getting louder. China isn't just rising; it's rewriting the rules. And that once untouchable symbol of American dominance — the dollar — now wears a bullseye. Some of Trump's own whisperers have begun suggesting that the greenback's reserve currency status is less a flex and more a ball and chain. But let's not kid ourselves. Washington isn't letting go of that dollar sceptre any time soon. It's just pretending it might — like a junkie threatening to quit while reaching for another hit. Syrian President Ahmed al-Sharaa meets with US President Donald Trump and Saudi Crown Prince Mohammed Bin Salman in Riyadh, Saudi Arabia, May 14, 2025. — Reuters pic Shake hands, sell arms, skip Tel Aviv The Middle East is still the great geopolitical casino. Trump wants to manage the house again. He knows instability sells arms and headlines, and controlling the oil tap means you still get to name the tune. His second big move? Reinventing 'Pax Americana' as a gangster's peace — where alliances are transactional, enemies are 'rebranded,' and migration becomes a loaded weapon aimed at Europe's back door. Need leverage on Russia? Label a few Muslim groups 'terrorists' and watch Moscow sweat over its southern flank. Want to rattle China? Play puppeteer with Gulf oil flows and wedge a crowbar into OPEC+. It's energy blackmail meets Belt and Road sabotage. And then there's Israel — the wild card he once held close to his chest but now seems reluctant to play. Trump bypassed Tel Aviv to cut deals with Hamas, flirted with Iran via nuclear backchannels, and tossed a bone to the Houthis without checking if it barked in Hebrew. His silence on Israeli normalization during this Gulf safari wasn't an accident. It was a calculated shrug. A signal. Maybe even a threat. Could it be that in Trump's grand casino, Israel is no longer the house favourite? Maybe. Maybe not. But Netanyahu should probably keep a go-bag near the door. The desert mirage And what of those headline-grabbing deals? The US$1.4 trillion UAE pledge? That's almost three times their entire GDP. More smoke than fire, most likely — desperate PR from leaders trying to buy favour or stall for time. Still, perception is everything in Trumpworld. If the markets believe, then the spell works. If investors swoon, then reality doesn't matter. That's how Trump has always operated — from Manhattan to Mar-a-Lago: turn bluster into belief, and belief into billions. The scariest part? It might just work. So while European leaders shuffle papers on slow trains to nowhere, Trump is crafting new rules with iron-fisted 'reliable partners' like Erdogan and the Gulf sheikhs. Hoping that one day, Xi and Putin will RSVP to the poker game he's dealing. Strap in. It's getting turbulent. What's left behind is a Middle East cracking under pressure. An America grasping for reinvention. And a world order where ideologies are dead and all that matters is the deal. Trump's message is loud and clear: Play ball, or get steamrolled. And everyone — from Beijing to Brussels, from Tehran to Tel Aviv — just heard it. Fasten your seatbelts. Even the almighty Bibi might want to double-check his parachute. *This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.
