140 SECTOR-BY-SECTOR OPPORTUNITIES
Dr Maxwell M Mkwezalamba Commissioner for Economic Affairs
The Department of Economic Affairs is mandated to initiate and promote policies and strategies geared towards enhancing the
coordination, harmonization and facilitation of continental collective initiatives in economic integration. The department also undertakes measures that support investment promotion, mobilization of development fi nancing and the building of continental fi nancial institutions. Africa features prominently among the world’s 10 fastest-growing
economies over the last decade, in addition to offering some of the world’s highest returns on investment – performance that is expected to be maintained in the coming years. As global investors explore promising new markets, Africa attracts much attention. However, effi cient and reliable banking and fi nancial services underpin expanding prospects in the real economy, New opportunities are in microfi nance, as only 20 percent of African
households use fi nancial services. In recognizing microfi nance’s importance, the African Union Commission commissioned a study in April 2007 to create a plan for developing the sector. This culminated in the AU heads of state and government adopting guidelines for developing microfi nance in Africa. The AU also created the African Central Bank, the African Monetary
Fund and the African Investment Bank to give member states the means to address their development challenges. The Investment Bank will pool capital necessary to enhance integration, the Central Bank is required to create a monetary union and the Monetary Fund will provide balance-of-payments support. Signifi cant progress has been made in setting up these institutions and, in the case of the Investment Bank, the member states’ ratifi cation is the only step remaining before work begins. The AU also aims to integrate domestic fi nancial markets and establish regional capital markets, including a pan-African stock exchange. Such initiatives will deepen links with more-developed fi nancial systems and integrate Africa into the global economy.
large for any single institution to address. Consequently, the AU has moved to provide policymakers across the continent with the next best thing: greater diversity of viable fi nancing options; and leveraging of expertise and experience in order to achieve a better pan-African result and a stronger voice for its members on the international playing fi eld.
The AU has put a clear stake in the ground regarding its commitment to the fi nance sector through the development of three new institutions: the African Investment Bank (AIB), the African Monetary Fund (AMF) and the African Central Bank (ACB).
The mandate of the AIB is to foster economic growth and accelerate economic integration. Key components of its responsibility will be supporting the development of the
INVEST IN AFRICA 2011
African fi nancial services sector, and also playing a signifi cant role in fi nancing and providing innovative solutions to address the funding gap for regional integration and infrastructure development. The bank is awaiting ratifi cation from AU member states
before commencing operations. Once launched, it will be tasked with: mobilizing resources from the capital markets both, within and outside Africa, for the fi nancing of investment projects on the continent; promoting the investment activities of both the public and private sectors that target the regional integration of member states; using its resources to implement investment projects that contribute to the strengthening of the private sector and the modernization of the rural sector; and providing technical assistances to its members.
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