From 1999 onwards, Danish companies began investing more than ever in Asia, Africa, and Latin America. Their confidence that there’s money to be made in developing countries has manifested in their investments in African countries, and Egypt may just be getting the lion’s share of the cash.
Danish Ambassador to Cairo, Tomas Anker Christensen has said that Egypt has landed USD 2 Bn in investments from Denmark.
According to an Egypt Today report, the money which was invested over the last three years is an indication that the North African country is a significant partner to Denmark. Christensen says that his country supports the stability of Egypt, especially as its neighbors are in the middle of economic instability.
According to the Investment Fund for Developing Countries, Danish investments in Africa have risen to about USD 3 Mn. Before 1997, there were about five projects done by the North European country in the continent every year, and it went up to 11 in 1999.
The need for infrastructural developments in Africa is crucial, according to the World Bank. Many businesses are faced with challenges, particularly the lack of steady power supply for industrial processes.
In 2017, a group of Danish investors committed an initial USD 550 Mn from the USD 1 Bn target Africa fund to encourage infrastructural investments in the continent. This UN report revealed that Africa’s crawling infrastructure is shooting Africa’s economy in the foot.
Called the Africa Infrastructure Fund I, the initiative was set for a 10-year duration with an initial target of 10 to 15 investments. The fund, reportedly, was tailored to support sustainable economic growth in Africa whole, delivering substantial returns to its investors.
The Africa Infrastructure Fund I has a duration of 10 years with the initial target of 10 to 15 investments that focus on investments in infrastructure in Africa. This is to support sustainable economic growth in the African region while delivering an attractive return to its investors.
In May 2018, Minister for Development Cooperation, Ulla Tørnæs, gave the green light for a Danish co-financing worth more than USD 89 Mn for the construction of a 54-turbine, 100 MW wind farm in the Ethiopian capital of Addis Ababa. The project swallowed a total over USD 180 Mn, USD 89 Mn of which was shouldered by the Danida Business Finance.
Nonetheless, Denmark is faced by some challenges too. According to Christensen, most of the obstacles are represented in customs, taxes, and land ownership. However, he says Egypt – Africa’s top investment destination – is making “very clear progress” by listening to investors and seeking ways to improve the situation.