Delivering promises to strengthen investment ties between Germany and Africa, the Germany Africa Business Forum (GABF) has unveiled a “multi-million dollar” funding commitment to invest in German startups exposed to African energy projects.
The intra-regional initiative is made possible by combined efforts with private partners from the energy industry, and will be the first of its kind. According to the forum, the initial goal is to financially assist German companies and allocate funding for them by the end of the year.
Sebastian Wanger, GABF co-founder, said: “Through our partners, we will immediately get involved in investing in solutions-driven German startups with pragmatic business models to solve Africa’s energy challenges through the provision of German technology and innovation,” he added.
In the last few years, Germany’s commitment to Africa has been gaining momentum. In October 2018, German Chancellor Angela Merkel welcomed 11 African heads of state and government to the Chancellery in the Compact with Africa initiative. This was the largest meeting of its kind in the European country’s history.
At the G20 Africa Investment Conference, the German government also announced that it would launch a USD 1 Bn Development Investment Fund for German SMEs to thrive in Africa.
Speaking at the conference in Berlin, Merkel promised to make additional government funds available to German companies as insurance against political and commercial risks in their foreign endeavors.
Africa is home to around half of the 20 fastest-growing economies in the world. Nonetheless, there is only about 1,000 active business in the continent, that is, of the 3.5 million total companies. With the efforts as of late, that looks like it’s about to change.
Though the new fund’s volume is partially revealed, a hint was given about it’s actual size at the conclave in Germany last year. According to Stefan Liebing, Chairman of the German-African Business Association, investments of as much as USD 3 Bn are quite conceivable in 2019.
He said that with the new measures brought on by the Federal government, German SMEs would start doing business in Africa. However, this new scheme could comprise more millions than hinted last year.
“The future of Africa’s energy industry will depend on technology and innovation. When German start-ups and Africans work together, we can build something unique for both our peoples. I applaud the GABF for this well-thought-out initiative.
I believe it is in line with the goals of the G20 Compact with Africa, driven by Germany”, stated NJ Ayuk, a pan-African energy dealmaker, CEO of Centurion Law Group and Executive Chairman of the African Energy Chamber, a supporter of the initiative.
Anchored in the private sector, the GABF brings together Africa’s foremost executives with German companies, investors, and innovators with the aim of driving change. Founded in 2017 as a “private for privates,” the GABF encourages German investors to consider the African continent as a profitable and important investment destination.
Through a series of initiatives, the GABF draws together African business and political leaders with Germany’s preeminent innovators to develop fresh investment concepts that shape German and African business ties, as well as economic thought.