Pan African fund to encourage development

OLD Mutual has commended the regional initiative of the newly formed Pan African Infrastructure Development Fund (PAIDF) saying it would assist and hasten the development process on the continent, and foster economic growth.

Old Mutual’s African Operations Managing Director, Johannes !Gawaxab was one of the many delegates who witnessed the launching of N$4,2 billion PAIDF over the past weekend in Accra, Ghana during the ninth African Union Summit. !Gawaxab lauded the idea saying this would also advance Namibia’s economic development.”The newly launched Pan African Infrastructure Development Fund provides an additional financing source for infrastructure development, promotes domestic capital formation and enlarges the investible universe in Namibia,” said !Gawaxab.Old Mutual Namibia has invested more than N$350 million towards PAIDF.Initial investors for the fund included Ghana’s Social Security and National Insurance Trust, South Africa’s Public Investment Corporation, The African Development Bank (AfDB), The Development Bank of South Africa and the Barclays Bank/ABSA Group.Old Mutual Group together with Metropolitan and Standard Bank Group – all from the southern Africa region – formed the rest of the investors for the fund, which is largely managed by personnel from South Africa.International financiers from the European Union and other western countries are expected to come on board over the next six months and top the capital.The fund has been hailed by many saying it would help create an investment platform for much needed basic infrastructure in Africa and accelerate growth for sustainable development.It is expected to bring about economic changes as adequate and properly functioning infrastructure contributes to the competitiveness of a country.The PAIDF intends to raise N$8,4 billion and which would be channelled specifically into infrastructural development in the transport, energy, water and sanitation, and telecommunications sectors across the continent.”Many African economies are too small to achieve economies of scale which means that transactional costs are high, there is significant lack of competitiveness and a high cost of capital prevails,” said !Gawaxab.According to press reports from Ghana, the PAIDF Chief Executive Officer, Tshepo Mahloepe, was this week quoted saying there are already 18 projects on the pipeline vying for funding.He also said there were strident investment procedures for the fund in place which required that not more than 25 per cent would be invested in a particular region, not more than 20 per cent would be invested in a particular country and not more than 30 per cent in a particular sector.!Gawaxab lauded the idea saying this would also advance Namibia’s economic development.”The newly launched Pan African Infrastructure Development Fund provides an additional financing source for infrastructure development, promotes domestic capital formation and enlarges the investible universe in Namibia,” said !Gawaxab.Old Mutual Namibia has invested more than N$350 million towards PAIDF.Initial investors for the fund included Ghana’s Social Security and National Insurance Trust, South Africa’s Public Investment Corporation, The African Development Bank (AfDB), The Development Bank of South Africa and the Barclays Bank/ABSA Group.Old Mutual Group together with Metropolitan and Standard Bank Group – all from the southern Africa region – formed the rest of the investors for the fund, which is largely managed by personnel from South Africa.International financiers from the European Union and other western countries are expected to come on board over the next six months and top the capital.The fund has been hailed by many saying it would help create an investment platform for much needed basic infrastructure in Africa and accelerate growth for sustainable development.It is expected to bring about economic changes as adequate and properly functioning infrastructure contributes to the competitiveness of a country.The PAIDF intends to raise N$8,4 billion and which would be channelled specifically into infrastructural development in the transport, energy, water and sanitation, and telecommunications sectors across the continent.”Many African economies are too small to achieve economies of scale which means that transactional costs are high, there is significant lack of competitiveness and a high cost of capital prevails,” said !Gawaxab.According to press reports from Ghana, the PAIDF Chief Executive Officer, Tshepo Mahloepe, was this week quoted saying there are already 18 projects on the pipeline vying for funding.He also said there were strident investment procedures for the fund in place which required that not more than 25 per cent would be invested in a particular region, not more than 20 per cent would be invested in a particular country and not more than 30 per cent in a particular sector.

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