pdf version.qxd - Africa Diaspora Investment Week

OVERVIEW OF WORKSHOPS -
AFRICA DIASPORA INVESTMENT
FORUM 2005
This year alone has seen an increase in pledges for grants and soft loans with a total value of about $34 billion to the
continent of Africa - a much needed Foreign Direct Investment (FDI). The workshops, aim to educate policy makers as
well as encourage the active participation of the Diaspora.
The method in use is mainly interactive with audience participation in an environment, where information and ideas are
shared by the participants, with an audience mix of different stakeholders and experts in the industry from the Diaspora
as well as Africa.
n Stock Market
The stock markets in Africa have surged upwards in recent years and have come into their own as an alternative
method of acquiring proprietary rights in the development of the private sector.
Strategies are being developed by these markets, to engage with, the Diaspora in order to increase market
capitalisation. With a collective potential market share of at least $200 billion and still growing, most are currently
experiencing the advantages of doing so, with an increase in the flow of funds.
W orkshop Purpose: This workshop will therefore be seeking to explore the existing recommendations from policy
makers as well as looking at alternative strategies such as engaging with the Diaspora. Long and short-term strategies
will also be developed as part of the brain storming sessions involving delegates as well as experts in the industry.
The outcomes will be used to assist decision-makers in their development of appropriate policies, which will aid
investments in African capital markets
n Venture Capital/Private Equity
One of Africa’s main barriers to trade and investment is a lack of infrastructure. This inevitably leads to high investment
costs, which makes the continent a less attractive destination for funds.
According to the Commission for Africa Report, Africa needs an additional US$20 billion a year investment in
infrastructure. Policy makers have long suggested that for there to be an increase in inward flows in there construction
and development of infrastructure there needs to be strong input from the private sector. Traditionally financing for such
projects has come from development loans granted by multilateral agencies such as the World Bank.
As a continent in transition especially in the development of sectors such as telecommunication, transportation
and technology, venture capital funding will offer an attractive rate of return. Risk capital inflows into Africa will act
as an alternative to bank loans and also bridge the gap between government spending and development assistance.
W orkshop purpose: This workshop will explore the perceptions of risks seen by venture capitalists, a major barrier
to investment; Is this risk a myth; Are there any success stories in Africa; How can Africa tap into a global fund in
excess of $1.8 trillion in order to finance development projects. There would also be discussions on the reasons for
the under development of venture capital as a type of finance in Africa. Some of the factors to be considered
are leadership qualities, economies of scale, evaluation of risk for monitoring purposes, and regulatory environment.
Africa Diaspora Investment Forum