Bloomberg Audio Studios, podcasts, radio news, Government and business leaders from around the world met in Qatar this week, and African economies wanted to make sure they were on the agenda.
Africa CAPITALIZI enabling the private settor to drive okay straight and lead the growth and transformation and the content. I believe that these are sense we need to do to take Africa to the next steps.
With world trade rebalancing. After the inauguration of President Trump in the US, African leaders are looking to the Middle East for a new source of investment.
African institutions I building capacity, but we need to also pattern. I will wrestle the war to have robust payment capacity to transactions as well as facilitate trade.
On today's podcast, we're bringing you the best of the Qatar Economic Forum in Doha. From long term investments to emerging markets. Is the hope for Africa's continuing growth coming from the Middle East. I'm Jennifer's Abasaja and this is the Next Africa podcast, bringing you one story each week from the continent driving the future of global growth with
the context only Bloomberg can provide. On today's special episode, we're bringing you some of the key moments from the Qatar Economic Forum, where I was speaking to a number of Africa's foremost voices from the world of business, economics and politics. We start in Nigeria, where volatility in the oil market has meant lower earnings for Africa's biggest oil producer.
I spoke to aminu Umar Sadik, the Managing director of Nigeria's Sovereign Investment Authority, to find out where he sees future investment coming from.
As the old prize goes off and down, that actually affects the amounts of influence that coming to nsiety that actually give us the recourse to invest.
Then what does that mean for the outlook moving forward for NSII? Do you focus on other assets potentially? Do you look to goal? Do you look to Yeah, where else are you focusing?
Then?
So on the future generations fun side. At the end of last year, actually clearly valuation levels were high and so we pivoted to cash and that allowed us to do a couple of things at the beginning of this year. The first thing was we decided to pivot away from alternatives into defensive assets, particularly growth assets as well as assets investment. Great corporate bombs, the second thing that we did was actually for our long only portfolio, a long
only developed market's portfolio. We also decided to pivot away from the US to Japan, to Australia and to Europe. And then finally, what we decided to do was to rationalize our assets allocation to see how we could consolidate the number of names that we had into fewer, higher quality stocks.
Did they pivot away from the US happened prior to this new administration coming in. What was the thinking behind that?
Just the diversification play. It was important given where we saw the markets, how buoyant the market was, that we began to look elsewhere just to ensure that we had more robots portfolio. We had no political considerations, so to speak. And then on the infrastructure side, I think we're looking at a number of large scale transactions. I think the first thing that we're doing was around healthcare, particularly around oncology.
You may have heard the NSIA co founded a company called METSUV that focuses on oncology, on diagnostics, and on cat labs, and we are expanding that significantly. The second thing that we're doing is off the back of Mission three hundred, the proposition that both the World Bank and the AfDB co founded the NSIA Africa fifty Sustainable Energy for All are also put in together five hundred million dollar distributory renewable energy platform.
You were just talking about how a number of African sovereign World fund are going to be coming together in just a few weeks in a Bouja. You were mentioning is there a focus then on potentially local debt markets as opposed to looking international. Do you think African sovereign wealth funds are positioned to find that capital on the continent, And that's.
An excellent question. I think when you look at the size of local pension funds relative to our infrastructure deficits, that is the kind of capital that we need to be looking to mobilize towards infrastructure financing. And I think we can do more as multilaterals within the continent, as sovereign wealth funds within the continent, to begin to find ways to actually enhance blankable propositions and find ways to give comfort to conservative capital, particularly the pension funds, to
actually finance our infrastructure projects. On the sixteenth, alongside other African sovereign wealth funds, we will be hosting the African Sovereign Investment Forum in Abuja, and that will be the main theme of discussions at that point.
What's your target then for the end of day out of the year in terms of financing and MOBILIZINGCAPAGA.
We're looking at a minimum of one point five to two billion dollars as a start, and we are hopeful that a combination of our fifteen of US will get there.
But Africa is not only looking to export oil, it also wants to market the skills and talent of young Africans to the rest of the world. Here's Hendrik Detoit, founder and CEO of Asset Manager ninety one, on the role AI is playing on growing emerging markets in Africa.
I'm very excited about the solution of real world problems, i e. Getting research time which wouldn't have been justified in labs on the West coast or East coast of the US because it was deemed the problem was deemed too small or the economic outcome wasn't good enough. So real farmers enabling weak states to operate really well. I mean you could digitize and technology in a able the weakish developed developing country states into something really special. Without
turning them into the surveillance state. I think the downside is and I think where I'm quite bullish about Africa in particular in emerging markets, because Africans aren't spoilt. So all these reasonably unproductive, very expensive white collar jobs in the West, we are going to lose lots and lots of them. And everyone can't become a yoga instructor, right. Africans are kind of not in that food chain and therefore will adjust in a way which is faster and better.
But I worry about the general migration from manufacturing jobs and you know, to which may be supplanted by robots in the developed world, to the services jobs that would have been exported to the developing world, the sort of India bungal Or story that may not happen again. Look at the think about how many software developed is Microsoft fired? But think of the people behind those software developers. For if one of them, there's probably ten of them in India.
You know other places which do it. And I don't know the answer. So there's an up and a downside. I think Africa, because it's used to being tough and Africans are very flexible, can probably deal with it better than any other part of the world and.
Stick with us. When we come back, we'll hear from some of the African Startups to Watch in twenty twenty five and take a look to the future at how a changing climate could mean changing investments. Will be right back. Welcome back today. We are coming to you from the Qatar Economic Forum in Doha, where business and political leaders from Africa have come to make the case for investment.
African startups were here in Doha to find support from global investors, and we're showcasing some of the best of the continent with Bloomberg's inaugural twenty five African Startups to Watch lists.
In it.
I spoke to Awusu Akoto, the founder of Ghanaian logistics company Freezelink, and also Chilufia Mutale, founder of the Zambia and fintech firm Ishanti. I started by asking them about the opportunities and challenges for startups on the continent and also difficulties with some of the gaps in funding.
We have a lot of foreign influence in our ecosystems. Even the private act companies, the local private act companies generally you see that they're DeFi fund is so development finance institution funded. So with the USA drawing back with I think probably some inertia when it comes to the development finance cooperation in the US, even the Brits are drawing back. It's definitely had some ripple effects in terms
of funding. But at the same time, our pension funds sit on so much capital and so what we're seeing in Ghana is more momentum from the pension funds, more focused on alternative assets, which are the ripple effect on deploying capital that ends up in some of our local startups.
Has that been your experience, Luthia.
Yes, Well, it's well known that less than two percent of funding goes to women led businesses. It Shandy is a women lead enterprise and globally less than two percent of funding ghost women led startups. So you can imagine just in Africa alone what percentage is that. And funding
has been a challenge for us. We raised back in twenty twenty and over four years we're still trying to raise another funding round and it's a bit of a challenge and that's why we have to innovate, build a lot of resilience, stay lean, embrace technology, so that we can then evolve around other strategies to basically scale our businesses.
And that's the ranking of number four on Africa's Fastest Growing Companies really is a testament to our resilience that we've built admiss the challenges that we have around funding.
How do you scale you're talking about scale within other markets, within communities. How do you do that without that access to funding? What are some of the innovative ways you maybe finding that you can get there.
So we have strategic partnerships that we struck with mobile network operators that have customer base of over ten fifteen twenty million customers. Through these strategic partnerships, we are able to leverage off the customer base. They have their access to marketing and their direct access to cost of acquisition, so it's much lower because they already have that existing base. It costs much less for us to reach out to
these customers through these partnerships. So revenue sharing models the new way to go through collaborations without raising any funds, collaborating with banks who are not able to reach the underserved, where we provide the technology, we reach out to the customers and the banks then provide the funding and you have revenue sharing models and.
You're seeing the willingness by some of these institutions.
Yeah, yes, they are willing. They may not have the technology and the capabilities to serve the underserved, but they have the capital. And then we have the tech, we have the market access, we have the strategic partners, and then we also have peer to lending platforms that really help us work with the communities who believe in our mission, who then provide the investments as low as even one dollar, and then that then is then on lend to borrow
us on the platform. So are connecting investors to borrow us on the platform, and we've raised over six million dollars just through peer to peer lending and issued over eleven million dollars in loans for over the last three years.
How do you.
Balance a koto the need for some of the solutions that you both are speaking to on the ground. You know locally what the need is there, but also you talk about the investors and the others how you have to appeal to. How do you balance that?
So africase not selicond Valley, and I think that oftentimes our startups do have a spray and prayer proach when it comes to funding. We've been guilty of that in the past, but what we found is that it's better to try and find those parts of patient capital who really understand the context. And so we are working, for example,
with an asset for NTS company. They already have an asset finance fund in East Africa and we're looking to work with them to deploy modular code storage for our farmers so that they can pay on a page you go basis. So really is the balance of identifying what they need is and connecting with those who really understand the local context.
And finally, let's take a look to the future. With the impacts of climate change becoming clearer on economies across the world and especially in Africa, sustainability is going to become a key part of investment decision making in the years to come. I spoke to Martha Osier from the Africa focused investment firm ADNIAM about what this means for Africa's economies and what opportunities it could create.
In Kenya, we have established today what is the largest second largest retailer. When we invested, they had nine stores. Today we have sixty one stores, and we have partnered with another green mobility company called Rome Electric and one they do delivery. But I think more important for the startup is we provide them infrastructure where they can build their charging stations. So in terms of financing, it's not necessarily that or you have to do another capital race.
Can you find people in the ecosystem who you can leverage and you reduce your capex costs because I'm sure to set up or to go to I don't know how many landlords or you know, property owners and say I want to establish charging stations. Yet if you have a supermarket with sixty one physical brick and mortar locations, that's an easy way for you to plug into the system.
So we're not directly funding startups, but I think for startups that have applications to our existing businesses, that's an indirect way of financing and supporting them to grow.
Martha, what is going to be key for momentum in innovation to continue to build over the next few years.
I think it's has been said by all the panelists. It's solving real problems. Yeah, if I just relate to what Ayula was talking about. In our supermarket, at least fifteen percent of our products are fresh that we are sourcing from twenty thousand farmers. Yeah, if we could provide
them a way to store those products. What happens in Kenya is the fresh products are transported overnight because it's cooler, and we know, at least in Kenya over fifty percent of farm losses are happening because of a lack of that cold chain. Okay, So partnering with the supermarket providing coolboxes to these farmers one, I think solves your financing challenge. But two, you're solving a real problem for a customer who ultimately could either be you know, your exit plan
or your exit plan to to other supermarkets. So I think what is key for startups is make sure you're solving a real problem for people who are in your ecosystem. Don't only look at private equity, but also look at corporates, especially corporates that have been sponsored by private equity, as potential ways for you to grow your business and ensure your sustainability.
Of course, many economies are looking for new investment opportunities, like those at the Katar Economic Forum. After the US under President Trump, signaled it would be stepping back its role in the global economy, with South Africa one of the economies hit quite hard by the US pulling back from aid spending and imposing tariffs. President Zero Ramaposa has
been in Washington for talks with President Trump. The South African president found himself though ambushed by President Trump in the overall, if there.
Was Afrikana farmer genocide, I can bet you these three gentlemen would not be here.
Each one of those white things you see is across and.
There's approximately a thousand of them.
They're all white farmers, the family of white farmers.
So there is criminality in our country. People who do get killed, unfortunately through criminal activity are not only white people. Majority of them are black people. And we are now the farmers are the farmers are not black.
And I'm saying that's good or bad, but the farmers.
Are not black. Next week we'll bring you the full analysis of the fallout of those talks and what the future looks like for US South African relations. And you can see all of our coverage from the Qatar Economic Forum on Bloomberg platforms now, including the Next African Newsletter. Will put a link to that in the show notes. This program was produced by Adrian Bradley and tiwa Adebayo don't forget to follow and review the show wherever you usually get your podcasts.