Win For SMEs As African Stakeholders Rally For Financing To Drive Inclusive, Sustainable Development

• African business leaders agreed on supporting the private sector, especially the small and medium enterprises (SMEs) for sustainable development
• The key stakeholders made the declarations during the 59th Annual Meeting of the African Development Bank (AfDB)
• Equity Bank Group managing director and CEO James Mwangi emphasised on the need for SME training and financing

Nairobi, Kenya - Key African stakeholders have called for collective support of Africa’s private sector and small and medium enterprises (SMEs) to drive inclusive and sustainable development in the continent.

The deliberation was made during a panel discussion organized by the Alliance of African Multilateral Financial Institutions (AAMFI) at the 59th Annual Meeting of the African Development Bank (AfDB).

How key stakeholders can support Africa's SMEs

The panel discussion focused on supporting small and medium-sized enterprises (SMEs), which are the backbone of Africa’s economy.

Speaking during the event, Prof Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank and Chairperson of the Alliance of African Multilateral Financial Institutions(AAMFI) “The Africa Club,” underscored the importance of the Alliance's formation in helping Africa’s private sector.

“The key purpose of the formation of the AAMFI was to create a platform for all of our African multilateral financial institutions to work more closely to attain a common mandate.

"These banks already serve complementary roles in financing the continent’s development and the private sector. The formation of the Alliance underscores the collective commitment of its members to support Africa's self-reliance and private sector," said Prof Benedict Oramah.

What African countries should do to support SMEs

Equity Group Managing Director and CEO James Mwangi emphasised the training of SMEs and startups.

“We need to implement financial literacy programs and training for startups and entrepreneurs, as traditional global financing models that rely on data are not suitable for these new ventures.”

The panel discussion focused on the need for partnerships among stakeholders and governments for sustainable and feasible projects.

President and CEO of Africa Finance Corporation and 1st Vice Chairperson of the Alliance of African Multilateral Financial Institutions (AAMFI)” The Africa Club” Samaila Zubairu said partnerships will capture value on the continent.

“Partnerships that work are those that have the realization that we must unlock, retain and capture value on the continent by moving away from exporting raw materials to finished goods and processed goods” said Zubairu.

Zubairu further stressed the need for African countries to become self-reliant in goods processing, describing it as a foundation for building capital markets and developing quality human capital.

“By advancing from import substitution to primary industries, we create quality jobs and mobilize savings within the economy. These institutional savings can then support capital market development, allowing us to mitigate risks,” he added.

The President and Chief Executive of Trade and Development Bank Admassu Tedesse emphasised rethinking the architecture.

“We need to do business differently and work together through partnerships. We also raise money and are very successful, but there are a few things that make a difference, like partnerships,” said Tedesse.

The panellists also advocated for enhancing the quality of human capital and establishing research institutions to bolster capital market development.

Insure SMEs and private sector from political risk

African Trade and Investment Development Insurance CEO Manuel Moses highlighted the need for political risk insurance in Africa, especially given the continent's numerous elections that could lead to regulatory changes.

“There is a need to create political insurance for Africa, to try and make projects work on the continent," said Moses.

Zep-Re Managing Director and CEO Hope Muler reiterated the need to make insurance more inclusive.

“There is need to focus on the agro value chain, and the insurance sector is coming together to provide packages that derisk the SMEs, especially the trade and investments that they are making,” said Muler.

Shelter Afrique Development Bank managing director and CEO Thierno-Habib Hann emphasized the role of development banks in supporting the private sector.

“We must take chances with entrepreneurs by focusing on the character of the investor and their passion. To create unicorns in Africa, we need to invest in companies at their early stages,” Hann concluded.

This panel discussion showcased the unified call from African financial leaders for strategic support to drive the continent's economic growth through robust private sector development.

Government support to business

Meanwhile, the deliberations followed the Kenyan government's pledge to support the businesses and industries affected by the floods that have resulted in loss of life, destruction of property, and significant economic disruption.

Cabinet Secretary Rebecca Miano expressed the government's concern and assured Kenyans that her ministry will do everything possible to assist those impacted, especially SMEs.

Ministry of Trade opened Karibu Business Support Centres to facilitate the collection of information on the affected businesses and to provide necessary assistance.

Proofreading by Otukho Jackson, a multimedia journalist and copy editor at TUKO.co.ke