AFC earmarks $700m for Africa’s natural resource transformation

Business News of Monday, 9 October 2017

Source: Xinhua

2017-10-09

Mining InvestorsAFC seeks to see a transformational approach to mining in Africa

The African Finance Corporation (AFC) has made available about 700 million U.S. dollars available for the development of the natural resources sector of the African continent, Begna Gebreyes, Vice-President, Investments at AFC, has told Xinhua.

As most of the infrastructure needed by resource extraction firms is also beneficial to the socio-economic development of African countries, AFC says it drives investments into the natural resource sector with a view to inspiring a holistic development of the continent.

Gebreyes was in Ghana to participate in the Ninth West and Central Africa (WACA) Mining Conference and Exhibitions.

He said here in an exclusive interview on Wednesday that although a majority of its investments had been in oil and gas, AFC over the last three years had shifted focus onto solid minerals to ensure that its networks enterprise and expertise became more beneficial to the continent.

“If we are looking at the overall Natural Resources Portfolio, I would say it is more than 600 million dollars or about 700 million dollars. But majority of that is in to oil and gas. One of the reasons we started shifting focus into doing solid minerals about three years ago is that we want to diversify some of our natural resources portfolio,” the vice- president disclosed.

The finance company, which started in Nigeria in 2007, with the Nigerian central bank holding 42 percent of the shares, also has interests in Ghana, Sierra Leone, Mali, Guinea, Eretria, Ethiopia, Democratic Republic of Congo, and South Africa, among others.

In adding investments into solid minerals portfolio to its business, AFC seeks to see a transformational approach to mining in Africa in the next two to three years.

“So right now, the value of that portfolio is approaching 100 million dollars and natural resources sector, with the additional investment that we plan on making within one year and three years, we want to see that doubled, if not tripled to 200 million dollars or 300 million dollars in total value,” Gebreyes hinted.

Most recently in Ghana, the nascent Pan-African institution has backed a group of capital power solution providers working with a publicly listed (listed in one of the North American Exchanges) gold company operating in Ghana, which put out a request proposal to provide them with capital power solutions.

AFC found this project exciting because, as the vice-president explained: “We thought this kind of solution will bring stability of power and lower the cost of operation for this mine and it can also be rolled out for other mining firms in Ghana and other African countries.”

Gebreyes explained that this was a well thought-out solution to concerns across the continent about how to improve the stability of performance in the mines.

On world market prices for metals, he stated: “What we see is a real stabilization in demand, and return to growth, return of confidence, willingness to invest and even exuberance, especially in some commodities, whether zinc, copper or to some extent in gold and precious metals, particularly with Kin Jon Un and Donald Trump scaring the world with their rhetoric.”

“So we are very bullish on current state of affairs,” Gebreyes maintained.

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