AfDB, UK seek private capital to close Africa’s $402bn funding gap

The African Development Bank (AfDB) Group and the United Kingdom government are stepping up efforts to mobilise more global private capital for Africa’s development, building on the successful conclusion of the 17th replenishment of the African Development Fund (ADF-17), which raised $11 billion for the continent’s most vulnerable countries.

The collaboration, driven by UK government institutions – the Foreign, Commonwealth and Development Office (FCDO), UK Export Finance and British International Investment (BII) – is positioned as a continuation of the ADF-17 process and a response to Africa’s estimated $402 billion annual development financing gap.

As part of this push, the AfDB and its UK partners last week hosted the inaugural Africa Private Capital Mobilisation Day at Lancaster House in London. The event brought together more than 150 senior decision-makers from private equity firms, sovereign wealth funds, pension funds, insurers, philanthropies, development finance institutions and export credit agencies, signalling a shift from dialogue to execution in mobilising private capital for Africa.

Alongside the public forum, the AfDB Group, led by its president, convened a closed-door roundtable with senior executives from about 30 leading institutional investors to explore the creation of an Africa-focused Private Sector Innovation Lab. The proposed platform would provide a space to co-create new financing instruments, partnership models and risk-sharing solutions tailored to African markets.

Outcomes from the meeting were captured in the London Communiqué, which sets out commitments by the AfDB Group and its partners to scale private capital mobilisation for the continent. Further work will focus on priority actions and implementation pathways aimed at translating ambition into deployable capital and effective risk-mitigation solutions.

Discussions during the programme addressed how to reshape perceptions of risk in Africa, design innovative financial platforms and mobilise capital in fragile and frontier markets. New analysis from the Global Emerging Markets Risk Database, presented by the Center for Global Development, showed that long-term lending to African borrowers has historically been significantly less risky than widely assumed.

Sector-focused sessions highlighted healthcare and aviation as strategic areas for strengthening Africa’s economic resilience and integration. Participants were introduced to two flagship initiatives: the Africa Medicines and Equipment Facility, developed with the Gates Foundation, and the Integrated Aviation Transformation Programme for Africa, backed by a dedicated blended-finance facility.

What they said

Speaking at the opening, AfDB president Sidi Ould Tah said the initiative aligns with his administration’s Four Cardinal Points vision. “We will build on recent engagements with development finance institutions, export credit agencies, pension funds, sovereign wealth funds, insurers, and philanthropic partners to advance concrete initiatives under our vision for a New African Financial Architecture,” he said.

UK Minister for Development Jenny Chapman said: “We are delighted that President Ould Tah decided to hold the first Private Capital Mobilisation Day here in London, recognising the critical role of the City of London in mobilising investment for Africa.” She added that the UK’s shift from donor to investor would support countries seeking economic growth and an eventual exit from aid dependence.