### A reflection on the decline of Private Equity in African infrastructure: towards a new vision
It is undeniable that the announcement of a decline of 39 % of investments in Private Equity in African infrastructure in 2024, to fall to USD 1.4 billion, arouses strong concerns. This figure, reported by the Global Private Capital Association (GPCA) and published by Fatshimetrie, signs the end of a period of seven years of uninterrupted growth. However, beyond the figures, it is essential to question the underlying reasons for this decline and to explore the future prospects that could see the light of day in a continent with a thousand and one promises.
### A storm in a glass of water?
The fall in the private equity industry in African infrastructure might seem alarming at first glance, but it can also be considered a moment of action to reposition the continent on the global chessboard. Although investments have decreased, Africa remains a land of opportunities, with a population in full expansion and a potential of 600 million additional consumers in the coming years. In reality, this decline could point out a saturation of an investment model which has not evolved to meet the complex and varied needs of the continent.
### Comparison with other regions
By examining investment trends in other emerging regions, it is rare to note periods of continuous growth without adjustments. For example, Southeast Asia has also experienced ups and downs, but countries that have been able to diversify their sources of funding-by integrating not only private capital but also public funding and public-private partnerships-have often managed to sail through economic storms.
Another patent example is that of Brazil, where investors had to face economic instabilities, but knew how to capitalize on attractive regulations and tax incentives to revitalize their infrastructure. These lessons could offer a frame of reference for Africa, which is at a critical crossroads.
### Local actors: an under-exploited asset
Another often neglected facet is that of local investors. African venture capital, through emerging companies and start-ups, can play a pivotal role in revitalizing infrastructure. African pension funds, often overlooked by international investors, have considerable liquidity and in -depth local understanding of needs and issues. By integrating these actors into the investment equation, Africa could draw from an unexploited potential to finance its infrastructure.
### Renewable energies: a light at the end of the tunnel
Although the infrastructure sector has experienced a general decline, it is crucial to note that renewable energies are erected as the most attractive segment, attracting USD 6.7 billion between 2015 and 2024. By research and innovation, Africa can extend this dynamism to other crucial sectors such as agriculture, drinking water and transport.
A partnership with innovative companies in green technologies could promote the creation of solutions adapted to African specificities, while responding to global concerns about climate change. It’s not just about investing in infrastructure, but building systems that can adapt to future challenges.
### Call for action: reinvent the narrative
The future of Private Equity in Africa is not only based on a return of investments, but on a transformation of discourse around infrastructure. Governments, banks and investors must be creative to develop models adapted to the reality of the continent. This includes tax incentives, a more stable regulatory framework and project financing programs that encourage collaboration between the public and private sector.
A collective call for innovation, transparency and sustainability can contribute to generating a new era of investments which, far from being limited to simple figures, could catalyze inclusive and sustainable economic development.
### Conclusion: an opportunity to seize
With increasing infrastructure needs estimated between 97 and 105 billion USD per year until 2030, the importance of private initiative is more than ever crucial. Africa should see this contraction not as an end, but as an opportunity to bounce back more strategic. By redefining the landscape of investments and emphasizing the mobilization of all stakeholders, the continent can certainly transform this period of decline into a dynamic of resilient ascent. It is time for Africa to take charge of its destiny and to cross a new course to a promising future.