Africa Needs Viable Projects to Attract Chinese Investment

African countries must develop commercially viable projects, strengthen local partnerships and establish sound financing structures to attract more Chinese investment into infrastructure, manufacturing and other productive sectors, Chief Executive Officer of Rand Merchant Bank (RMB), Emrie Brown, has said.

Brown said growing interest by Chinese businesses in Africa was shifting beyond traditional trade towards establishing, owning and operating businesses on the continent, but translating the interest into actual investments would depend on the availability of bankable projects and strong local partnerships.

He spoke against the backdrop of growing China-Africa economic relations, with bilateral trade exceeding $350 billion, as both sides explore opportunities in infrastructure, critical minerals, renewable energy, transport, technology and manufacturing.

According to him, attracting Chinese capital would require more than identifying investment opportunities, as businesses also need commercially sustainable projects, appropriate financing structures and partners with knowledge of local markets.

“The relationship between China and Africa is shifting from trade-led engagement towards deeper, longer-term partnership. We increasingly see Chinese businesses looking beyond trade to build, own and operate in Africa, while interest is growing in processing, manufacturing and greater value creation on the continent. Realising that opportunity requires commercially viable projects, sound financing structures, local knowledge and partners who can deliver,” Brown said.

Chief Executive Officer of RMB Nigeria, Bayo Ajayi, said Nigeria’s market size and growth potential presented opportunities for deeper investment partnerships with Chinese businesses.

He said stronger connections with China could help link investment opportunities in Nigeria with the capital, expertise and relationships required to execute projects.

“There exist significant opportunities to translate growing Chinese interest into partnerships that support Nigeria’s infrastructure and industrial ambitions, strengthen local value chains and create sustainable economic value,” Ajayi said.

Against this backdrop, RMB has opened an advisory business in Beijing, China, to connect Chinese companies, investors and financial institutions with trade and investment opportunities across African markets.

The new business, Rand Merchant Advisory (Beijing) Co. Ltd., will provide advisory, financial structuring, cross-border execution and capital solutions to Chinese businesses seeking to invest in Africa.

It is also expected to help investors navigate regulatory requirements, currency and liquidity risks, cross-border payments and local operating environments across African countries.

Chief Executive Officer of FirstRand, Mary Vilakazi, said the partnership between China and Africa should translate into investments that create local jobs, develop skills and expand productive capacity.

She noted that while China brings capital, technology and manufacturing capabilities, Africa offers opportunities in infrastructure development, industrialisation, processing and manufacturing.

Vilakazi also identified South Africa’s capital markets and financial system as potential gateways for Chinese companies seeking to establish operations and partnerships across the region.