A growing demand for infrastructure investment across sub-Saharan Africa and the increasing sophistication of African investors is likely to bring Jersey's relevance to the continent sharply into focus in the coming years, delegates at a recent series of roadshows organised by Jersey Finance in South Africa have heard.
At the half day events, which took place in Johannesburg on 30 October and in Cape Town on 31 October and attracted around 200 finance and legal professionals, a range of Jersey and Africa-based speakers explored Jersey's well-established business ties with Africa and how the jurisdiction's evolution from a Europe-focused IFC to a manager of global capital was shaping its relationship with the continent.
In particular, speakers in two separate panel sessions at each event discussed how Jersey's response to complex international regulation and its ability to demonstrate political and economic stability were helping to position it strongly both as a partner for inbound foreign direct investment (FDI) into Africa and for supporting the global aspirations of the next generation of African investor.
Pointing to figures from Capital Economics that show Jersey facilitates almost twice as much inbound investment into sub-Saharan Africa (£25 billion) as it does outbound investment, Allan Wood, Business Development Director, Jersey Finance, who introduced the events, said:
"Jersey is already regarded as a jurisdiction of choice by African investors for its range of private wealth management services, and Jersey continues to work extensively with high net worth families to internationalise their wealth and provide robust succession planning solutions.
"However, Jersey's focus on innovation across its funds product range together with its increasingly global focus are helping to deepen its relationship with Africa and support investment into Africa too. Particularly in the infrastructure, property and private equity asset classes, Jersey now serves as a portal for attracting high quality capital from the US, Europe and Asia that is then put to work in Africa, helping to bridge the African investment gap and support the continent's growth aspirations."
An independent study commissioned by Jersey Finance in 2014, 'Jersey's Value to Africa', found that over the next 30 years Africa would need to invest US$85 trillion in infrastructure to support its growing population. With current levels of investment not sufficient to meet that requirement, it's estimated that US$6.1 trillion will need to come from outside the continent through FDI.
Meanwhile, with one of the panel sessions focusing on the changing global political landscape and the sustained roll-out of international regulatory initiatives, Geoff Cook, CEO of Jersey Finance, who also spoke at both events, added:
"With the IMF forecasting that economic growth in Africa could reach 3.5% this year, it's clear that the continent's potential is significant. A key message to emerge from our events this year was that, powered by this economic growth and digital innovation, African investors are taking an increasingly global and sophisticated view.
"They are ready and willing to explore new and more diverse investment opportunities around the world in areas such as philanthropy, impact investment and non-conventional asset classes, but they need specialist support to do that. Looking to the future, IFCs like Jersey can play a vital role by working with African investors to help ensure they are pursuing their objectives in the right way, helping them to navigate complex international regulatory and governance requirements and ensuring compliance with reporting criteria."
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