NIGERIA PUSHES FOR CHEAPER CAPITAL TO FINANCE AFRICA’S DEVELOPMENT

The Federal Government has called for cheaper and easier access to long-term capital for African countries, saying high financing costs remain a major obstacle to development across the continent. The call was made as stakeholders examined ways to improve access to finance and mobilise investment for infrastructure, industrialisation and other development priorities in Africa. The government maintained that reducing the cost of capital would help African economies attract more investment and create the conditions needed for sustainable growth.

Nigeria’s position reflects growing concerns over the financing challenges facing African countries, particularly the high cost of borrowing compared with economies in other regions. Expensive credit can make it more difficult for governments and businesses to finance major projects, while high interest payments can reduce the resources available for infrastructure, manufacturing, technology and social development. Stakeholders have therefore continued to push for reforms that would make financing more accessible and better reflect the economic potential of African markets.

The discussion also highlighted the importance of strengthening African financial institutions and mobilising more capital from within the continent. African institutions have increasingly advocated for greater use of domestic savings, pension funds, sovereign wealth funds, insurance assets and other sources of local capital to finance development projects. The African Development Bank estimates that the continent faces an annual development financing gap of more than $400 billion, despite African financial institutions holding substantial pools of managed savings.

Experts have also stressed that access to affordable capital must be accompanied by stronger industrial capacity, regional trade and infrastructure development. The argument is that Africa will struggle to achieve greater economic independence if it continues to export mainly raw materials and import finished products at higher costs. Expanding manufacturing, processing minerals and agricultural products locally, while improving trade links through the African Continental Free Trade Area, could help African countries retain more value within their economies.

The Federal Government’s call comes amid wider efforts to reshape Africa’s financial architecture and attract long-term investment into productive sectors. Previous discussions involving Nigerian and African officials have focused on improving credit assessments, strengthening development finance institutions and reducing dependence on expensive external borrowing. The push for cheaper capital is therefore aimed not only at increasing the volume of financing available to Africa but also at creating financing conditions that can support industrialisation, infrastructure development, job creation and long-term economic growth.