Invest Africa, the trade and investment platform for African markets has launched a new programme of support for over 500 African MSMEs.
The Next Generation Africa Forum will take place virtually on 16th September using a digital platform to connect MSMEs across the Continent with practical support from leading banks, VCs, multi-national tech companies and incubators, including Google, KPMG, DHL, Aon, and 4G Capital.
MSMEs form the backbone of Africa’s economies and are the engine of the region’s job creation drive, accounting for 70 percent of employment. With a high proportion of informal enterprises, many of Africa’s MSMEs, which already faced significant challenges, have been hit hard by the Covid-19 pandemic. Addressing the structural difficulties that small businesses in Africa face will be essential to both the Continent’s short-term economic recovery and long-term development.
African MSMEs have historically faced numerous barriers to growth. Sitting at the riskier end of the spectrum, access to private financing for early-stage businesses is challenging. Small market sizes and low levels of regional integration preclude many private investment options. Meanwhile, commercial banks struggle to offer adapted loans where the collateral is limited and credit assessments are often unreliable, leaving smaller businesses faced with higher interest rates than their larger peers.
In sub-Saharan Africa, lending to MSMEs accounts for only between 5 and 20 percent of traditional banks’ portfolios compared to a range of 20 to 60 percent for OECD countries. Even where financing can be secured, to be successful it needs to be accompanied by technical support to combat the skills deficit faced by many MSMEs.
Through a series of free-to-access interactive workshops, pitches, and discussions, the Next Generation Africa Forum will aim to overcome such barriers, offering MSMEs the support they need to thrive in a challenging economic context. Applications are now open for MSMEs to secure their place at the Forum where sessions will focus on building pathways to formality, preparing businesses for investment, accelerating growth, and managing digital risks.
Taking place during Invest Africa’s flagship event, The Africa Debate, the Next Generation Africa aims to provide a strong platform to foster collaboration between financial services, investors, entrepreneurs, and policymakers. The Africa Debate regularly assembles Heads of State and Ministers from across the region as well as business leaders and international investors to discuss future avenues for sustainable growth across the Continent and encourage public-private cooperation towards development goals.
Karen Taylor, CEO of Invest Africa said, “We are excited to introduce a new programme exclusively aimed at leveraging financial and business support for MSMEs at The Africa Debate this year. Through our network of over 400 businesses and investors across the Continent, we have seen first-hand the challenges the pandemic has created but we have also been witness to the resilience and energy within Africa’s entrepreneurial ecosystem. The engagement we have received from our partners in the private sector and government is a testament to the importance of MSMEs to Africa’s future growth and Invest Africa remains committed to leveraging our market position to support a healthy business environment for MSMEs and investors alike.”