The G20 Africa Partnership is a central project of Germany’s G20 presidency. Its aim is to improve conditions for sustainable private sector investment, investment in infrastructure, economic participation, and employment in African countries.
A key pillar of the G20 Africa Partnership is the Compact with Africa, an initiative within the G20’s finance track. It is coordinated by the German Federal Ministry of Finance.
Resolution on the Compact with Africa adopted by G20 finance ministers and central bank governors in Baden-Baden
The G20 acknowledges its special responsibility to join forces in tackling the challenges facing the poorest countries, especially in Africa. The Compact with Africa initiative aims to boost private investment and investment in infrastructure in Africa. Such investment is an essential precondition for strong, balanced and sustainable growth. However, spurring higher investment levels – particularly from foreign investors – requires improved conditions for investment.
To this end, the World Bank, the International Monetary Fund and the African Development Bank have produced a joint report (“The G20 Compact with Africa: A Joint AfDB, IMF, and WBG Report”) that was warmly received by the G20 finance ministers and central bank governors at their recent meeting in Baden-Baden. This report proposes a catalogue of instruments and measures designed to improve macroeconomic, business and financing frameworks as a way to boost investment.
Investment compacts with interested African countries
To improve these frameworks in a tailor-made way, individualised investment compacts will be set up between interested African countries, international organisations and partner countries. The various partners will commit to specific steps outlined in a catalogue of measures. The G20 will provide political support for comprehensive, country-specific packages of measures and will give African countries a platform to showcase opportunities and conditions for investment.
So far, the initiative has sparked great interest among many African countries. Côte d’Ivoire, Morocco, Rwanda, Senegal and Tunisia expressed particularly strong interest in letters to Finance Minister Wolfgang Schäuble, and their governments were invited in turn to send delegations to the G20 meeting in Baden-Baden. There they submitted clear declarations of intent that will be used as a basis for setting up investment compacts in the coming months.
These five countries, the C-5, will constitute the first group of compact countries. The Compact with Africa is a long-term project and is open to all African countries that are interested in improving their frameworks for private investment on a durable, sustainable basis.
The next key steps – in particular, the inclusion of bilateral partners and private investors – will be prepared at the Meeting of G20 Finance Ministers and Central Bank Governors on Washington, D.C. on 20‑21 April 2017 and on the sidelines of the World Economic Forum on Africa in Durban, South Africa, on 3‑5 May 2017. In addition, an international conference on the “G20 Africa Partnership – Investing in a Common Future” will be held in Berlin on 12‑13 June 2017. The conference will provide backing for the G20 Africa Partnership and the Compact with Africa and will present Africa in all its modernity and variety to policy-makers and private investors.
Source: Federal Ministry of Finance