The Capital Shift: Building Africa’s Industrial Future on African Terms

By Paul Abiagam

At this year’s Africa CEO Forum in Abidjan, one message echoed with clarity across every panel and corridor: Africa must stop exporting potential and start exporting prosperity. Not someday. Now.

As global supply chains shift and capital searches for new, resilient destinations, Africa stands before a rare window of opportunity, not as a passive source of raw materials but as a deliberate engine of value creation. Seizing this moment demands more than goodwill. It requires bold policy choices, available strategic capital, Africa-aligned partnerships, and a relentless homegrown ambition.

During the Cost panel session titled “The of Capital Crisis: How Can African Businesses Turn Geopolitical Shifts to Their Advantage?”, I joined industry leaders to explore a question central to Africa’s future: with the world changing geopolitically, economically and technologically, can African corporates unlock new pools of competitive capital and ascend the value chain?

The answer lies in a new financial realism, one anchored in value addition, the creation of strategic industrial hubs, the pursuit of aligned partnerships, the deepening of capital markets, and the unlocking of patient capital.

Consider the cocoa sector. Côte d’Ivoire and Ghana, long known for exporting raw cocoa, are now advancing policies to incentivize local processing and manufacturing. Their objective is clear: transition from commodity exporters to value creators. These governments are compelling corporates to move further down the value chain to increase export revenues, create jobs, and stabilize forex reserves. This is not theory, it is economics. Processing cocoa at source retains more value and catalyzes inclusive markets with significantly higher earnings potential.

Benin offers another example. Once primarily an exporter of raw cashew nuts to Vietnam, it is now taking decisive steps to process cashews locally. In Ethiopia, an ambitious industrial policy is positioning the country as a regional manufacturing hub. These are not isolated cases. They are signals of what is possible when policy, capital, and corporate resolve align.

Yet, despite these strides, African countries continue to pay disproportionately high premiums to access capital. The cost of capital remains a stubborn barrier to industrialization.

As I stated during the panel, “Africa is suffering, really, for a lot of the problems we have. We pay a significant premium compared to developed markets. That is driven by perceived high-risk potential, macroeconomic volatility, inflation, and currency fluctuations. These all add up. And yes, it is unfair.”

What makes this reality starker is that other regions, facing similar challenges, are not burdened by the same capital penalties. In Latin America, Argentina has long battled inflation, defaults, and political instability, yet its corporates often face lower risk premiums. Brazil, despite episodes of political upheaval and economic uncertainty, remains a preferred emerging market destination. In Southeast Asia, the Philippines experiences comparable macroeconomic volatility, but benefits from investor comfort rooted in historic trade relationships and integration into global supply chains.

Even within Africa, disparities persist. Côte d’Ivoire, Ghana, Benin, and Ethiopia are all pursuing similar value addition strategies, yet the cost of borrowing varies widely depending on investor perception rather than objective fundamentals. The inconsistency exposes a deeper problem: the risk premium attached to African markets is often shaped more by narrative than data.

This is where reform must meet realism. African governments must double down on de-risking mechanisms, enhance regulatory predictability, and build long-term confidence with investors. But equally, lenders must evolve. The traditional approach to African risk must give way to a more nuanced understanding. Institutions that truly grasp African dynamics and are prepared to innovate around them will define the next chapter of capital allocation.

This is where Coronation Merchant Bank is playing a catalytic role. Over the past year, Coronation has deepened its position as a trusted partner to Nigeria’s leading corporates, leveraging its capital markets expertise to structure strategic financial solutions. As lead or joint issuing house, the Bank has supported rights issues, public offerings, commercial paper issuances, and bonds across key sectors. These are more than transactions; they are trust-building mechanisms.

Through these initiatives, Coronation has facilitated access to long-term capital in an environment often constrained by elevated borrowing costs and investor hesitation. Each successful issuance strengthens the market, drives growth, and affirms the investability of African enterprise. Most importantly, it underscores a simple truth: African financial institutions must lead in unlocking domestic capital for domestic transformation.

Policy will remain a critical lever. Trade liberalization, while often seen as a driver of growth, has not always supported industrial ambition. As discussed during the forum, Bloomberg’s Ramah Nyang noted the backlash East African countries faced under AGOA when they moved to restrict second-hand clothing imports. Similarly, Indonesia’s push for localized nickel processing triggered international legal challenges. The lesson is clear: industrial policy must be paired with diplomatic foresight and global coalition-building.

However, the most vital shift must be internal. African corporates must evolve from being participants in the global economy to becoming its architects. This means shaping what gets financed, who finances it, and how value is retained on the continent.

“New lenders will emerge,” I noted. “China, India, Gulf states, we’ve talked about these players for years. But the real shift comes when African corporates define the terms of engagement.”

Confidence, backed by competence, is our greatest leverage. We must create institutions attuned to African risk and convinced of African returns. We must design capital instruments that enable opportunity, not restrict it. And we must broaden our definition of partnership, embracing equity, blended finance, and local savings mobilization alongside traditional lending.

Africa is not destined to remain a frontier market. It can and must become a factory floor, a processing powerhouse, a digital engine. This is not aspirational rhetoric. It is an achievable reality.

Ultimately, we must believe in what we build. If Africa captures even a fraction of the value it currently creates, sustainable wealth will not be a dream; it will be the outcome.

And this is what Coronation stands for: patient capital, strategic partnership, and a vision of prosperity grounded in African potential. We are not just financiers. We are builders. And in this era, Africa’s most powerful export must be confidence in our people, our policies, and our path forward.

Paul Abiagam is CEO of Coronation Merchant Bank