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SOUTHERN AFRICA ROUND TABLE MEETING ON MAKING FINANCE WORK FOR AFRICA STRUCTURED FINANCE: OPPORTUNITIES AND INNOVATION PowerPoint Presentation
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SOUTHERN AFRICA ROUND TABLE MEETING ON MAKING FINANCE WORK FOR AFRICA STRUCTURED FINANCE: OPPORTUNITIES AND INNOVATION - PowerPoint PPT Presentation


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WORLD BANK DFID SIDA USAID BANK OF ZAMBIA. SOUTHERN AFRICA ROUND TABLE MEETING ON MAKING FINANCE WORK FOR AFRICA STRUCTURED FINANCE: OPPORTUNITIES AND INNOVATIONS INTRODUCTORY REMARKS BY: SIYANGA MALUMO FIELDSTONE AFRICA (PTY) LTD JOHANNESBURG

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slide1

WORLD BANK DFID SIDA USAID

BANK OF ZAMBIA

SOUTHERN AFRICA ROUND TABLE MEETING

ON

MAKING FINANCE WORK FOR AFRICA

STRUCTURED FINANCE:

OPPORTUNITIES AND INNOVATIONS

INTRODUCTORY REMARKS BY:

SIYANGA MALUMO

FIELDSTONE AFRICA (PTY) LTD

JOHANNESBURG

LIVINGSTONE, ZAMBIA 7TH MAY 2007

africa today
AFRICA TODAY

Old JSE Johannesburg

Poverty in Africa

Zimbabwean Woman

Market Scene

Road in Nigeria

africa today3
AFRICA TODAY

Rwandese Refugees

Upmarket Apartments

Subsistence Farming

Learning Under a Tree

Prosperous Farmer

slide4
AFRICA TODAY
  • Geography
      • 30 million Sq. km
      • 53 Countries, including the Islands
  • Demographics (2002)
      • 800 Million People
  • The Economy (2002)
      • Gross Domestic Product: US$ 560 Billion
      • Average Per Capita Income: US$ 720
      • Total Debt: US$ 300 Billion
slide5

CONSTRAINTS TO AFRICAN DEVELOPMENT

  • Low Incomes, Low Savings, Low Capital Formation
  • Low Levels of Investment
  • Underdeveloped Formal Economy
  • Underdeveloped Middle Class (Key to Accelerated Development)
  • High Cost of Funds
  • Irresponsible Management of Public Funds
  • High Risk Perception
  • Shallow and Narrow Financial Markets
  • Lack of Individual Ambition & Individual Initiative (Looking to Government for Everything)
constraints to african development
CONSTRAINTS TO AFRICAN DEVELOPMENT
  • Culture of Financial Irresponsibility (Borrowing with No Intention to Repay)
  • Culture of Extravagance and Conspicuous Consumption (A Mercedes is Preferred to Investment)
  • Lack of Political Stability
  • Policy Fluidity
  • Unreliable Legal Systems
  • Bountiful Nature (Good Climate, Benevolent Forests & Rivers)
  • Perpetual Despair (Leaving it all to God)
  • Proclivity for Reliance on “Khaki Envelopes” (Chai, Dash, Baksheesh, Cold Drink)
  • Too Many Talking Shops
slide7

Pan African Approach to Development (Make NEPAD Work!)

  • Develop Effective Financial Intermediation (Banks to Reduce “Locking” Funds in T-Bills at Expense of Lending)
  • Promote Coordinated Approach in the Financial Sector (Banks, Insurance, Pension Funds, Mortgage Institutions to Synchronise)
  • Accelerate Africanisation of the Financial Sector (to Facilitate Better Appreciation & Management of African Risk)
  • Promote Creation of Continent-Wide Investment & Credit Guarantee Institutions (to Complement Afrexim Bank, to Promote Project Funding & Investments)
  • Increase Intervention of Bilateral & Multilateral Development Finance Institutions in Funding Private Sector in Africa

REMEDIES

advantages of structured finance
ADVANTAGES OF STRUCTURED FINANCE
  • Creative Management of Financial Risk
  • Innovative Technique (That Makes the “Impossible Possible”)
  • Facilitates Transactions (Especially Project Finance and M & A)
  • Facilitates Economic Development
  • Facilitates Indigenous Empowerment
  • Creates Wealth