African digital financing leaders demand systemic change

Africa’s digital transformation stalls not from lack of capital, but from shortage of bankable projects and weak institutional collaboration. African multilateral financial institutions, policymakers, development partners, and private sector leaders converged to address a critical paradox. Capital exists, yet innovation-driven sectors remain starved of affordable, long-term funding.

“Africa’s innovation challenge is not a shortage of ideas, but a shortage of long-term, affordable, and well-structured financing,” said Hanan Morsy, former Deputy Executive Secretary and Chief Economist at the United Nations Economic Commission for Africa. The gap between available capital and actual investment in technology sectors reveals deeper structural problems.

The Capital-to-Investment Disconnect

High costs of capital, limited risk-sharing mechanisms, currency risks, and insufficient early-stage financing continue to block investment. These obstacles target digital infrastructure and artificial intelligence projects specifically. Gaps in project preparation and scarcity of investment-ready opportunities compound these challenges.

Strengthening project preparation and improving pipeline development emerged as key priorities. These steps could unlock large-scale financing across the continent.

Regional Maritime Development Bank leadership stressed the need for innovation in financing itself. “In the technology space, risk is harder to structure. We need more creative financing models and dedicated funds to support early-stage innovation.”

Blended Finance and Institutional Reform

Participants called for adapted financing approaches using blended and risk-sharing structures. These combine guarantees, advisory services, and capital mobilisation to align with technology-driven sectors’ risk profiles. Expanded use of tailored instruments must support innovation across its full lifecycle.

The instruments include blended finance, co-financing mechanisms, and dedicated innovation funds. They support development from early-stage through to scale.

The session underscored that financing innovation requires parallel investment in enabling infrastructure and systems. Technology extends beyond digital tools to include infrastructure, energy, and emerging technologies.

Participants emphasised strengthening regulatory frameworks, digital infrastructure, and innovation ecosystems. These enable scalable, sustainable investment across African markets.

The session concluded with calls to reduce financing costs and expand risk-sharing mechanisms. Leaders also demanded stronger project pipelines, mobilised long-term capital at scale, and enhanced collaboration among African institutions.

For institutional investors and development finance professionals, the message is clear. Africa’s digital opportunity remains vast, but unlocking it requires moving beyond traditional financing toward coordinated, practical solutions.

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