This Africa Day, ADN celebrates the tremendous progress made by the African Union (AU) to launch the African Diaspora Investment Fund.
This historic announcement was made at the Diaspora Talks, hosted in Dubai in March 2022 by the Citizens and Diaspora Organizations Directorate (CIDO), which is responsible for the implementation of the African Union’s vision of a people-centered and -driven organization based on a partnership between governments, civil society, and diasporas.
I had the honor of representing the African Diaspora Network (ADN) at this AU conference. We were among a handful of diaspora organizations from the U.S., Canada, and Europe. The convening informed participants on AU’s journey with the five Diaspora Legacy Projects adopted by the Heads of Government of AU member states.
A decade in the making, the African Diaspora Investment Fund is among these legacy projects originally committed to during the Global African Diaspora Summit held in Sandton, South Africa, in May 2012, where I had the opportunity to participate. Ten years later, I was excited to be a part of the AU convening that shared that the 40th session of the African Union Executive Council had adopted a framework for the project, the African Diaspora Finance Corporation (ADFC). Fifty-five countries have approved the African Diaspora Investment Fund and need to ratify the project.
The African Diaspora Network congratulates the African Union on this significant milestone that sets up a much-needed finance platform that engages the diaspora. According to the African Union, the ADFC will be set up as an independent, non-AU continental finance institution. This will operate as a social enterprise and work together with African and global finance, development, and diaspora institutions. The next steps involve a feasibility study looking into business operations, investment planning criteria, and the application of ADFC funds.
Investment through Intentional Diaspora Engagement
Diasporans represent a powerful constituency in the economic development of Africa and the U.S. Over $48 billion in recorded remittances were sent to Sub-Saharan Africa in 2019 — a level comparable to the sum total of official development assistance in the same year. As part of the 76th United Nations General Assembly in September 2021, ADN partnered with the United Nations Economic Commission on Africa to host the side event, “Leveraging the Diaspora for the Benefit of Households and National Economics in the Countries of Origin and Destination.” The conversation explored the need for an intra-African voice for collaboration and the need to tap into the potential of financial inclusion with the Diaspora, from remittances to elevating diaspora investments that can change the developmental landscape of local communities.
African diasporans are a force for good, giving abundantly to the communities they live in and sending remittances back home to friends and family. Africans of the diaspora are by far the largest direct investors in Africa, and not just from abroad, but within the continent. There is a need to demystify that Diaspora remittances do not just come from Western countries. Seventy percent of migration happens within Africa, and a majority of immigrants from Africa are in Africa.
The AU’s African Diaspora Investment Fund is precisely the type of innovative finance mechanism that can harness the vast resources of the Diaspora. Connectivity and a viable technological infrastructure will be key to the success of the platform. Because remittances are not easily scalable, African governments must also create an ecosystem conducive for diasporans to invest. Engaging diasporas has been proven to strengthen the socioeconomic development of their home countries through capacity-building, skills transfer, and partnerships.
African Diaspora Network is uniquely positioned to mobilize the Diaspora. Since 2010, we have convened Africans, Diasporans, and friends of Africa to draw upon the voices, expertise, and backgrounds of seasoned leaders in sectors ranging from venture capital and philanthropy to technology and academia. ADN seeks to elevate the contributions of the Diaspora for the betterment of Africa and activate multilateral and private-public partnerships as potential opportunities for collaboration.
Investing in the Well-Being of Africans: Africa Day 2022
This Africa Day, we celebrate “The Year of Nutrition,” defined by the African Union as “Strengthening Resilience in Nutrition and Food Security on the Africa Continent: Strengthening Agro-Food Systems, Health, and Social Protection Systems for the Acceleration of Human, Social, and Economic Capital Development.”
There is a notable linkage between the well-being of Africans, Diaspora investment, and remittances. According to the 2017 United Nations’ World Population Prospects, Africa will be home to 2.2 billion people by 2050. This will require targeted new enterprise growth in areas that can enhance food supply, health care services, and educational solutions within local communities. For example, 60 percent of the world’s uncultivated, arable land is in Africa, yet many African countries import food at high costs (McKinsey 2019). How can we invest in the continent to tap into and cultivate our existing resources?
With Africa’s growing population and need for enterprise growth in areas that can enhance food supply, health care services, and educational solutions within local communities, the diaspora’s investment in enterprises would go a long way to enriching the continent.