UBA launches white paper to unlock $4trn idle capital in Africa

…. Elumelu urges African government, private sector to fix electricity

Washington D.C || United Bank for Africa (UBA) on Thursday unveiled a white paper aimed at mobilising as much as $4 trillion in idle domestic capital across Africa, arguing that the continent’s development hinges on unlocking and properly deploying existing financial resources.

At the same event, Tony Elumelu, Chair of UBA Group, called on governments and the private sector to address chronic electricity deficits, a barrier he said is choking economic growth and innovation.

The document, titled “Banking on Africa’s Future: Unlocking Capital and Partnerships for Sustainable Growth,” was released on the sidelines of the 2025 IMF–World Bank Annual Meetings in Washington, D.C.

UBA says the paper presents strategies for realigning policy, activating institutional investors—including pension funds—and aligning capital flows to domestic development priorities. It argues that Africa is not short of capital, but that much of it is “fragmented” or locked in ways that prevent effective deployment.

Elumelu laid out the stakes in remarks after the white paper launch, saying: “We believe that the problem of Africa’s development is fundamentally a problem of capital. … There is an abundance of capital, but it is fragmented.” He added: “Having capital that cannot be accessed or used effectively is as good as not having it.”

The white paper draws on research by the African Finance Corporation and illustrates that assets resident in African financial systems—commercial bank holdings, pension funds, sovereign wealth reserves—could be channeled toward infrastructure, energy, digital inclusion, and other priority sectors.

Elumelu emphasised that “electricity is so critical to power data and AI revolution,” and in his view, failure to fix access and reliability amounts to a development straightjacket.

Over 50 percent of Africa’s population remains without reliable electricity, he said, noting that youth demand systems that deliver—not sympathy. “If this happens, Africa has a role to play. If this does not happen, we are doomed,” Elumelu warned.

The report also calls on reforming how capital markets, pensions, and domestic savings are governed. It points out that many pension funds are overly conservative, often invested in low-yield government treasuries rather than being deployed in higher-impact assets.

According to the paper, over 85 percent of the assets of poor citizens are held in instruments or accounts where growth is minimal—a “false sovereign basis,” Elumelu said, arguing that deploying even a small fraction of these resources toward productive investments could trigger a multiplier effect.

The white paper outlines practical mechanisms, including blended finance, public-private partnerships, domestic capital pooling, and regulatory reform that enables risk pricing and mobilizes domestic investors.

It highlights existing engines like the African Continental Free Trade Area (AfCFTA) and the Pan-African Payment and Settlement System (PAPSS) as foundational for scaling intra-African trade and lowering barriers to capital flows.

UBA, with operations in 20 African countries and strategic presence in global financial centers, positions itself as both participant and enabler in this shift.

Elumelu told reporters that the work begins after reports are written: “The next critical step is execution. … What we have done here today, is just less than 1%. What’s important is what happens after here.” He emphasised accountability and delivery as the true tests of progress. Institutional leadership, clear governance, transparency, and the ability to de-risk investments are non-negotiable, he said.

Another key findings in the white paper is that the size of Africa’s idle domestic capital—held in reserves, insurance, pensions, and bank assets—if mobilised, could reduce dependency on foreign aid and volatile external funding.

The paper quantifies part of this pool: approximately $2.5 trillion in commercial bank assets, $1.1 trillion in long‐term institutional capital, and hundreds of billions more in other forms of savings and reserves.

Although not all such capital is immediately deployable, the paper urges governments and private investors to craft policy and regulatory environments that enable much greater use of these funds.

Elumelu and UBA are pushing for public policy reforms—electricity included—but also improvements in digital infrastructure, tax policy, and investment protection as crucial enablers.

He noted that while mobile money and telecommunications have “leapfrogged” forward in many nations, growth in sectors dependent on reliable power and connectivity lags far behind.

In her speech, Doris Uzoka-Anite, Minister of state for finance, commended the bank’s leadership in mobilising domestic capital for Africa’s development. She praised UBA for “putting your money where your heart is” and aligning private-sector ambition with government reform.

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Uzoka-Anite said Nigeria’s economic reforms—removal of fuel subsidies, FX liberalisation, and efforts to stabilise macro fundamentals—are beginning to yield results. “We’ve witnessed at least four quarters of growth,” she noted, adding that the government remains committed to achieving 7% GDP growth through further reforms in finance, energy, and capital markets.

She acknowledged the tension between government borrowing and private-sector access to credit, calling it “a paradox” that must be addressed through better fiscal design.

Reaffirming the government’s role, she said, “We will continue to champion private partnerships and deepen access to capital to drive sustainable growth in Nigeria and across Africa.”