Unlocking Africa’s Trillions: Mobilizing Local Capital for the Lobito Corridor and Beyond

"In Africa, true progress comes when we build with capital we own, governed by rules we determine."

Africa faces a staggering annual infrastructure deficit of over $400 billion, yet up to $4 trillion sits idle in domestic coffers a disconnect that could define our continent’s next decade. In this edition, we unpack how mobilizing local capital and strategic partnerships, such as a new $320 million deal with Italy to fund the Lobito Corridor, can rewrite Africa’s infrastructure story and create fresh opportunities for builders, investors, and the diaspora alike.

Why the Time to Act Is Now

African governments once relied on donor grants and foreign direct investment to fund roads, rail, and energy. Those flows have dwindled amid global rate hikes, shrinking aid budgets, and rising protectionism. Meanwhile, pension funds, sovereign wealth funds, and commercial banks across Africa hold roughly $4 trillion that could underwrite critical projects. But legal restrictions and risk aversion keep most of these assets parked in short-term instruments. The result: a $400 billion annual gap that threatens to stall growth, worsen congestion, and derail regional integration.

Barking Up the Right Tree?

External vs. Internal Funding Relying on Chinese, European, or U.S. capital may plug immediate gaps but often leaves projects vulnerable to shifting geopolitical winds. Shifting toward local capital requires policy reforms, pension laws, regulatory frameworks, and tax incentives, to allow long-term investments in infrastructure. But entrenched interests in the finance sector worry about market destabilization if pension funds’ mandates change.

Geopolitical Stakes of Lobito In early June 2025, the Africa Finance Corporation (AFC) announced a $320 million financing agreement with Italy to bolster the Lobito Corridor. This U.S.-backed rail and road link will connect copper- and cobalt-rich zones in Zambia and the Democratic Republic of the Congo to Angola’s Atlantic port of Lobito. Proponents see it as a way to counter Chinese dominance of Africa’s mineral routes and secure better export terms. Critics warn that without strong local oversight, even this high-profile corridor could suffer cost overruns and delays familiar to other mega-projects.

Numbers That Matter

• $4 trillion in domestic capital held by African institutions (pension funds, sovereign wealth funds, banks) ready for infrastructure

• $400 billion annual infrastructure financing gap (14 percent of projected GDP by 2030)

• $320 million Italy-AFC deal to support the Lobito Corridor

• $1.1 trillion in long-term institutional capital (pensions, insurance, sovereign funds) plus $2.5 trillion in commercial banking assets

• $2 billion–$3 billion annual fundraising target for AFC’s infrastructure portfolio

These figures highlight both the scale of resources within reach and the scale of the challenge.

AFC’s Vision for Change

“Investing in the Lobito Corridor is more than building a railway: it’s unlocking jobs, boosting trade, and breaking dependency on a single partner,” says Samaila Zubairu, CEO of the AFC. “As we mobilize local capital, we must ensure transparency and strong governance, or we risk repeating past mistakes.”

His words underscore the need for builders and financiers to couple speed with scrutiny, ensuring every dollar serves communities and bolsters regional resilience.

What You Can Do This Week

1. For Entrepreneurs & Contractors • Identify bankable projects (roads, power lines, ports) that can attract long-term pension-fund or insurance investments. • Form syndicates to pool risk and present unified proposals to local pension boards.

2. For Diaspora Investors • Explore AFC infrastructure bonds and allocate a portion of your portfolio to African projects through DiasporaBuild’s escrow-protected channels. • Advocate with pension boards and sovereign wealth funds in your home country to revise investment mandates for long-term infrastructure.

3. For Policy Makers & Regulators • Review pension fund regulations to permit a higher percentage of allocations to infrastructure; consider risk-mitigation tools like partial guarantees. • Engage stakeholders, financial institutions, builders, civil society, to co-create transparent procurement and monitoring frameworks.

Think Long Game, Not Just Short Gain

In Africa, true progress comes when we build with capital we own, governed by rules we determine. Mobilizing $4 trillion requires patience, trust, and a willingness to reform. Builders who embrace transparency, learning from both successes and missteps, will shape projects that stand the test of time; projects that our communities can claim as their own.

Your Next Step: Join the Movement

African contractors, financiers, and diaspora families: the keys to our next infrastructure renaissance lie within us. Create your contractor profile on diasporabuild.com to join a vetted network of professionals driving projects that uplift our continent. Together, let us transform these $4 trillion into roads, railways, and power lines that bond our communities, fuel our economies, and secure our shared future.

#AfricanBuilders #Infrastructure #DiasporaBuild #AFC #LobitoCorridor #LocalCapital #Transparency #AfricaRising

Sources

1. “AFC says Africa has $4 trillion local capital available to fund infrastructure” _ Reuters, 5 June 2025

2. “Africa Finance Corp to sign $320 million deal with Italy to bolster Lobito funding” _Reuters, 5 June 2025

3. “Africa holds $4 trillion in domestic capital for infrastructure investment – AFC” – Business Insider Africa, 6 June 2025

4. “State of Africa’s Infrastructure Report 2025” – Africa Finance Corporation

5. “Africa can unlock $4 trillion to finance vital infrastructure, says leading investor” – Semafor, 5 June 2025

6. “AFC Advocates Use of $4 billion in Domestic Funds to Develop Infrastructure” – 360 Mozambique, 6 June 2025

7. “Africa Infrastructure Investments and Trade – AEF 2019 CEO Interview” – LinkedIn (AFC CEO interview)

8. “Lobito Corridor: New era in African infrastructure” – Zambia Daily Mail, 5 May 2025

9. “Africa’s $4-trillion capital could fund infrastructure, says AFC” – Business Day (South Africa), 5 June 2025

10. “AFC Champions Shift of $4 trillion in Domestic Savings into Africa’s Infrastructure Transformation” – AFC News & Insights, June 2025