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Despite massive support from governments and widespread regulatory changes since the crisis struck, banks are deleveraging in the worst possible way impeding economic recovery. Capital levels are too low (particularly in Europe), business models are too risky, and the approach to regulation is biased against lending to the private sector. A lack of trust makes private sector equity investment and funding problematic, and losses and
This project aims to better understand how aid can leverage private investment in Africa’s infrastructure. Given the importance of investment in this sector, it analyses how aid can help African governments improve the enabling environment and mitigating the risks to investors.