DP World and UK's development finance institution CDC Group (CDC).have joined forces to create an investment platform that will provide the foundation for major investment in African ports.
The platform covers a long-term investment period, with DP World contributing its stakes in three existing ports initially. It expects to invest a further $1 billion through the platform over the next several years. CDC is committing approximately $320 million initially and expects to invest up to a further $400 million over the next several years. The transaction is subject to certain final regulatory approvals.
The platform will invest in origin and destination ports, inland container depots, economic zones and other logistics across Africa to increase trade, create new job opportunities and broaden access to essential goods. It will initially be seeded with minority stakes in existing DP World assets, with significant capacity expansion plans, including Dakar (Senegal), Sokhna (Egypt) and Berbera (Somaliland), says Sultan Ahmed bin Sulayem, DPW group chairman and CEO.
CDC is owned by the UK Government and has the dual objective to deliver development impact by supporting business growth that lifts people out of poverty and makes a financial return.
"Stable and flourishing economies are built on reliable access to global and intra-continental trade. Africa's full potential is limited by inadequate ports and trade bottlenecks, putting the brakes on economic growth in some of the world's fastest-growing economies and undermining social resilience in the least-developed parts of the world,” says CDC CEO Nick O'Donohoe. “This platform will help entrepreneurs and businesses accelerate growth with access to reliable trade routes, and it will help African consumers benefit from the improved reliability and reduced cost of vital goods and food staples.”