Africa Faces a $700 Billion Investment Gap as Opportunities Grow

Johny Fernandez: Africa's top business leaders are making their case to Wall Street.

The Bullish Africa 2026 Summit brought more than 350 global investors together with African executives, right alongside the 81st UN General Assembly.

But the big question now is, where should the capital flow next on the continent?

So one of the voices leading that conversation is John Gachora, Group Managing Director and CEO of NCBA Group.

John, welcome.

John Gachora: Thank you, Johny.

Johny Fernandez: So John, you've had an amazing week this week. You were just on stage at Bullish Africa here in New York.

So what was the one message you wanted global investors in that room to take home?

John Gachora: That we have wonderfully investable opportunities in Africa.

I went through some numbers, and I said, if you look at 2025, we had about $200 billion of investments into Africa.

Now, of that, we say $70 billion was through what we call foreign direct investment. There's about $100 billion of what we call diaspora remittances that came into Africa. Part of it went into investments. Part of it was consumables, of course.

And then we had about $10 billion that was mostly venture capital.

What was interesting, though, were two things.

One is the unmet demand was $700 billion. So although we got $200 billion, the unmet demand was $700 billion. That was one.

Number two is that if you look at the investments that were made, close to 50% were by African investors, which means we are starting to believe in our own continent.

And what I said is, if you see somebody starting to believe in their own continent, you see a cook who is eating their own food. It means that food is very good, and that means that there's big things happening.

Johny Fernandez: So John, I want to ask you something because you've worked on both sides. You've worked here on Wall Street, you've worked at global banks like Bank of America, and now you're running an African banking group.

So in your opinion, what do Wall Street investors get wrong about Africa?

John Gachora: I think it's a very good question because one thing they get wrong is how you price risk.

Obviously, in the U.S., you have lots of data, right? In developed markets, not just the U.S., you have lots of data available.

Africa does not have as much data, and because of that, then we have what I call a negative view of risk.

So I've spent a bit of time here talking to investors about my own bank, which is listed on the Nairobi Securities Exchange.

And I could see the skepticism of, is it a real bank?

Now, if you look at return on equity metrics, for example, you look at growth year after year and what we're able to record, you look at our regulations, you look at, you know, if you just look at the accounting principles that we follow, you would actually realize that you could measure NCBA next to a JPMorgan in terms of stability.

But they don't view it that way.

They are afraid of, obviously, a number of risks in the region, which I can understand, but I think it's overstated, in my view.

Johny Fernandez: So the summit focused on capital and governance.

So what do you think investors need to see from African governments and companies before they'll commit more money?

John Gachora: Well, I think there is a bigger role for government to play.

One is them believing in their own markets, which I think countries like Kenya are now doing.

The government is starting to list its own entities on the securities exchange. They have also created funds to invest in the securities exchange, which then tells you that the government is starting to believe in those investable opportunities.

Number two is, obviously, that governance works.

So that was the big conversation. Does governance work?

So time and time again, we see that the judicial systems are working, that cases can go against the government, and the government has to pay if they go against them.

Time and time again, they're entertaining foreign investors into the country.

And the other item that we talked about quite a bit is actually making it easier to get visas into the country and making sure that if you get a visa into the country, it's not a political visa.

You're never afraid of being kicked out just because you're doing a business the government does not agree with.

Johny Fernandez: And so if someone is watching, an investor is watching right now, which sectors in Africa look most promising in the next few years?

John Gachora: Well, I think the best thing to look at is history. Where is money going?

I think in the last two or three years, we have seen a lot of money going into renewable energy.

Africa, I would argue, is leading in terms of renewable energy. My own country, 90% of the energy that we use is green energy.

So really, there are great opportunities that we see there.

We've seen a lot of money going to fintechs.

Again, Africa, because of the fact that we are not very developed, we are leapfrogging. So fintechs are doing very well, and we've seen a lot of money going to fintechs.

Another area we have actually seen is quite a bit of FMCG.

Africa has, you know, a billion people, a lot of them young people, and they are starting to get to the level where they have disposable income.

And they see everything on TV that somebody here is seeing, and therefore they desire to have Nike shoes like everybody else. They desire to have wonderful bicycles like everybody else.

And so we're seeing a lot of that market, I would call the FMCG market, doing very well, very well.

So we have seen money then go into trade as well, consumer trade, that is growing very, very quickly.

So I would say those are the big opportunities that I see.

And I shouldn't forget banking and financial services because, obviously, as consumers get a bit of disposable income, a lot of the value is stored in banks.

And so we are seeing the banking sector growing in leaps and bounds, with return on equity up 20% to 30%.

And that becomes very, very attractive.

Johny Fernandez: Yeah. And the younger generation, they're the ones that are pushing Africa to the next level. I think many people could say that.

John Gachora: Absolutely. And that's why fintech is doing very well, because the technology adoption is very, very high thanks to the younger generation.

Johny Fernandez: So I want to dive a little bit more into your background because you studied electrical engineering and computer science at MIT.

So how does that background shape the way you think about technology and AI in banking and in the financial sector?

John Gachora: I would say it has helped a great deal in the sense that no idea in technology is too hard for me to understand.

So I see AI as being a tool that is going to revolutionize how we do business.

I must say, from where I sit, perhaps it's oversold, overstated. I think it's a tool.

I was talking to somebody, and I said I look at it the same way we got better tools to do programming over time.

You know, we went from Fortran to COBOL to C to C++. Then we went to Java, and now we're at a point where almost anybody can program because of AI.

So I think it's a tool that we must all use.

I think businesses need to be careful that they don't try to come up with a strategy for AI.

I think what they need to come up with is to ensure that all the employees are well equipped, they understand it, and they can use it to simplify their jobs.

Johny Fernandez: So I want to talk about risk because we talked about growth and moving forward.

But in your point of view, what are the biggest risks right now, whether it's currencies, whether it's debt or global interest rates, that could slow investment into Africa?

John Gachora: I think actually the biggest one that I see is perception of risk.

Yeah, it's perception of risk.

And obviously, that comes from, you know, people looking at sovereign debt and thinking that's perception risk.

But people must look at it as, you know, if you look at the U.S., Japan and quite a few other countries, debt to GDP is way higher than most of Africa, almost all of Africa, right?

And so when you look at it that way, you have to trust that the people who are running these economies know what they are doing, and they do know what they're doing.

Once you look at it that way, then the debt question, which is a big question, becomes not as concerning anymore.

I think currencies are a concern, I must admit.

We went through a very rough patch, most of Africa, and I would say most of the developing world anyway, between COVID and, I would say, two years ago.

They went through a very rough patch in currencies, whether it was Sri Lanka, Indonesia, Kenya, Uganda.

I mean, we all went through that currency problem, but I think we have all come out of it very well.

If you look at most African governments today, their foreign currency reserves are at an all-time high.

I look at my own country. We now have foreign currency reserves that cover close to seven months of imports.

Historically, we have maintained four, which tells me that then our currency is going to be quite stable for quite some time.

So given all that, then perception of risk is what needs to change.

Johny Fernandez: And John, to wrap up, the summit talked about Africa's next chapter.

So in one sentence, what does that chapter look like for Africa?

John Gachora: Great opportunities.

We are no longer building there. We believe in it. We are investing ourselves.

It is looking at, again, where the cook is eating their own food, then that food must be very good.

Johny Fernandez: Awesome. Well, John, thank you for stopping by.

John Gachora: Thank you very much.

Johny Fernandez: Thank you, gentlemen.