African development finance institutions are playing a key role in unlocking trillions in capital for infrastructure and industry on the continent.

Projects like the Lobito Corridor show how African-led initiatives attract global investment with a strong emphasis on local ownership.

Their co-investment model blends local leadership with international partnerships, reshaping development finance.

In a world where development finance is undergoing a profound shift, Africa’s financial institutions are quietly but powerfully redrawing the playbook. Moving beyond traditional models, African Development Finance Institutions (DFIs) are stepping forward as co-architects of an investment-led future. Their contributions are reshaping not only the continent but the very model of global partnership.

The Alliance of African Multilateral Financial Institutions (AAMFI) — created last year by DFIs investing a combined $70 billion — is helping drive this transformation through sustainable economic growth and financial self-reliance. From cross-border energy platforms to strategic transport corridors, these institutions are pioneering new growth models and credit enhancement initiatives grounded in local capital, institutional strength and global collaboration.

Across Africa, now, DFIs are catalysing economic opportunity through partnerships built on co-investment, local leadership and shared value creation. This approach was evident at the recent IMF/World Bank Spring Meetings, where African ownership and leadership of initiatives such as the Lobito Corridor attracted renewed U.S. and European backing. Africa’s elevated voice at global platforms such as COP27, COP28 and the World Economic Forum underscores its growing role in shaping international development priorities.

This evolution is not unique to Africa. It represents a new understanding of a universal imperative in a multipolar world. Traditional aid was never a primary driver of progress. Resilience and sustainability increasingly depend on empowered local institutions driving scalable investment and development.

Unlocking Africa’s capital for growth

One of Africa’s greatest untapped resources may not lie beneath the ground, but in its own financial systems. According to the recently published State of Africa’s Infrastructure Report 2025, Africa holds more than $4 trillion in mobilizable capital from institutional assets, banking sector liquidity and sovereign reserves. Of this, approximately $1.1 trillion sits within institutional pools such as pensions, insurance and sovereign wealth funds. Yet today, less than 2% of African pension funds are allocated to infrastructure.

This is a massive opportunity. Targeted reforms to allocate up to 20% of these assets to high-impact growth sectors could reshape Africa’s development — cutting reliance on external finance, boosting local ownership of infrastructure, and strengthening economic sovereignty.

African DFIs are hard at work trying to unlock this potential. We’re mobilizing capital into high-impact sectors like power, transport and industry by creating investment platforms and partnering with regional and global institutions, including pension funds and development banks.

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Transforming industries and infrastructure

Support from African development finance institutions such as Africa Finance Corporation and the Fund for Export Development in Africa for ARISE Integrated Industrial Platforms’ recent capital raise shows how regional partnerships drive the growth of Africa’s industrial ecosystems. Collaborations with international institutions are expanding and diversifying sources of development finance. Initiatives such as Infracredit in Nigeria and a planned platform in East Africa are developing credit-enhanced solutions within local capital markets.

African development finance institutions have financed over $150 billion in power, transport, housing, agribusiness and manufacturing over the past decade, according to the Association of African Development Finance Institutions and the African Development Bank. This is capital staying on the continent, circulating value within African economies and building long-term resilience.

The Lobito Corridor: A case study in African-led development

The Lobito Corridor stands as a prime example of African-led, globally supported development in action. Spanning Angola, the DRC and Zambia, the corridor connects some of Africa’s most resource-rich regions to global markets via the Atlantic coast. AFC serves as the key strategic and financial advisor for this transformative project, coordinating a complex coalition of African governments, private investors and international partners. Crucially, AFC advised the Lobito Atlantic Railway (LAR) Consortium for the Benguela rail line running through Angola, and is spearheading the development of an 830-kilometer greenfield railway to link Zambia’s mineral-rich North-Western Province to the Lobito Port in Angola.

At the recent Spring Meetings in Washington, D.C., Africa Finance Corporation secured renewed US government backing, affirming its leadership and reflecting broad international support from the EU, AU and others.

Lobito is a key export route for strategic minerals vital to global energy markets. It also promotes regional integration and industrialization. The project shows how African development finance institutions can structure bankable infrastructure to attract global capital. It’s already spurring investment in energy, logistics and rail, with Africa Finance Corporation providing credit enhancement and blended finance to support its sustainability.

A model for the future of global development finance

Africa’s DFIs are not only addressing the continent’s challenges — they are structuring pragmatic solutions that offer replicable models for development finance globally. Built on the foundation of PPPs, African DFIs combine sovereign alignment with private capital, blending commercial discipline with developmental purpose.

In a multipolar world, where resilience and local leadership matter more than ever, African DFIs are showing what practical, context-driven finance can look like. Over the past five years, they have raised record levels of capital for the continent in global markets — a signal of rising international confidence in African-led models. These institutions are scaling not through breakthrough innovations, but through disciplined adaptation: syndicated loans, hybrid bonds and Shariah-compliant structures reflecting the realities of local markets.

This progress is rooted in trust. African DFIs have deepened long-term funding partnerships with institutions in Japan, China, and Korea — relationships built on consistency, performance and a shared understanding of risk and return. These are not transactional alliances; they are mutual commitments to making capital work where it matters most.

This is not inward-looking development. It is collaborative, grounded and globally relevant. In a world that increasingly questions old development orthodoxies, African DFIs offer a viable alternative — anchored in ownership, adaptation and results.

For this progress to build momentum, the rest of the global development architecture must shift. The more mature multilateral development banks — many of which benefit from substantial government funding — must do more than operate alongside African DFIs. They must partner with them. Their capital should be used to provide credit enhancements, guarantees and blended structures that multiply investment flows. The question should not be “how to spend $1 billion,” but rather “how to mobilize $4 billion” by using that $1 billion to unlock private capital.

And whatever remains of traditional development assistance should be directed with purpose. Global investors need to feel more confident about African risk. Not by replacing market capital, but by enabling it. That is how development assistance remains relevant — not as charity, but as a catalyst.