Suleiman: Domestic capital first layer to leverage international funding

The CEO of Sterling Bank, Abubakar Suleiman, recently emphasized the significance of accruing and aggregating domestic capital as the fundamental layer to leverage international funding for driving social impact projects in Africa. Speaking at the third edition of the Africa Social Impact Summit in a chat with CNBC Africa, Suleiman highlighted the need for a platform that not only fosters conversations but also facilitates the initiation of relationships that ultimately translate into tangible action. Suleiman commended the evolution of the summit, noting that it has transitioned from merely hosting deal rooms to organizing events such as the one by the Lagos state government. This particular event showcased investment opportunities, leading to significant engagement and paving the way for fruitful investments. The model has successfully created a collaborative environment for investors and the public sector to explore opportunities, thereby bridging the gap between capital and impactful projects. Delving into the realm of social development across Africa, Suleiman addressed the challenge of achieving the Sustainable Development Goals and the pivotal role of domestic capital. He underscored the misconception that foreign capital can serve as a substitute for domestic investments, emphasizing the need to attract local investors who possess a deep understanding of the environment and a vested interest in driving positive change. Domestic capital, he argues, not only fuels intelligent investment but also circulates returns back into the local economy, creating a sustainable financial ecosystem. In discussing the behavior of domestic investors, Suleiman pointed out a reluctance towards early-stage investments compared to their foreign counterparts, particularly venture capitalists. Local investors often seek established structures and long-term plans before committing capital, signaling a preference for proven concepts. Suleiman stressed the importance of aligning investment opportunities with the needs of the domestic market, cautioning against blindly replicating solutions that may not be tailored to local requirements. Moreover, Suleiman highlighted the integral role of SMEs in the African economy, noting that these enterprises are primarily funded by domestic capital. Despite lacking polished presentations, SMEs thrive due to the risk-taking propensity of local investors who support founders within their community. This grassroots support sustains a vibrant SME ecosystem, underscoring the significance of domestic investments in driving economic growth and innovation. The Africa Social Impact Summit serves as a catalyst for local investors to engage with social impact initiatives, fostering a multi-dimensional approach to addressing critical issues. By convening development finance institutions, global philanthropic organizations, governments, and the private sector, the summit encourages stakeholders to collaborate and strategize on sustainable solutions. Viewing social impact through diverse perspectives enables a comprehensive evaluation of opportunities, paving the way for effective catalyzation, sustenance, and scalability of impactful projects. In conclusion, Suleiman's insights underscore the indispensable role of domestic capital in unlocking social impact across Africa. By prioritizing local investments, fostering partnerships, and aligning solutions with the needs of the community, Africa can leverage its inherent resources to drive meaningful change and sustainable development.