Africa at heart of global growth under South Africa’s G20 lead

The government has recommended the establishment of a G20 Africa Engagement Framework, aimed at addressing fiscal and monetary challenges

South Africa is using its presidency of the G20 this year to place Africa at the centre of the global economic agenda and showcase the continent’s potential as the world’s next growth frontier, Anthony Costa, Head of Secretariat for B20 South Africa, told delegates at the Western Cape Investment Summit.

Costa said South Africa’s role as host of the G20 and its affiliated Business 20 (B20) process gives it a unique opportunity to shape policy, build partnerships and advance economic inclusion across the continent.

“We are hosting the biggest economies in the world and partner guest countries in a process primarily aimed at policy development but also at building relationships and connections,” he said.

“South Africa’s G20 presidency has deliberately put Africa at the centre.”

B20 task forces advancing Africa’s priorities

Costa explained that under South Africa’s leadership, the B20 – the formal business arm of the G20 – has launched a series of task forces focused on key economic areas, each chaired by South African executives with co-chairs from leading companies around the world.

“We’ve had over a hundred C-suite executives from the United States, China, India, Europe and the rest of Africa contributing to policy recommendations,” he said.

“These have been handed over to South Africa’s G20 presidency and will culminate in a summit alongside the G20 Leaders’ Summit.”

The aim, Costa said, is to translate the international attention Africa is receiving into concrete economic opportunities.

“There’s incredible global interest in Africa, not only in South Africa. This is the world’s remaining growth frontier – the youngest, most dynamic population, and still abundant with opportunity.”

Agriculture, climate and digitalisation driving opportunity

Costa highlighted Africa’s vast agricultural potential, noting that smallholder farmers produce up to 80% of the continent’s food, yet Africa still imports around $40 billion in food annually.

“The opportunity to improve efficiency, include smallholders in value chains and link them with Africa’s food industries is enormous,” he said.

Africa also holds 60% of the world’s undeveloped arable land, which he said presents an economic and food security opportunity – particularly for South African investors and agribusinesses with advanced expertise.

Turning to climate finance, Costa warned that only 5% of global climate funding currently reaches Africa, despite the continent being one of the most climate-affected regions.

“The challenge is how we create additional flows of finance, not as aid, but as investment opportunities,” he said.

He also pointed to Africa’s untapped digital economy, where only 40% of the population is online, calling it a critical area for growth and employment.

“We’ve seen the benefits of digital connectivity in South Africa. The same opportunity remains across the continent to enable industries like business process outsourcing and digital services.”

Infrastructure and finance at the heart of South Africa’s G20 agenda

Costa noted that the infrastructure financing gap in Africa exceeds $100bn annually, according to the African Development Bank.

The B20’s Infrastructure Task Force is working to identify ways to reduce the cost of capital and unlock greater private-sector investment.

“How do we ensure that finance is more affordable in the face of real risk? We need to see more competitive capital flows into the continent.”

He added that small and medium enterprises (SMEs) must be a key part of this equation. While SMEs contribute 80% of jobs in Africa, they account for only one-third of South Africa’s GDP, compared with around half in advanced economies.

“We know what a challenge unemployment is in South Africa. Developing the SME sector is vital to addressing that crisis.”

G20 Africa engagement framework

Costa confirmed that the South African government has recommended the establishment of a G20 Africa Engagement Framework, aimed at addressing fiscal and monetary challenges faced by African nations and improving governance and institutional resilience.

The framework would also explore ways to reduce the cost of capital through international cooperation.

“… former finance minister [Trevor Manuel] has proposed a G20 commission into the cost of capital. We’ve engaged with ratings agencies and expect to see progress on this front.”

Costa said the private sector’s involvement in these processes is essential to ensuring that investment and reform are inclusive, transparent and sustainable.

Partnerships, not aid

Costa emphasised that the B20 process and South Africa’s presidency are focused on building partnerships, not dependency, drawing participation from new international partners such as the International Finance Corporation (IFC) and major multinational corporations.

“We’ve had partners that have never worked with the G20 before. They see opportunity on the continent… not just challenges.”

He noted that countries such as Canada and Japan are showing renewed interest in Africa, with Canada’s business community beginning to view the continent as a new growth destination.

“It’s no longer a question of choosing between South–South or South–North trade. There are opportunities across all directions.”

Public-private partnerships essential

Costa also underscored the importance of public-private partnerships (PPPs) in driving Africa’s growth, citing South Africa’s Operation Vulindlela as an example of successful collaboration between government and business.

“These partnerships need to be transparent and well-governed. When structured properly, PPPs allow the private sector to deploy resources and expertise in the national interest.”

He emphasised the need to expand opportunities for women-owned businesses and SMEs, calling inclusivity a cornerstone of sustainable development.

A lasting legacy for South Africa’s G20 presidency

Costa said the US will host the G20 and B20 next year, but South Africa’s presidency has already achieved notable success in maintaining cohesion and consensus within a volatile global environment.

“South Africa has done an incredible job under very challenging circumstances. We’ve managed to convene a coalition and deliver consensus, including a finance communiqué.”

US businesses such as Microsoft, Visa, JP Morgan and Starlink have been active participants in the B20 process, alongside the US Chamber of Commerce, Costa said.

“They recognise the importance of South Africa as an inter-regional bridge and of Africa as the next great growth frontier,” he said.

Costa encouraged delegates to see South Africa not just as a gateway, but as part of a continental platform for growth and partnership.

“Africa’s rise is not a zero-sum game. The prosperity of one region supports the growth of another. The Western Cape, with its innovation and governance, is uniquely placed to play a leading role in that story.” ESI

Cover photo:  xtrekx©123rf