Private equity body pledges to tackle regulation, policy deficiencies

The African Private Equity and Venture Capital Association (AVCA) has pledged to tackle regulation and policy challenges hindering fund managers in Nigeria.

According to the organisation, which promotes private investment coming into Africa, the issues would be addressed through increased advocacy and engagement with critical stakeholders.

The chief operating officer of AVCA, Mrs. Abi Mustapha-Maduakor, stated this in Lagos on Thursday during an event it organised in partnership with a Lagos law firm, The New Practice (TNP), aimed at bringing together fund managers, investors, portfolio companies and professional advisers for professional networking.

According to Mustapha-Maduakor, the infrastructural deficit in Nigeria is very huge, totaling about $30 billion per annum. “The government cannot fund the deficit alone. We need the private sector to do it and for the private sector to put their money, we need the enabling environment. Therefore, our focus in the next five years is to work across the key African hubs such as South Africa, Morocco and Nigeria. We will work with government players in those countries and do the best we can to create the right regulatory and tax environment for private equity to grow,” she said.

She added that the group had succeeded in gathering data on private equity in Africa, which was not in existence in the past. AVCA, she noted, is a pan-African industry body, which promotes private investment in Africa by playing the role of an effective change agent for industry research, best practice training programmes and networking opportunities made up of private equity firms, law firms and other advisory firms.

Her words: “We act as advocates in bringing in institutional investors into the continent. We do research on private equity to allow anyone that wants to invest in Africa understand the landscape.”

Speaking to The Guardian, the managing partner of TNP, Baba Alokolaro, said AVCA is made up of general partners that are fund managers, limited partners that finance investments, portfolio companies that receive finance as well as advisers such as TNP that advise fund managers and portfolio companies.

He described the programme as a networking event. “It brings together practitioners in the private equity industry, people looking for finance, general partners that are fund managers, firms looking to invest and a number of advisers in legal, financial advisory and accounting space,” he stated, adding that it was aimed at bringing out professionals to talk finance, business and have a good evening.

“We have had a number of Nigerian businesses that have received dollar investments from fund managers, which is essentially foreign direct investment,” he enthused.

Also, TNP partner, Babajimi Ayorinde, said poor dispute resolution mechanisms discourage investors. According to him, foreign investors consider the mechanisms in place for dispute resolution before investing in any country.

He added that with arbitration as an alternative dispute resolution mechanism gaining popularity in the country, investors now have the opportunity to choose arbitration as a means of resolving their disputes within an effective, speedy and confidential framework.