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2014.08.0602:48:12UTC+00Equity explosion seen in Africa by Carlyle Group

David Rubenstein from Carlyle Group LP claimed that Africa's private equity market will experience a boom in the coming years just as the company, together with Blackstone Group, gets into the continent's energy market.

The co-chief executive officer said during today’s US-Africa Business Forum that their initial investment will increase the productivity of other African companies as well as the overall economy. He added that, “Opportunities there are far greater than people thought years ago and the great explosion in private equity, if it’s going to occur anywhere around the world in the next couple of years, is probably going to be in Africa.”

Estimates from the World Bank indicate that Africa is in need of an additional $50 billion each year to improve its infrastructure for energy and transportation, an amount which Carlyle Group will begin to make up for. The continent currently accounts for 1% of global investments in private equities.

Both buyout firms Carlyle Group and Blackstone announced today that they have signed agreements with Nigerian business man Aliko Dangote for separate projects. Blackstone will join the effort to invest $5 billion in five years time to fund power projects in Africa’s sub-Saharan regions, while Carlyle Group will enter gas and oil projects in Nigeria for an unspecified amount as of yet.

Other entities have also expressed their commitment to extend investments in Africa. US President Barrack Obama  and Commerce Secretary Penny Prtizker revealed that US companies will invest $14 billion on top of 10 trade missions while World Bank President Jim Yong Kim committed $5 billion in aid to improve the power situation.

MasterCard Inc CEO Ajay Banga said that the risks in the continent are manageable as a response to Carlyle Group’s comment that there are difficulties as far as taking control of assets and enacting changes go.

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