By James Agin,
Across Sub-Saharan Africa, businesses are navigating an economic environment shaped by evolving global and regional forces. Currency movements, changing capital flows, and shifts in trade dynamics continue to influence strategic decisions across industries. While these conditions introduce complexity, they also present opportunities for businesses and institutions to adapt, reposition, and grow.
Recent years have seen notable adjustments in capital flows, particularly as global financial conditions tighten. According to data from the African Development Bank, net financial flows to developing countries declined significantly in 2022, a trend reflected across multiple emerging markets. In 2023, many African currencies, including those in East Africa, came under pressure. Policymakers and financial institutions responded with targeted interventions aimed at preserving economic stability and curbing inflation.
While each country’s response has been tailored to its context, a common thread is the increasingly proactive role of monetary authorities in managing volatility. This coordination has been vital in restoring investor confidence and facilitating a more predictable operating environment for businesses that rely on cross-border trade, capital access, and foreign currency exposure management. These efforts are beginning to lay a foundation for more sustainable and balanced growth.
Amid these developments, corporate and institutional clients are reassessing their operating models. There is a clear shift toward greater financial agility, with firms placing increased focus on liquidity management and more adaptive funding strategies. Shorter-tenor financing, particularly in trade and working capital, has gained traction as businesses seek flexibility in managing both cost and timing of capital. At the same time, currency risk mitigation, through hedging and structured treasury solutions has become a more central component of financial planning.
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We are also observing a shift in boardroom conversations away from purely cost-of-capital considerations toward more strategic thinking about capital structure, portfolio diversification, and risk-adjusted returns. Many clients are re-evaluating capital expenditure pipelines, not as a retreat from investment, but as a recalibration aligned to macro cycles and evolving market demand. This is particularly evident in infrastructure, manufacturing, and services sectors, where financing decisions are increasingly tied to operational agility and scenario-based planning.
These trends are also redefining the role of financial institutions. The traditional transaction-driven model of banking is no longer sufficient in today’s operating environment. Clients expect more: timely insights, sectoral understanding, and a partnership approach that goes beyond credit. In response, we have sharpened our focus on integrated client engagement, embedding ourselves in the realities of each business and designing financial solutions that align with both immediate needs and long-term strategy.
As part of this effort, we recently hosted a regional economic forum convening clients, investors, and policymakers. The dialogue centred on practical strategies for navigating uncertainty, enhancing yield in a moderating interest rate cycle, and optimising financing structures in capital-constrained markets. The conversations underscored the importance of data-driven decision-making, and of building institutional resilience through a better understanding of both macro trends and operational risks.
This form of engagement reflects a broader principle: our role must extend beyond capital provision. It includes strategic advisory, cross-market insight, and the ability to structure solutions that enable growth across varied and often complex environments. With a pan-African presence, Absa is well positioned to support clients operating across jurisdictions—whether through access to capital markets, foreign exchange and risk management capabilities, or bespoke structuring for regional and cross-border transactions.As businesses scale across the continent, there is growing demand for solutions that are both locally relevant and regionally harmonised. The emergence of initiatives such as the African Continental Free Trade Area (AfCFTA) underscores the need for financial partners who can navigate regulatory diversity while supporting seamless cross-border execution. Our clients are increasingly seeking insights not just on where to invest, but how to structure transactions to manage compliance, liquidity, and risk cohesively across jurisdictions.
Looking ahead, the future of business in Sub-Saharan Africa will be shaped by the partnerships we forge today. Long-term value creation will depend on how well we understand our clients’ objectives, their constraints, and the environment in which they operate. Resilience, in this context, is not simply the ability to withstand disruption. It is the capacity to recognise opportunity in changing conditions and to respond with clarity, foresight, and the right support.
That is the kind of partnership we should commit to, one grounded in trust, informed by insight, and designed to endure.
The writer is the Corporate and Investment Banking Managing Principal at Absa Bank Kenya PLC
