Yaw Appiah Lartey, Deloitte Africa’s Head of Infrastructure and Capital Projects (I&CP) and Partner for Strategy and Transactions, has called for greater adoption of blended finance as a solution to the persistent funding challenges facing infrastructure and business development projects across Ghana and the broader African continent.
Speaking during a panel discussion at the 10th Ghana CEO Summit, Mr Appiah Lartey underscored the importance of blended finance in addressing what he described as the “missing middle” within Africa’s financing ecosystem.
Blended finance is a strategic funding model that combines public, philanthropic and private-sector capital to support sustainable development projects that might otherwise struggle to secure investment.
According to Mr Appiah Lartey, the financing gap is particularly evident among projects seeking between US$1 million and US$5 million, a range that often falls outside the appetite of both local and international financiers.
He explained that while many commercial banks in Ghana face limitations in funding projects above certain thresholds, international investors and development financiers generally prefer larger transactions exceeding US$5 million due to the costs and complexities involved in structuring and executing deals.
As a result, many viable projects are left stranded between the two ends of the financing spectrum.
Mr Appiah Lartey noted that advisory firms such as Deloitte play a crucial role in closing this gap by helping project developers structure bankable deals and connect with appropriate funding sources.
“As advisors, we act as intermediaries between the developers and the lenders or financiers,” he said, explaining that Deloitte works closely with both parties to facilitate investment and unlock funding opportunities for projects with strong growth potential.
Mr Appiah Lartey explained that blended finance brings together commercial investment and funding from development finance institutions (DFIs) and development partners, which typically support the early and higher-risk phases of projects. This support often covers project preparation, feasibility assessments and advisory services that enhance a project’s attractiveness to private investors and commercial lenders.
According to him, development partners play a crucial role in reducing investment risk by taking on some of the uncertainties associated with the initial stages of a project—risks that private financiers are often unwilling to bear.
Illustrating the concept with a salt mining project, Mr Appiah Lartey noted that investors are usually hesitant to commit funds during the exploration phase due to the level of uncertainty involved. However, once development institutions provide technical and financial support and help establish the project’s viability, commercial banks and private investors become far more willing to invest.
Mr Appiah Lartey explained that the approach has gained significant traction in recent years because it allows critical infrastructure projects, business expansion initiatives and other development programmes to proceed even when traditional financing is limited.
He noted that in Ghana, institutions such as the Ghana Infrastructure Investment Fund play a pivotal role in facilitating blended finance transactions. Similar organisations across the continent, including the Development Bank of Southern Africa, provide comparable support to drive investment and development.
According to Mr Appiah Lartey, these financing mechanisms are crucial for attracting capital, reducing project risks and accelerating economic growth across Africa.