Minister of State at the Finance Ministry, Dr. Mohammed Amin Adam, clarified that "perceived risk" entails the belief that a country or continent lacks the capacity to enhance the value of investments, thus hindering returns.

To alter this perception, Dr. Adam stressed the importance of African leaders collaborating, sharing knowledge, and standardizing regional regulations. Such harmonization would ensure consistency and reliability in regulations, regardless of the political climate, thereby mitigating the perceived investment risk in Africa.

Dr. Adam pointed out that available data indicates that out of the $2.3 trillion earmarked for global renewable energy investment, only $55 billion has been directed towards Africa. He attributed this discrepancy to the continent's inconsistent policies.

Speaking in an interview with journalists on the sidelines of Africa Climate Summit 2023 in Nairobi, Kenya, Dr. Mohammed Amin Adam said, “It is important for us to develop partnerships among ourselves with the aim of creating a regional policy environment that can incentivize investment.”

“We must collaborate, share knowledge, and have harmonized regional regulations so that, regardless of the political environment, the regulations are consistent and sound. This should help to reduce the perceived risk of investing in Africa and allow us to attract the level of investment we need,” he stated.

The Minister of State at the Finance Ministry added that, “The international capital market is not favourable to Africa when it comes to access to capital because they often side with what we call perceived risk...That is the perception. But in reality, we have measures and policies in Africa that reward investments. Therefore, the reason for the perceived risk needs to be addressed.”

Dr. Adam did point out that Africa does not have easy access to capital on the global capital market.