Africa’s Growth Engine: An Exclusive Conversation with Sim Tshabalala, Standard Bank Group CEO, on Empowering the Continent’s Future

As part of our Road to Davos Interview Series, we sat down with Sim Tshabalala, CEO of Standard Bank Group, to explore the dynamic landscape of Africa’s economic future. Tshabalala shared his insights on the continent’s rapid growth trajectory, the pivotal role of the African Continental Free Trade Area (AFCFTA) in fostering intra-Africa trade, and the bank’s commitment to driving sustainable development through innovative financial solutions. Our conversation delved into key challenges and opportunities, including Africa’s energy transition, the rise of digital finance, and the critical importance of investing in infrastructure to unlock the continent’s full potential. 

Africa Collective: Can you briefly introduce yourself and your organisation? 

I am the CEO of the Standard Bank Group, a position I have occupied since 2013. I am a lawyer by profession and began my career in investment banking. 

Standard Bank Group is Africa’s largest financial services organisation by assets. We have been operating in Africa for 162 years and are headquartered in South Africa. We operate in 20 countries in Africa, four global centres (New York, London, Dubai and Beijing) and two offshore hubs (Jersey and the Isle of Man).  

Our unique footprint provides us with access to sub-Saharan Africa’s attractive economic growth. 

As at 30 June 2024, we have assets of approximately $170 billion. We generated a return on equity of 18.5%, with a common equity tier 1 ratio of 13.5%. Our businesses in Africa (outside of South Africa) contribute approximately 40% to the Group’s headline earnings. 

Africa Collective: What is your organisation’s primary focus or mission? 

Our purpose is to drive Africa’s growth. 

We are client-led and digitally enabled. We provide comprehensive and integrated solutions to our clients. We are focused on driving inclusive growth and sustainable development for Africans. 

Africa Collective: How do you see your organisation as a pan-African champion? 

We expect that Africa will become the fastest growing region in the world by 2030. Over the same period, Africa will continue to become more interconnected, with increasing trade under the African Continental Free Trade Area ( AFCFTA) – the largest free trade area in the world. Africa’s trade with the rest of the world will also continue to expand rapidly. 

We have a strong, on-the-ground presence in 20 countries in Africa. These businesses serve a wide range of clients in the countries in which they operate, and are generating attractive returns. 

Our international network maps to pools of capital and centres of trade. As the leader in facilitating Africa trade and investment, we provide local and global investors with access to markets, and access to finance.  We actively promote key intra-Africa trade initiatives, and are a committed partner to, and champion of, AFCFTA. Our clients are well-placed to benefit from these growing flows of capital and trade.  

Africa Collective: Which topics and themes related to Africa would you like to see more prominently featured on global platforms such as the World Economic Forum? 

Some of the things that we are spending a lot of resources and time on – cyber security; anti money laundering/ combating the financing of terrorism; artificial intelligence; digitisation; the opportunities and risks that uncertain geopolitics can bring; a just energy transition, as well as Africa’s wider infrastructure needs; and driving sustainable and inclusive growth in Africa. 

Africa Collective: Can you share an example of a successful partnership you have been part of in Africa? 

Stanbic Bank Kenya, a subsidiary of Standard Bank Group, along with MiDA Advisors, announced a partnership with Acorn Holdings, a renowned real estate developer, to facilitate a USD$700 million in long-term blended finance commitments for green, affordable student housing in Kenya. The transaction comprised up to USD$180 million commitment from the United States Development Finance Corporation and raised funds from Kenyan capital markets as well, deepening the positive impact of the transaction of the Kenyan capital markets and providing an opportunity for investors to participate.  

The collaboration will result in the construction of 35 certified green housing projects, creating approximately 48 000 new student beds over the next 10 years, making it the single largest investment into student housing in Africa. The initiative will create an estimated 15 000 direct jobs and 35 000 indirect jobs. 

Africa Collective: What has been your most inspiring experience in your work with Africa? 

Contributing to the narrowing of the energy deficit in Africa and investing in sustainable energy. 

Climate change and energy security are important issues with implications for Africa’s growth. As the largest financial services group in Africa, Standard Bank plays a leading role in supporting a just energy transition for Africa. 

We are committed to supporting the energy transition through innovative financing, and targeting specific areas, including transition fuels, solar and wind project, energy efficiency, electricity distribution networks, green buildings, carbon finance and climate change adaptation. We are even more committed to ensuring that this transition is just, and that Africa’s path forward balances Africa’s right to use its natural resources as we decide, access to electricity, energy security, food security, economic growth and human development with the decarbonisation required to ameliorate the impacts of climate change. We believe that there is an important role for transition fuels (including oil and gas) in Africa’s path towards a more prosperous and sustainable economy. 

Our target is to mobilise more than R250 billion (approximately $14 billion) in sustainable finance by the end of 2026. Since March 2022, we have cumulatively mobilised sustainable finance of approximately US$7 billion to advance green and renewable energy initiatives across Africa, thereby driving sustainable growth and energy independence throughout the continent. 

Africa Collective: What advice would you give to other leaders/organisations/companies looking to make a positive impact in Africa? 

To appreciate the significant economic and investment opportunities in Africa. Key drivers such as its youthful demographic, increasing urbanisation, increasing consumer demand and continuing opportunity for technological innovation offer exciting growth prospects. 

At the same time, it is critical to recognise the responsibility to deliver positive impact. We strive to achieve this through our day-to-day operations which support important aspects of Africa’s development like education, infrastructure, financial inclusion and other UN SDGs.  

To maintain a long-term view. We’ve been operating on the continent for 162 years which means we have established on-the-ground, experienced and empowered teams with deep local and global expertise. 

Africa Collective: What key message would you like to share about Africa’s potential and opportunities with the global community? 

The outlook for sub-Saharan Africa is improving. Several large countries have implemented or are implementing economic reforms which will drive positive change in the long run. Growth in most African economies is now approaching, or has already breached, pre-pandemic averages, underscoring their notable resilience, and notwithstanding the turbulent geopolitical environment. Growth is expected to recover to around 4.0%, and sub-Saharan Africa is expected to become the world’s fastest-growing region by 2030. 

Standard Bank is bullish on Africa’s prospects, and we are committed to Africa, her people and her prosperity as we aspire to achieve our purpose of driving Africa’s growth.  

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About the Road to Davos – Leadership Voices Series

Leading up to Africa Collective’s Davos annual series of events during the period of the World Economic Forum in Switzerland, taking place from 20-24 January 2025, Africa Collective is speaking to a collection of foremost thought and business leaders in both the private and public sectors as part of our ongoing effort to highlight opportunities in Africa. Our objective with the Road to Davos – Leadership Voices Series is to position African topics on the global stage through the lens of leaders from the continent or who lead organisations with interests in the continent.