Since the downturn in global commodity prices in 2015, sub-Saharan African macroeconomic conditions have deteriorated, and 2016 saw the slowest economic growth in more than two decades. To maintain progress in economic transformation, employment-intensive and higher-productivity sectors need to be developed. Manufacturing – including agricultural processing – offers this opportunity, including through participation in regional and global value chains. However, beyond the challenge of macroeconomic stability, discussed in this paper's companion paper, this requires the mobilisation of significant private finance for investment in the sector.

To date, mobilising of finance has been muted and, at current levels, is not strong enought to support growth in the manufacturing sector. Furthermore, the finance that has been mobilised has been concentrated in very few countries. This paper explores how sub-Saharan African economies seeking to attract finance face not only economic constraints, but firm-level ones that are hindering investors' efforts. It goes on to suggest that only by robustly tackling those firm-level constraints, will finance be effectively mobilised on the scale required to drive economic transformation.