This is a point that is close to my heart. I believe that one of the problems with African economies is that they lack equity. Really, there is a fundamental lack of equity. We say 'fonds propre' in French, but it's not the same thing. Well, technically it's the same thing, but I think we are all used to using these terms, so I will use 'equity' rather than 'fonds propre'. It is really the opposite of debt. And I believe that the first provider of equity capital in all the economies I know is the insurance industry, through long-term savings that are then converted into investment. And if you look, well, I'm talking about Prudential, which was created in 1848, and when I left Prudential, it was the largest investor on the London Stock Exchange, owning about 3% of the London Stock Exchange market cap, and therefore having stakes in absolutely every sector of the economy in equity. Equity, equity, equity.
Because there is an insufficiency of capital in Africa, we tend to go straight to debt. Debt must come after equity, not before. And if you look, I try to explain to everyone that all the money in the American economy is pension fund money. BlackRock, BlackRock manages pension fund money. Pimco, Pimco manages pension fund money. They spend their time visiting pension funds in all the American states, the firefighters, the teachers, to pool capital. That's what creates the trillions of dollars. And so I looked at this. It's not Silicon Valley. If you take Silicon Valley, which is the engine of value creation and wealth creation in the American economy, it is first and foremost pension fund money that finances Silicon Valley. So there is really a misconception. People think it's the banks that finance the economy. Absolutely not. Banks have capital constraints that mean they can lend a little, but they will never, ever finance long-term growth.
And so in African economies, this is a missing link in the system. I mean, we have the demographics to do it. We have the investment needs to do it, and on top of that, we can generate extremely high returns because in the development phase we are in, if we package the right products, we can offer savers a risk-return profile that is very attractive. Those among you who have been to Abidjan may have seen a large bridge, the Third Bridge, Riviera Marcouri. That is a project on which I personally spent over five years, and we had closed it in December '99 before the coup d'état. Work had started, we had laid the first stone, but the interesting point is that I couldn't close the equity for the project. When you want debt, there is always some. Financial markets function in such a way that debt is easy because it is less risky. There is an abundance of capital. What is difficult is finding equity that allows you to then leverage to do the project. And I had gone to see, it so happens that, bizarrely, because French-speaking states are unfortunately mostly in pay-as-you-go pension systems, which means this point is not understood, and there was a quirk: the army had a pension fund in Côte d'Ivoire. So I went to see General Koulibaly, who ran the army's pension fund, and I sold him my toll bridge project, saying, 'This is the project that will pay your soldiers' pensions, and you can explain this to them.' And he is an open-minded man and he had accepted. So it was very strange because we had gathered all the financiers on the top floor of the BAD, the African Development Bank. There was a general in uniform, and no one understood what the general was doing at the signing of the financing agreements. But this was exactly one of the essential functions for me of insurance in a continent where we have this demographic which is potentially a future problem, where we have investment opportunities with very, very high returns.
One of the projects I did that had the highest profitability was the interconnection between Côte d'Ivoire and Mali. On the other side of the border in Côte d'Ivoire, it was pitch black. And so just by drawing that line, the returns were triple-digit. So we can really enter into virtuous circles where we make high-quality investments. We also talked about ESG, we talked about solar, we talked about wind energy. We can develop all of this, which is for the greatest benefit of African economies. Preparing the future by providing pensions for future African retirees and avoiding falling into the debt problem. Because with this debt, you end up borrowing in foreign currency with significant exchange rate risk for projects that often only have revenues in local currency. And I would say the last point is that I think we really cannot have real development without institutional investors in local currency. We cannot have real development without institutional investors in local currency. It is absolutely necessary, and insurance companies will be the first. We must therefore only encourage using the demographic phase we are in to accumulate capital. Insurance companies must be positioned to manage this capital and invest in the economy. And we must also take this opportunity to create local capital markets. This is something that is well understood in Morocco. I believe that here in Casablanca, there is a very active stock exchange, but it is also an indispensable element for development.
There are aberrations. You have a company like Paystack, perhaps you've heard of it. Paystack is a digital payments company created by a young Nigerian about 6 or 7 years ago. He couldn't find financing. You know where he found his financing? He found it in Silicon Valley for a startup that only works in Nigeria and is completely local. And that is truly an aberration. The fact that dynamic entrepreneurs cannot find financing, that there is no reasonable financing solution in their own economy, is not normal. And just for the story, he sold his company to Stripe after 5 years for 250 million dollars. So the people who invested $100,000 in equity there got a good return. So when I talk about absolutely exceptional returns, I'm talking about this kind of thing. In Africa, we have opportunities to generate this kind of explosive growth and returns. And I believe it is a very noble mission for investors and insurance companies to participate in this. So really, I am preaching for this to be understood, for us to develop a true equity culture, which for me is the distinctive characteristic of the American economy. I can trace all the success of the American economy to the abundance of equity capital. And all these venture capitalists and all those people, they take their money from pension funds and then invest it long-term in the American economy with real risk-taking. The problem with debt is that there is no risk-sharing, and when things go wrong, you are strangled because the debt must be paid. There you go. And so for me, equity capital will always be superior to debt capital. In any case, in terms of preference and appetite, I say this is a subject on which insurance companies really have a lot to do.
So to summarize, I believe that in everything related to pure risk, risk management, property protection, there are enormous growth opportunities because we can see that Africa has very strong economic growth driven by demographics, driven by entrants into the middle class. A bad joke I used to make was that I liked serving the Asian middle class because the cake was growing faster than our ability to eat the cake, because you have new entrants, a market in constant expansion, and in fact you are running because you have a company with limited capacity, and the economy generates so many new entrants into the middle class that you can grow and penetration drops because there have been so many new entrants that despite all your efforts, you cannot increase penetration. So these are unique markets. I think in Africa we have opportunities of this kind. Of course, Africa is diverse. There are countries like Morocco that are doing very well. There are other countries that are doing less well. But when people tell me that, I say, listen, in Europe, there is Sweden and then there is Serbia. No one says, 'I'm not going to go to Europe because there is Serbia.' So I simply ask people to show discernment when looking at African markets and to accept that in any geographical area, there are countries that do very well, countries that do less well, but that overall, there is a positive dynamic, and we hope that contagion will go from the countries that are doing well to the countries that are doing less well, rather than the other way around. So I am optimistic. I believe in the first case, meaning the countries that are doing well pull the others up. And I will again compliment Morocco. I believe Morocco is playing this role in Africa. When we see what Morocco is doing in sub-Saharan Africa, it is exactly that: building on its strengths and successes to then export know-how and capital to other African countries. And I also believe that those best placed to invest in Africa are Africans. And I often say, at least to the heads of state who listen to me, like President Kagame, that if they do an 80/20, they should spend 80% of their time talking to domestic companies, not international companies. Because the more prosperous domestic companies you have, the higher the probability that international companies will invest in your country. You will struggle to attract quality foreign investors if you do not have a prosperous fabric of national companies. And all the things that will make your national companies succeed are the same things that will allow a foreign company investing to operate profitably. So all of this, I think, is coherent.
Insurance was my entry point, and it has an absolutely essential role to play in the process I described, for the protection of property and people, and also for the accumulation of quality savings and the formation of equity capital that will itself support the formation of successful companies. So there you go, I am very happy to have been able to participate in this event. When I see the success of this event, it makes me optimistic because I believe you can really measure the degree of sophistication and development of an economy and a society by the place that insurance occupies in that economy or society. And so I consider your numerous and high-quality presence here as a reason to be optimistic about Africa, because it means this message is getting through, it is well understood, and therefore it creates positive prospects for the African economy. There you go, so I thank you for your attention and I wish you a good continuation of your work. Thank you very much.
