In other parts of the developing world, massive investments in infrastructure established the backbone for other economic which in turn fuelled economic growth. A similar path lies open for African countries, says Kenyan President Uhuru Kenyatta.
Speaking at the Africa Investor CEO Infrastructure Investment Summit in Nigeria, Kenyatta said increased access to infrastructure services such as roads, electricity, telecommunications, water and sanitation, especially in rural areas, entails direct social benefits such as health, education, and women’s empowerment, so helping to achieve a socially balanced and inclusive growth. Equally, deficient infrastructure can hamper economic activities and weaken human development efforts. Poor infrastructure quality especially undermines productivity among manufacturing firms in Africa, he says. Because of this, Kemyatta believes it is critical to address infrastructure deficiencies in order to unlock Africa’s productive potential and maximize infrastructure’s impact on economic growth and human development. However, significant financial resources are required to achieve this. According to Kanyatta, current infrastructure spending stands at US $45 billion a year. However, yearly demand sits at an estimated US $93.4 billion over the next decade if the continent is to meet international standards. Cross-border infrastructure
“An important aspect of our infrastructure development is the need for a regional approach. Economies of scale from regional infrastructure often cut the costs of construction and services,” said Kenaytta. It is therefore vital to promote regional and cross-border infrastructure as it increases trade, improves security, saves money, strengthens natural resource management, addresses the needs of landlocked countries, and builds on national and regional comparative advantages.
Africa50 Fund “The infrastructure gap also requires dedicated financing mechanisms if it is to be bridged. Cognisant of the need, the African Union Heads of State and Government endorsed the creation of a dedicated funding mechanism to accelerate infrastructure delivery in Africa.” The African Development Bank (AfDB) is spearheading the establishment of the Africa50 Fund to mobilise private sector funding to accelerate the rate of infrastructure delivery in Africa. The fund will look to gather support for infrastructure from international capital markets. “It is, in short, a strong statement of Africa’s readiness to address the infrastructure,” says Kenyatta. A defining challenge Kenyatta concluded saying that Africa’s infrastructure needs are a defining challenge. “Let me conclude by observing that Africa profoundly needs regional and continental integration for sustainable development. But integration can only thrive where there exists certain critical infrastructure. Yet for such enabling infrastructure to be present, someone has to invest in it,” he said.
