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How the Africa Investment Forum is transforming the continent’s approach to infrastructure projects
Streaming across the new bridge linking the Gambia and Senegal earlier this year, cars, trucks and pedestrians celebrated a new era of integration between the two West African countries.
For the first time in over half a century, traders and everyday commuters could travel from one half of the Gambia to the other in a matter of hours, instead of an entire day, or even longer.
The January inauguration of the Gambia River Bridge signaled the end of the risky ferry crossing or the long detour between the northern and southern parts of both nations.
The powerful images that made international headlines showed how essential it is that the continent build roads and bridges that bring us closer together and open up economic opportunities.
The development of infrastructure contributes significantly to human development, poverty reduction, and the attainment of the Sustainable Development Goals (SDGs). Investment in infrastructure accounts for over half of the recent improvements in economic growth in Africa and has the potential to contribute even more.
It is with that focus in mind that the African Development Bank has placed great emphasis on infrastructure as a means to improve the lives of the people of our continent. Infrastructure also serves to foster much-needed regional integration and economic growth. With good reason, these are two of the High 5 strategic priorities of the Bank: improving lives and integration.
Hence the Bank’s heavy investment in this area. The Bank’s 2018 portfolio of financing approvals for transport and urban development infrastructure attained a record number of 19 projects, amounting to $1.9 billion, or 21% of all project approvals1.
Infrastructure is also a key focus of the Africa Investment Forum, launched last year by the Bank and its partners.
“The Africa Investment Forum fulfills a role that no other entity can do in isolation. It draws on the convening power and technical expertise of the African Development Bank and its partners to coalesce governments and relevant stakeholders around the critical mission of accelerating the pace of investment into Africa,” said Chinelo Anohu, Head and Senior Director of the Africa Investment Forum.
Preparations for the 2019 Africa Investment Forum, a Bank-led initiative, are in full swing. The forum was launched last year by the Bank and its partners – Africa50, Afreximbank, the European Investment Bank, the Africa Finance Corporation, the Development Bank of Southern Africa, the Trade and Development Bank, and the Islamic Development Bank. The forum is Africa’s largest gathering of pan-African and global investors.
“Infrastructure is one of those areas where the forum has played a transformative role,” Anohu said.
This year’s edition is scheduled for 11-13 November in Sandton, Johannesburg.
The Africa Investment Forum addresses some of the greatest hurdles to attracting infrastructure investment to the continent. It does so by matching investors and public infrastructure projects, and offering de-risking tools, designed by the Bank and other development partners, in order to offer investors a safety net. It also advocates for regulatory reforms.
Africa requires between $130 and $170 billion a year2 to make up for its infrastructure gap. With that in mind, the forum has devised a Secondary Infrastructure Market – crowding in institutional investors to finance infrastructure, and develop it into an asset class in the continent.
Infrastructure was one of the nine sectors that attracted substantial investor interest at the 2018 Africa Investment Forum. The results have been promising, proving that the Africa Investment Forum is on course to become the continent’s premier investment marketplace.
The Private Sector Investment Operations team have developed novel tools and processes to facilitate deal making at the boardroom sessions at the conference, such as post-boardroom (deal tracker) activities. The deal tracker process is a pioneering structured mechanism designed to accelerate investors’ commitments, and advance projects towards financial close.
In short, the Africa Investment Forum offers a platform to attract private sector finance to the continent, just like a precious landing strip where planes can touch down safely.