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Continental initiatives drive Africa’s infrastructure growth
Continental initiatives are driving the new growth in infrastructure demand in Africa. This was the message conveyed to donor partners at the 23rd Oversight Committee (OC or Board) Meeting of the NEPAD Infrastructure Project Preparation Facility (NEPAD-IPPF), a multi-donor Special Fund hosted by the African Development Bank (AfDB). Presenting the new NEPAD-IPPF Strategic Business Plan (SBP) for the five-year period 2016-2020 to members of the OC, who included representatives from Canada, Germany, the United Kingdom as well as the African Development Bank (AfDB), Shem Simuyemba, the new Manager for NEPAD-IPPF, informed the Forum that there were at least four continental initiatives driving the growth of infrastructure in Africa.
The first was clear continental priorities through the approval of the Programme for Infrastructure Development in Africa (PIDA) by African Heads of State and Government in January 2012 as a strategic framework and blueprint for integrating and interconnecting Africa through regional infrastructure projects which had set clear priorities for the continent. PIDA has an investment portfolio of US $68 billion to be realized by 2020. This is in addition to the demand for project preparation arising from Regional Infrastructure Masterplans driven by the regional economic communities (RECs) and power pools as energy was currently one of Africa’s highest infrastructure priorities.
The second was deepening and maturing regional integration arrangements and the emergence of larger economic blocks such as the 26 country Grand Free Trade Area (G-FTA) involving three regional economic communities (RECs): the Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (COMESA) and the East African Community (EAC) and, ultimately, the Africa-wide Continental Free Trade Area (CFTA), which translate into increased trade and investment requiring matching infrastructure capacities and efficiencies to support emerging regional and global value chains.
The third was the new High 5 Agenda championed by the AfDB’s new President, Akinwumi Adesina comprising, five pillars – “Light up Africa”; “Feed Africa”; “Industrialize Africa”; “Integrate Africa”; and “Improve the quality of life of Africans” – as aligned to the Sustainable Development Goals (SDGs). Translating the ambitious High 5 Agenda into implementation will require enhanced capacities to identify, prepare and develop bankable projects, which can attract financing leading to implementation to achieve the desired development outcomes.
The fourth was growing appetite by the private sector to finance infrastructure in Africa requiring well-prepared projects which meet the financing criteria of both global and African financiers through public-private partnerships (PPPs) or direct financing by private sector investors and equity funds.
Simuyemba informed the Oversight Committee meeting that the “missing bridge” between these continental initiatives on the one hand and available financing on the other, was the lack of well-prepared bankable projects which are investment-ready and can attract financing. This is the gap that project preparation facilities such as NEPAD-IPPF were meant to fill to ensure availability of a pipeline of viable infrastructure projects as a means of increasing the stock of Africa’s infrastructure to respond to the demands of an integrated and prosperous Africa as envisaged by the African Union’s Agenda 2063.