Trade and business growth requires more infrastructure in Africa

Going by the standards and records, it’s no doubt most of African countries are setting high standards on matters technology and wish to catch up with rest of the world in infrastructure development, including energy, road and rail transportation, and water investments to grow markets and revenues for economic development.

Infrastructure development is a key driver for growth across the African continent and a critical enabler for productivity, private sector integration, manufacturing and sustainable economic progress. 

Basing my humble view on the level of infrastructure in other leading content, this is one key area that contributes significantly to strategic development, poverty reduction and building employment and new markets.

Without good infrastructure, access to clean drinking water, food, health care, technological and communications systems, with greater focus on housing Infrastructure that provides the basis for making life tenable.

Governments and international partnerships across the continent, need to have keen agreements to the future and prepare for growth. 

Expansions and good investment in infrastructure is a key step to increase intra-Africa business and trade which has greatest potential in the continent both for people, goods, services and development of youth programs.

With the expected ballooning population, governments should strive to up the infrastructures using late green technology, to spur the economic growth and create entrepreneurial opportunities.

The international ports, airports and linking of markets, tourism investor enablers should be integrated with infrastructure inter connecting African countries will support regional integration.

While priorities are son lowering cost of living and creating new jobs, there is need to inter-connect trade to a more developed world and demand for innovative product and services continue to grow.

Infrastructure gap

The African Union (AU) also works to implement Agenda 2063 continental frameworks for promoting infrastructure development such as The Programme for Infrastructure Development in Africa (PIDA) which provides a common framework for African stakeholders to build the infrastructure necessary for more integrated transport, energy, ICT and trans-boundary water networks to boost trade, spark growth and create jobs.

Closing this infrastructure gap matters greatly for the continent’s economic development, for the quality of life of its people, and for the growth of its business sector.

Infrastructure investment in Africa has been increasing steadily over the past few years, and that international investors have both the appetite and the funds to spend much more across the continent. 

The challenge, however, is that Africa’s track record in moving projects to financial close is not good: most of infrastructure projects fail at the feasibility and business-plan stage. 

Globally, World Bank says about 840 million people live more than two kilometers from all-weather roads, one billion people lack electricity, and four billion people lack internet access.

It is estimated that nearly 600 million people in sub-Saharan Africa lack access to grid electricity —accounting for over two-thirds of the global population without power. 

The question governments should be asking then is: what are the prospects of unlocking such a step-change in infrastructure investment? More and better answers are needed to make Africa what it should be on matters infrastructure. 

Available data indicates that Africa’s current pipeline of infrastructure projects includes 2.5 trillion dollars’ worth of projects estimated to be completed by 2025, across all asset classes. Not all of these projects will eventually succeed, as over 50 per cent of them are still in feasibility stages. 

“Public funds will not be sufficient in these challenging times. We have to look for additional capital from development partners, the private sector and institutional investors.”

These are the words Chair of the Africa 50 board and CEO of AfDB Akinwumi Adesina. 

Infrastructure projects

Statistics show that despite an uptick in financing from the African Development Bank (AfDB), the continent still requires between 68 billion to 108 billion dollars every year build better infrastructure.

The World Bank estimates that for Africa to achieve universal connectivity by 2030, an investment of 100 billion dollars is required. 

African governments must actively seek out private sector investment in infrastructure projects. This can lead to a growing number of infrastructure investors in Africa, including both domestic and foreign investors. 

Investors will be attracted to the continent’s high growth potential, as well as the relatively high returns that can be earned on infrastructure investments.

One of the key advantages of private sector investment in infrastructure is that it can help to mobilize additional resources and bring in new technologies and management practices. This can help to accelerate the pace of infrastructure development and improve the quality of the infrastructure that is built. 

Additionally, private sector investment can help to reduce the burden on government budgets, which are often stretched thin.

In conclusion, infrastructure investors in Africa play a crucial role in addressing the continent’s infrastructure deficit and promoting economic growth.

Private and public partnerships remain an important strategy to grow business and trade to stimulate opportunities for the youth and increases exports and earnings for the Africa nations.