Roads, rail and more – Africa needs it all!

Africa needs to deliver much-needed roads, rail, ports, airports, power grids and IT systems if it wants to support its fast-growing population. According to Celeste Fauconnier, senior economist at Rand Merchant Bank, the lack of infrastructure remains the biggest stumbling block on the

continent despite the significant strides that have been made since the early 2000s. “The shortage is still stark and is obstructing African economies from diversifying and realising their potential growth.” More importantly, it came at a cost, she said in Cape Town recently.

According to the World Bank, the lack of sufficiently developed infrastructure shaves up to 2.6% off Africa’s average per-capita growth rate and places significant strain on human development overall. This, however, presented an overwhelming opportunity for those businesses involved in the development or financing of infrastructure projects, Fauconnier said. “The African Development Bank’s (AfDB) most recent estimation of infrastructure needs was

between $130bn and $170bn annually, but the continent’s available capital is insufficient to achieve this.” Only a fraction of the estimate is currently being spent on the continent at around $45bn per year. Commenting on whether it was just a matter of financing, Fauconnier said weak legal, regulatory and institutional frameworks along with weak planning and project preparation continued to impact on infrastructure delivery as did ineffective governance and corruption. The AfDB’s most recent estimation of infrastructure needs was between $130bn and $170bn annually. – Celeste Fauconnier