Tuesday, 23 July 2013
Africa’s institutions chart the way forward to finance Africa’s infrastructure
Tunis, 22 July 2013 (ECA) - At the Roundtable on Financing Africa’s infrastructure held on 19th July, the Executive Secretary of the Economic Commission for Africa, Mr. Carlos Lopes, alongside the heads of the African Development Bank and the African Union Commission agreed that “a rising Africa will require adequate infrastructure as a key catalyst for the continent’s transformation agenda, industrial development and intra-African trade.”
Speaking at the Roundtable, Mr. Lopes said, “We have to step back, critically examine, and have a good understanding of the different elements of the bankability of Africa’s mega infrastructure projects.” This, he stressed, was essential to address, the often unwarranted, negative perception of Africa and to improve the continent’s brand as a destination for investment.
The Executive Secretary highlighted several factors that reduce the attractiveness of Africa’s regional infrastructure projects to investors, including: the requirement of long term finance and stability; the complexity of managing large scale infrastructure projects; perceived lack of guarantee and return on investment, and the necessity for effective coordination among the relevant agencies and organisations in the different countries involved in cross-border infrastructure projects. He said that domestic resource mobilisation is a viable solution to the slow pace of implementation of cross-border infrastructure projects in Africa.
Mr. Lopes further argued that, although much remains to be done, in the last decades significant progress has been made in many areas, including peace and security and the development of continental programmes across sectors, including infrastructure (Programme for Infrastructure Development in Africa - PIDA), agriculture (Comprehensive Africa Agriculture Development Programme - CAADP), and trade (Continental Free Trade Area -CFTA), among others.
“Africa should weave the various initiatives together into a coherent whole,” he said, and added that in order to ensure ownership within the continent, Africa needs to set its own objectives as well as concrete development goals, anchored on existing development frameworks, such as industrialisation, towards which the continent has to define its own path. He noted that industrialisation in general and commodity-based industrialisation in particular is a viable option for countries endowed with natural resources.
In addition he urged the Roundtable to prioritise the development of quality human capacity and stressed the need for the continent to align its educational system with market demands.
“To address some of these challenges, the Africa50Fund could be one of the different blocks required to achieve Agenda 2063, which is the Africa Union’s vision for the next 50 years,” he said.
The meeting issued a Communique as a show of commitment by the key African institutions to implement the mandate from Heads of State and Government for the development of the Africa Agenda 2063, as a transformation vision for Africa over the next fifty years. The meeting further strongly supported the articulation of African Development Goals and the need to build on existing development frameworks and knowledge base; and endorsed the Africa50 Fund as proposed by the African Development Bank (AfDB). The meeting noted its viability as a vehicle for mobilisation of private capital, and Africa’s own savings to finance transformational bankable projects.
Also present at the Roundtable were Dr. Nkosazana Dlamini Zuma, Chairperson of African Union Commission (AUC) and Dr. Donald Kaberuka, President of the African Development Bank Group as well as heads of Regional Economic Communities (RECs) and sub-regional financial institutions.