AfDB urges stronger emphasis on infrastructure by regional governments

Date: Monday, October 6, 2014
Africa invests only 4% of its collective GDP in infrastructure, compared to China’s 14%.

Speaking at the 9th African Development Forum (ADF) in Marrakech, African Development Bank Group (AfDB) Operations Vice-President in charge of Agriculture, Human Development and Governance, Aly Abou-Sabaa, said that many countries in the region were hungry for infrastructure investments, and now was the best time for African governments and their development partners to focus on fast-tracking resources.

Abou-Sabaa said that infrastructure is vital to transformation, but added that “other sectors are central, including agriculture, good governance, health, education systems. “Africa’s transformation cannot occur with weak governance, health or education systems or within a context of prevailing food insecurity,” he said. He also addressed various unforeseeable crises prevailing in the region, including HIV-AIDS, malaria and ebola. He explained that in spite of agriculture contributing up to 25% of Africa’s GDP and employing about 60% of the population, the continent still imports $25 billion worth of food every year. “The Bank is promoting participation of anchor investors in private sector investment in agriculture,” the vice-president stated.

Abou-Sabaa expounded on the Bank’s estimates, observing that “the annual financing need for African infrastructure is about $95 billion, of which only $45 billion is currently invested each year, from African governments, development finance institutions and the private sector.”

Building on these facts and figures, Abou-Sabaa argued that Africa’s transformation largely depends on how well countries mobilise inputs from a range of stakeholders, promote infrastructure through new vehicles such as the Africa50 Fund, invest in their human capital, and foster good governance to enable a business-conducive environment.

He also said the Bank has created Africa50 Fund, headquartered in Casablanca, as the new game-changing solution to stimulate and drive the African infrastructure market.

The Africa50 Fund, “seeks to reconcile governments’ strategic objectives of meeting the substantial investment needs in infrastructure and the attractiveness of African assets to the growing sources of domestic and international capital,” Abou-Sabaa said.

More importantly, the long-term strategic aim of Africa50 is to invest directly $10 billion in projects, and facilitate total project investments of $100 billion by crowding in private-sector players and enticing investors.

By Kingsley Alu
Article from www.leadership.ng
Source: http://leadership.ng/business/commerce-and-industry/394337/afdb-urges-st...