African countries must fast track Public Private Partnership (PPP) arrangement, since public financial sources alone cannot meet the funding needs, to overcome their current infrastructure deficit, according to a Director of Africa Agribusiness Knowledge Centres Inc, Elizabeth Uwaifo.
Ms. Uwaifo was quoted by the private Vanguard newspaper Wednesday as saying African countries should seek more strategies to increase private sector investment in infrastructure.
Speaking in a paper entitled, “Taking African Infrastructure to the Future”, Ms. Uwaifo said inadequate physical infrastructure covering transportation, power and communication is inhibiting growth and productivity on the continent.
She added that inadequate social infrastructure such as water supply, sanitation, sewage disposal, education and health are adversely affecting the quality of life.
“It is critical that African governments double efforts to provide a policy and regulatory environment that promotes investor confidence and facilitates the growth of the debt capital markets and alternative investment markets.
“In addition, international financial institutions should be engaged to facilitate private sector participation and investors and other transaction participants should consider employing structured solutions to enhance investment opportunities,” the financial expert said.
In a 2010 report, the World Bank found that the poor state of infrastructure in sub-Saharan Africa reduced national economic growth by two percentage points every year and cut business productivity by as much as 40%.
Also, the World Bank Africa Infrastructure Country Diagnostic (2009) said the infrastructure need of sub-Saharan Africa exceeds US$93 billion annually over the next 10 years.
The African Development Bank said less than half of this amount is being provided, which leaves a financing gap of more than US$50 billion per annum to fill.