Bringing Down the Barriers to Infrastructure Development in Africa
The imperative for leveraging Public-Private Partnerships (PPP) to meet the infrastructure development challenges in Africa is no longer a point of dispute. The African Development Bank estimates that Africa’s infrastructure funding gap has grown to reach USD 170 billion annually, and a recent report by the Global Infrastructure Hub (GIH) of the G20 emphasizes that African countries “do not have the resources to ramp up infrastructure spending on their own, even with backing from aid agencies and multilateral donor institutions, [making] private sector investment [essential]” (Bavier, 2018). As such, the focus has shifted to how PPPs can be most effectively integrated within the planning and implementation of infrastructure projects, with the objective of maximizing their contributions to sustainable economic growth and alleviating poverty.
The ingredients for ensuring the successful implementation of PPPs are widely recognized throughout the development and investment communities. The recently concluded Africa Investment Forum also highlighted the wealth of resources, which can be accessible under the right conditions, including from private equity funds and private institutional investors such as insurers, pension funds, and sovereign wealth funds.
Yet, the confluence of factors that are necessary to inspire, catalyze and grow the volume of PPPs across the African continent has thus far remained elusive, with a number of reasons underpinning why these transactions have failed to gain momentum.
