There are a lot of challenges involved in delivering infrastructure projects in Africa, but the continent also presents opportunities for both investors and professionals involved in the delivery of infrastructure projects.
Here are top 7 facts about African Infrastructure:
1. African Economies attract 40% less infrastructure investment
The total infrastructure investment forecast for Africa until 2040 is projected to be $4.3 trillion, or $174 billion per year. But if African economies could raise their performance to match that of their best-performing peers, the total investment need would be $6.0 trillion, or $240 billion per year—a difference of almost 40%.
2. Africa has been the 2nd fastest growing continent in the last decade
Sub Saharan Africa has been the second fastest growing continent in the world for over the past ten years, with average annual growth of 5.1 percent in the past decade.
3. 80% of Mega Projects in Africa do not move to execution
Approximately only 20% of projects (from inception) in Africa reach financial closure and can move to execution.
4. Infrastructure Projects in Africa can generate high returns
International private capital —especially foreign direct investment— has much to gain by broadening its stake in African infrastructure. Successful projects are likely to generate a higher return on investment than similar projects in other regions.
5. Infrastructure investment gap in Africa is estimated at $100 billion
Estimates of Sub-Saharan Africa’s annual infrastructure gap put it at around $100 billion. Every dollar of that gap represents a drag on Africa’s development and a diminution of its potential. After the acquisition of modern transport systems, power generation capacity, and other necessary infrastructure, it will lag not only the developed world but other emerging regions as well.
6. Annual national public spending on infrastructure is exceedingly low:
Africa is urbanising more rapidly than any other part of the planet. Africa’s 1.1 billion citizens will likely double in number by 2050, and more than 80% of that increase will occur in cities, especially in slums. The continent is not prepared for this urban explosion because Africa is suffering from a significant urban infrastructure gap. Annual national public spending on infrastructure is exceedingly low: an average of 2% of GDP in 2009-2015, compared to 5.2% in India and 8.8% in China.
7. Africa is underprepared for the impending disruption to jobs
Africa is far removed from making optimal use of its human capital potential and under-prepared for the impending disruption to jobs and skills brought about by the Fourth Industrial Revolution.
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