From your point of view, what else could be done to leverage the infrastructure’s development and sustainability needs in Africa?

The key to building a well-targeted infrastructure that connects African economies to global value chains is “governments dedicated to the task”.  Governments that have implemented successful infrastructure projects in the region should collaborate and share more “lessons learned” with each other.

Simply, the following is needed to drive infrastructure development:

  • a detailed infrastructure investment plan;
  • clear regulatory framework initiate policy and regulatory reforms; and possibly revising the public sector infrastructure institutional framework
  • rethinking the infrastructure sector financing space;
  • creation of technical and financial capacity in the implementing entities within government and private sector.

 

What can we learn from the global pandemic’s impact on PPP’s in Africa? What are the new challenges and opportunities, that have come to light during this time?

All governments on the continent will be looking at infrastructure to stimulate the economy and drive employment post-COVID and lockdown. Governments have already started to significantly invest in social infrastructures such as water sanitation and healthcare due to the virus.  Social inequalities have been highlighted through the pandemic with Governments being criticized for not doing enough.  It has been inspiring to see some large commercial entities doing their part and contributing to social infrastructure as well.

It will be up to Governments to spearhead infrastructure investment and development going forward. A key question becomes how will Governments determine which projects to prioritise -projects for the greater social good may not be the same as projects with superior multiplier effect and ability to attract foreign investment.  These objectives may be seen to compete – and what should the deciding factor be – in my view it should be job creation.

Another major theme that has come to the fore during the pandemic is to highlight the urgent need for greater digital connectivity for rural communities – both for access to education and for participation in the global economy.  The move to working from home for most people has emphasized how access to telecommunications infrastructure can be absolutely vital to the livelihood and can go some way to bridging the economic divide for the next generation.

Funding for the projects is always a challenge with blended finance options becoming more relevant.  Funding capacity is shifting from traditional debt providers to private equity funds of international investors.  New funding opportunities are also emerging with the development of domestic capital markets and the opening of sovereign funds dedicated to infrastructure development.

 

How do you see the development and sustainability for PPPs in Africa? What are the current priorities?

It appears that the energy and transport sectors will be prioritized due to the nature of the technical and commercial risks, with a focus on the financing and structuring of the projects.  Soft infrastructure (such as education or health services), although key when it comes to the quality of economic or inclusive growth, will be developed at a slower pace.

Name Interview provided by: Alexandra Felekis and Mzukisi Kota
Position Partner – Projects Practice and Head of Infrastructure and Transport Sector Group, Webber Wentzel, South Africa // Partner – Public Law and Deputy Head of Energy Sector
Event Africa PPP 2020

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