New report highlights $1trn infrastructure investment deficit in 10 African countries
Several African nations are facing a shortfall in funding for infrastructure projects, according to research by the Global Infrastructure Hub.
The report, Global Infrastructure Outlook: Infrastructure Investment Need in the Compact with Africa Countries, says that $2.4trn is needed in 10 countries by 2040 if they are to keep pace with economic growth.
However, only $1.4trn is forecast to be delivered and $415mn of the $1trn deficit is required by 2030 in order to for the 10 Compact with Africa countries to hit UN Sustainable Development Goals.
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The countries in question are Morocco, Tunisia, Egypt, Ethiopia, Senegal, Guinea, Côte d’Ivoire, Ghana, Benin and Rwanda.
However, the report does highlight a trend for increased investment into emerging markets.
Global Infrastructure Hub CEO Chris Heathcote commented: “It’s now more important than ever that emerging markets continue to develop their infrastructure project pipelines, as well as continuing a track record of attracting public and private capital into well-identified, selected and prioritised projects.
“As the investment environment in these 10 countries improves, there is a real opportunity for infrastructure investors to deliver impactful projects; providing access to essential services – roads and rail, airports and seaports, telecommunications, drinking water, sanitation and energy – for a large proportion of the population.”
Of all the regions studied by the Global Infrastructure Hub, Africa showed the greatest deficit in projected investment, the $1trn figure representing a 42% shortfall.
France to invest €1.8bn in Egypt’s infrastructure
France will invest a total of €1.8bn into Egypt’s infrastructure focusing specifically on upgrading the Cairo Metro, building a railway to Sudan, and developing water and energy schemes. Officials have called the investment a “major boost to bilateral cooperation”.
The Cairo Metro
Included in the financing is a concessional government loan of around €800mn to upgrade Line 1 of the Cairo Metro, introduced in the 1980s. The financing will pay for 55 trainsets for the line and is provided by the French engineering company, Alstom.
Line 6 is also due to be upgraded using further state-guaranteed loans worth up to €2bn. Bruno Le Maire said that this would be negotiated over the next six months. France and Egypt have worked in close cooperation ever since Abdel Fattah al-Sisi became president in 2014, despite differences over human rights and strong criticism of Egypt by rights activists and some foreign states.
Nine more projects over the next half a decade
A further €1bn from France’s development agency, Agence Française de Développement (AFD), aims to cover a range of other projects over the next half a decade.
These projects include a railway line between Aswan, southern Egypt, and Wadi Halfa in Sudan, as well as several projects in the renewable energy and water purification industries. Bruno Le Maire, France’s Finance Minister, said Egypt was a “strategic partner and commercial dealings with it would be developed. France will substantially increase its direct exposure to Egypt, becoming the first counter-party for government to government loans,” he said.
According to Le Maire, the AFD will also €150mn to support the construction of a universal health insurance programme. French contractors such as Vinci and Bouygues have a long history of working on the Egyptian capital’s underground system.
Talking about the relationship between France And Egypt, Le Maire concluded: “France will substantially increase its direct exposure to Egypt, becoming the first counter-party for government to government loans”.