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CONVERGENCE OF REGIONAL INFRASTRUCTURE PLANS BODE WELL FOR BUSINESSES EXPANDING INTO AFRICA

The world is looking to Africa as its next investment and growth frontier, but in order to secure growth, Africa needs infrastructure that can support business development across the continent. If regional integration in infrastructure projects is not prioritised, Africa will lose out at this critical time that the world is looking for alternative investment destinations.

It’s no secret that Africa’s lack of infrastructure has hamstrung its economic competitiveness. According to the World Bank, the cost of addressing Africa’s infrastructure needs is around $93billion a year. In its synthesis study, the Programme for Infrastructure Development in Africa (PIDA), a joint initiative between the African Union Commission, the New Partnership for Africa’s Development Planning and Coordination Agency, and the African Development Bank, states: “Deficient infrastructure in today’s Africa has been found to sap growth by as much as 2% a year (Calderón 2008). This is a continental problem that requires a continental solution.”

There are positive signs that regional integration between African countries on infrastructure projects will bring about the necessary ‘continental solution’ according to Roelof van Tonder, of the Built Environment Professions Export Council (BEPEC). BEPEC is a Public Private Partnership with the South African Department of Trade and Industry. “What we’re seeing is a convergence of South African government policy interlinking with African initiatives such as the Programme for Infrastructure Development in Africa (PIDA), which is something that we haven’t seen to date,” says van Tonder.

“The President has created the Presidential Infrastructure Coordinating Commission, which sets out how government would like to participate in mutually beneficial infrastructure projects to unlock long-term socio-economic benefits by partnering with fast-growing African economies with projected growths between 3 and 10%.”  

The South African government has set aside R850-billion allocated to infrastructure investment over the next two years, marking a departure from its emphasis on social services spending to economic growth and employment. Both President Zuma and Finance Minister Gordhan have spoken of the need for additional infrastructure funding, particularly in water, power and transportation, and that much scope exists for private participation and investment to overcome the estimated R1,5-trillion infrastructure backlog.

Africa has been waiting for South Africa to join in regional infrastructure efforts, as it can’t increase regional competitiveness without the continent’s economic powerhouse. Van Tonder believes that South African companies need to realise the unique opportunities available to them. He explains, “I think that businesses in South Africa have generally, not fully caught onto this across all our sectors. We obviously have companies such as Shoprite Checkers and our cellphone providers who are heavily invested in Africa, but there’s a next wave of companies that should integrate their business models and their involvement in Africa, because the demand for our services as an African country will be there.”

The upcoming Infrastructure Africa Business Forum, hosted by the NEPAD Business Foundation (NBF) in partnership with Siyenza Management, will tackle the issue of regional integration specifically, along with other blockages and opportunities in the infrastructure sector.

Lynette Chen, CEO of the NBF says of the conference, “If Africa is to develop further and to a level matched with its needs socio-economically, infrastructure build is the key to unlocking the potential in sectors where Africa possesses unique advantages. Growth in our agriculture, resources and manufacturing sectors can come from improved intra-African trade, which is currently impeded by poor overall infrastructure. This conference is therefore crucial in that it allows stakeholders to not only discuss challenges while proposing resolutions; it links the right partners that can make infrastructure financing and implementation smoother. In this regard, we are pleased to partner with Siyenza to deliver this conference”.

The annual event is taking place on the 10th and 11th July 2012 at the Sandton Convention Centre in Johannesburg, South Africa. It will bring together Africa’s most senior business leaders, policy makers, regulators and media to advance debate and champion delivery of Africa’s critical infrastructure requirements, while providing expert advice on the current state of infrastructure and the anticipated impact of future development.

“The programme for the conference will allow business to get a lot more insight into how they should structure their business development activities, definitely for the medium- and long-term but even for the short-term,” van Tonder concludes.
Ends
29 March 2012
Prepared by: Julie Cunningham
011 463 9184
On behalf of: Infrastructure Africa Business Forum
About Infrastructure Africa Business Forum
The annual Infrastructure Africa Business Forum will take place at the Sandton Convention Centre in Johannesburg from 10-11 July 2012 and will present stakeholders with an opportunity to unpack the enormous growth potential in addressing Africa's infrastructure needs. Africa, with a population exceeding 1 billion people is well placed as an emerging market, keen for investment & growth and has successfully maintained an average growth rate of 4% for the past few years as a continent.

The 2 day business forum will bring together business to explore new trading opportunities, establish new business networks, develop and form partnerships and plan a way forward to address some of the continent's requirements.
For more information please visit: http://www.infrastructure-africa.com/
 


 
 
 
 
 
 
 
 
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