High-speed rail has made significant inroads across the continent. A 300km line between Tangier and Casablanca was inaugurated in Morocco in November 2018 and the journey now takes two hours instead of six, with only a moderate increase in ticket price.
Since 2016, the 200km journey from Abuja to Kaduna in Northern Nigeria can be completed in one hour. Other routes are now being planned for example between Kaduna and Kano or Kano and Lagos. While economic gains are expected, social and political impact will also be visible. Via these infrastructure developments, inequalities between northern regions that have historically been perceived as neglected and oil-rich southern areas will be reduced.
The Gautrain, which was launched in 2010 between Johannesburg International Airport and Pretoria is another example of dynamism in that sector. This high-speed line, which raised some controversy at its announcement now carries 100 000 passengers a day. It has strongly reduced daily traffic jams in Gauteng province, the industrial heart of South Africa.
Africa’s economic integration depends first and foremost on its transport infrastructure, which is still influenced by the planning policies of the colonial era. There are too few highways between countries and too few trains, out of Africa’s 90,000 km of rail network, to cross borders. The network linking Uganda to Tanzania, Ethiopia to Djibouti or South Africa to Zimbabwe remains the exception rather than the rule.
Entering the 21st century, railway use remains focused on the transport of goods and raw materials between the coast and the hinterland as was the case decades ago. This situation must change, so that Africa can finally trade internally on a larger scale. The African Integrated High Speed Railway Network, one of the flagship projects of the African Union’s Agenda 2063, is one step in the right direction.
The modernisation and extension of rail networks will not be possible without the use of technologies, a key element of modern “intelligent” transport. Africa has already demonstrated a spectacular ability to “leapfrog” in the digital sector as proven by the number of mobile phone users and mobile banking customers. It could be the same in railways, where the continent would directly move on to the use of advanced technologies in transportation.
By Dr Ibrahim Mayaki, AUDA-NEPAD CEO
On October 16 2018, the authorities of the Democratic Republic of Congo announced the signing of an Inga 3 project exclusive development agreement with two consortia (Chinese and Spanish). This is a milestone for Africa. After eight years of studies and discussions, this hydroelectric dam project on the Congo River will finally enter its operational phase.
Inga 3 is a project designed to lead to an extra production of 11,000 megawatts (MW) of clean renewable, permanently available energy that will benefit the entire power grid in the region. The benefits of this project will be felt as far as in South Africa. The China Inga 3, a consortium including Chinese and European companies, plans to invest $14 billion. If all goes well, Inga 3 will be the largest hydroelectric project ever built on the continent. It will also showcase opportunities offered by public partnerships for infrastructure development in Africa, as well as regional integration.
Infrastructure deficit is one of the most serious problems our continent faces. It is most obvious in the energy sector – although 145 million people on the African continent have been able to connect to electricity since the beginning of the millennium, 645 million Africans are still deprived of it. How can we expect to start a virtuous circle of industrialization if the most basic prerequisite – access to affordable energy – is not fulfilled?
We estimate that the annual investment threshold for Africa’s infrastructure deficit is $120 billion. As of now, annual investment stands at about fifty billion only. The continent now devotes a little more than 4% of its GDP to infrastructure equipment. This is better than ten years ago when it dropped to 2%. But it is still less than in China, where this proportion is up to 14%. There are also major differences between countries and the structure of their economies, depending on their exposure to commodity prices in particular.
This lack of infrastructure carries big costs. When economies are isolated, they become less attractive, since unified markets on a regional scale are difficult to create. Inadequate infrastructure increases production costs, weighs on business’s competitiveness and negatively impacts foreign direct investment. Still, Africa must create 450 million jobs over the next twenty years to absorb its population growth. World Bank studies have shown that infrastructure deficit costs the continent two points of annual growth and generates a 40% shortfall in competitiveness gains for its enterprises.
Having stated the fact, we need to think about solutions. Be it in energy or communication corridors, the regional dimension is essential and must receive the greatest attention. Infrastructure covering several countries in the same region is more attractive to investors (both public and private) because it allows the pooling of costs and promotes integration. In 2012, the African Union set up an African Infrastructure Development Program (PIDA) managed jointly by the NEPAD Agency and the African Development Bank (AfDB). Its roadmap focuses on structuring cross-border projects, numbering 51, for a total package of $360 billion. They are the pivot of the continent’s real economic takeoff.
The approach chosen by PIDA is highly original in that it anchors the projects exclusively on Public Private Partnerships (PPP). Indeed, the real question is not whether to invest more, but rather, who should invest more? Again we say, ‘Africa must first rely on its own means and resources to carry out its development.’ But is this true in the infrastructure domain? The answer is ‘yes,’ but with some reservations. Investment in infrastructure is an absolute necessity, but it must not be to the detriment of other equally important programs such as investment in education, health or agriculture. Therefore, association with the private sector on the one hand, and international cooperation on the other hand, are credible alternatives to state funding. This is the solution that, as the NEPAD Agency, we never stop recommending, and this is the solution DRC authorities have chosen to adopt with the Inga 3 project.
Author: Dr Ibrahim Mayaki, CEO, NEPAD Planning and Coordination Agency