RMB Africa23 May 2024 | 11:55

Partnerships in boosting African growth

Public-private partnerships will be crucial for addressing Africa's significant infrastructure financing needs.

Partnerships in boosting African growth

Africa faces a major infrastructure financing gap that is hindering development efforts across the continent.

Estimates from the African Development Bank indicate a funding shortfall of $70 billion to $100 billion annually that is needed to meet infrastructure needs.

Public-private partnerships (PPPs) are seen as central to bridging this gap through innovative models that leverage private sector resources. 

Crystal Orderson chats with Bongani Bingwa about Africa's infrastructure financing gap and how public-private partnerships can play a crucial role in addressing this challenge. 

"Public-private partnerships allow government to retain ownership while actually contracting the private sector to perform specific functions, such as maintaining operating infrastructure," noted Orderson. 

Kenya's recent call for a PPP to redevelop its ageing international convention centre was cited as an example of the model in action. President Uhuru Kenyatta announced that maintenance costs and upgrading work required outside support.

The newly established African Continental Free Trade Area (AfCFTA) may also have an important role to play in stimulating more PPP activity.

"The AfCFTA, if given the support, can unlock infrastructure and also get more public-private partnerships rolling to deal with these issues," Orderson stated. 

By connecting over 1.4 billion consumers and unlocking an estimated $3.5 trillion combined GDP, the trade pact could present significant economic opportunities.

However, Orderson cautioned that enabling infrastructure will be needed, making PPPs "essential to unlocking these economic opportunities presented by the free trade pact."

Africa Focus, presented by Crystal Orderson, is brought to you by RMB. To find out more about RMB’s focus on Africa’s Investment opportunities, visit the official RMB website.