African leaders agree major infrastructure programme

Infrastructure, Development, PIDA, New Partnership for African Development, African Union, African Development BankAfrican Heads of State have endorsed the launch of the Programme for Infrastructure Development in Africa.African Heads of State have endorsed the launch of the Programme for Infrastructure Development in Africa (PIDA), a multi-billion dollar initiative that will run through to 2040

In a statement at their 18th summit held in the Ethiopian capital, Addis Ababa, the Heads of State approved the implementation of the recommendations in the study on PIDA presented to the summit. The study was a joint initiative of the African Union, the African Development Bank and the New Partnership for African Development (NEPAD) Planning and Coordination Agency. Endorsement by the AU summit will now be followed by more detailed planning on the actual implementation of PIDA.

PIDA’s main goal is to accelerate the delivery of Africa’s current and future regional and continental infrastructure projects in transport, energy, information and telecommunications technologies, as well as trans-boundary waterways. Its projects are designed to support Africa’s regional and continental integration. PIDA’s longer term goal is to enhance the physical integration of Africa, boost intra-African trade, and raise African competitiveness in the global economy.

PIDA sets out short-term goals to be achieved by 2020, medium-term goals to be achieved by 2030, and the long term ones by 2040. It is based on expert projections that African countries will grow by an average of six per cent a year until 2040, driven by a surging population, increasing levels of education and technology absorption. This implies that, over 30 years, the GDP of African countries will multiply six-fold. This continuing growth and prosperity will swell the demand for infrastructure.

In the shorter term, PIDA will focus on its Priority Action Plan. This dwells on fifty one regional and continental infrastructure projects to be implemented by 2020. These projects are designed to meet Africa’s more immediate regional and continental infrastructure needs.

PIDA is also expected to play a critical role in reducing Africa’s infrastructure deficit. The continent’s infrastructure remains the least developed in the world. It is estimated that poor infrastructure alone saps the Africa of two per cent in economic growth every year.

Because of poor transport networks, especially for landlocked countries, transport costs in Africa are among the highest in the world. This hampers not only intra-regional trade but also the continent’s ability to compete in the international markets. Both are critical to Africa’s growth. This poor infrastructure also has a negative impact on possible inflows of Foreign Direct Investment. Further, only 30 per cent of the African population has access to electricity, compared to 70 to 90 per cent in other parts of the developing world. Only 18 per cent of the continent’s irrigation potential is exploited, yet many countries on the continent are net food importers.

Africa has a telecommunications penetration rate of a meagre 6 per cent. This compares to an average of 40 per cent for other geographical zones. Rail coverage is sparse and sometimes non-existent. African ports are also often uncompetitive while inland waterways are hardly exploited for trade and travel.

Speaking at the African Union summit, Aboubakari Baba Moussa, the African Union Commission’s director of infrastructure and energy, said PIDA had been developed through consultation and consensus designed to galvanise all stakeholders, including African states and their regional economic communities.

“This consensus, clarity of purpose and clear roadmap on the way ahead, are a critical foundation for joint action and success,” Moussa said. “We have full confidence the programme will attain its goals. The timing of this launch is also most appropriate. There is now a global awareness of the need to close Africa’s infrastructure gap, if the continent is to make significant headway.”

Alex Rugamba, the African Development Bank’s director for NEPAD, regional integration and trade, said PIDA’s goals were ambitious but attainable. He said the programme would also yield unprecedented benefits.

“Some of benefits we foresee include a doubling of intra-African trade from the current levels of 11 to 12 per cent. PIDA will also increase Africa’s share of world trade by at least twice today’s share of 2 per cent,” Rugamba said. “We also foresee the creation of up to 15mn new jobs from the construction, operation and maintenance of PIDA projects. Many more millions of jobs will also be created indirectly through the increased economic activity that will result from PIDA projects.”

Rugamba stressed that PIDA and the African Development Bank were in no doubt about the critical role PIDA will play in Africa’s economic development.

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