Business
Examining the opportunities to invest in Africa’s infrastructure
However, this expected growth will inflate the demand for infrastructure, which Simuyemba argues is already “one of the continent’s greatest impediments to sustainable development”.
If this growth is achieved, Africa’s infrastructure will need vital investment to meet the predicted 2040 demands in power, transport, water and the ICT sector. Simuyemba stresses that in order to unlock the continent’s infrastructure potential, leveraging private sector financing will be critical.
Power: The power demand in Africa in 2010 was 590 terawatt hours (TWh). It is estimated that by 2040 this demand will increase to over 3,100 TWh, which is almost an average growth rate of 6 percent per year. “To keep pace, installed power generation capacity must rise from present levels of 125 GW (comparable to the United Kingdom) to almost 700 GW in 2040,” noted Simuyemba.
According to PIDA, there are opportunities for investment in Africa’s energy in:
Hydro power plants such as the proposed Inga project in the Congo
Transmission lines and interconnectors
Oil pipelines
Gas pipelines
Transport: It is estimated that by 2040 transport volumes will increase by six to eight times the current amount, while some landlocked countries will see volumes increase by up to 14 times. In addition, port throughput is expected to rise to two billion tons in the year 2040, a huge growth from its 2009 levels of 265 million tons.
The following investment opportunities in transport infrastructure have been highlighted:
The Trans-Africa Highway (TAH) network
The transport corridors
The Africa hub port and railway projects
Water: The predicted water needs for the year 2040 will put some of Africa’s river basins under “immense ecological pressure”, according to Simuyemba. These include the Nile, Orange, Niger and Volta. To avoid this, Africa would need to invest in measures for sustainable water management, such as the development of multi-purpose dams and building the capacity of the continent’s lake and river basin organisations for the purpose of planning and managing hydraulic infrastructure. “The water-food-energy nexus is particularly critical in this respect,” added Simuyemba.
