A need to develop ‘soft infrastructure’

AFRICA is selling itself short because it is not investing enough in “softer infrastructure” and there are not enough bankable projects to assist the continent in meeting requirements.

This was the consensus of panel members discussing the “Africa Agenda 2063” at the first day of the Infrastructure Africa Business Investment Forum in Johannesburg.

Brigette Baillie, partner in the project development and finance sector at global law firm Herbert Smith Freehills, said the figure for the “sexy infrastructure” that needed to be developed in Africa as a whole – such as roads, rail, ports and hydro-power facilities – was growing every year and leaving a huge gap between it and the softer infrastructure.

“What we are not focusing on are those softer infrastructure and the utility infrastructure: sewage, water, schools, reticulation of electricity, and that is a huge gap in the African infrastructure story,” Baillie said.

“There is money available but there are not enough bankable projects. There are too many projects with big funding gaps in them.”

Stanley Subramoney, chief executive at black-owned investment firm Menston Holdings, agreed and said that these challenges were making it expensive to do business in Africa.

Subramoney said that the CEO-Initiative had agreed a few weeks ago that infrastructure development was one of the ways of getting South Africa’s growth path going, but said it was worrying that a number of infrastructure projects were not at commencement stages.

The two-day gathering brings together business, government and other partners to explore new trading opportunities, and discuss how to build the infrastructure the continent needs. It is estimated Africa will have to spend $93 billion (R1.4 trillion) a year for a decade to meet demand. |