Mr Chidi Izuwah, Acting Director-General, Infrastructure Concession Regulatory Commission (ICRC), has suggested massive adoption of the Public Private Partnerships (PPP) delivery model to accelerate infrastructure delivery in Africa.
Izuwah made the suggestion in a paper titled: “Infrastructure and Africa’s Development and Prosperity– the PPP Imperative,’’ made available to the in Lagos .
“Lack of modern infrastructure is a major challenge to our continent’s economic development and indeed constitutes a major impediment to the achievement of the UN Sustainable Development Goals (SDGs) and revitalisation of agriculture.”’
“We must embrace this challenge and rise to the occasion of Africa being infrastructure sufficient in the next 10 years,’’ Izuwah said.
He mentioned that India, Philippines, South Africa, Malaysia and many developed countries had accelerated their infrastructure provisions through the PPPs.
According to him, investment in agriculture to improve productivity, create jobs and provide food security is futile if there are no processing plants to add value.
“No effective transportation and cold chain infrastructure to facilitate the supply chain that will get the produce (cocoa beans) and finished products (chocolate) to market and consumers.”
“The economic consequences and impact of the above situation, is very well explained by the President of the African Development Bank, Akinwumi Adesina.
“Africa produces 75 per cent of the world’s cocoa, but receives only three per cent of the $100 billion (N35,000,000, 000, 000) a year revenue in the global market for chocolate,’’ the engineer said.
Izuwah said that due to lack of appropriate value chain infrastructure, Africa exported raw materials.
“As we all know, the price of cocoa may decline, but never the price of chocolates.”
“The price of cotton may fall, but never the price of clothes and garments. While coffee farmers face declining prices, coffee grinders and starbucks smile all the way to the banks.
“Furthermore, due to lack of appropriate value chain infrastructure, the Africa Development Bank again tells us that Africa currently imports about 35 billion dollars worth of foods annually, expected to rise to 110 billion dollars by 2025.”
“If the current trend continues, imagine what 35 billion dollars will do if only we in Africa could feed ourselves.”
“The 35 billion dollars is enough to electrify all of Africa and the 110 billion dollars potential future savings in food imports is enough to close Africa’s whole infrastructure deficit,’’ he said.
Izuwah said, “Africa’s infrastructure needs are enormous; from rural roads, to railways and harbours to irrigation systems, ICT, clean water, sanitation, energy and basic social infrastructure such as health, education, banking and commercial services.’’
“It is painful to recall that indeed millions of our fellow Africans lacked even the most basic of these fundamental infrastructure amenities.
“The actual infrastructural gaps are indeed deeply worrisome, as estimated by the African Infrastructure Country Diagnostic report.
“Less than a third of sub-Saharan Africans have electricity; only 56 per cent have access to clean drinking water; barely a third of our rural Africans live near an all season road; while about 4 per cent of our farmlands are irrigated.
“Over 60 per cent of our continent’s population lack basic sanitation facilities; we have less than a quarter of paved roads per kilometer, when compared to other developing regions.
“Our infrastructure gap, as outlined above, is a major opportunity to transform and do well for our continents’ citizens,’’ the engineer said.
He described Africa as rich in natural resources and having a large young ambitious and entrepreneurial population.
According to him, if harnessed properly, these factor endowments and advantages could usher in a period of sustained economic growth and increased well-being for all Africans.
“It is evident that the absence of robust infrastructure will therefore hamper the much-needed efficient and effective economic activities to enhance growth, wealth and job creation and overall national development in Africa.
“Some of the benefits of PPPs for African governments and taxpayers include: improved service delivery, improved cost-effectiveness and increased investment in public infrastructure.
“Other benefits are reducing public sector risks, improved budget certainty and making better use of assets,’’ he said.
Izuwah said that the PPPs helped the public sector to develop a more disciplined and commercial approach to infrastructure development, while allowing them to retain strategic control of the overall project and service.
“PPPs give the private sector access to secure, long-term investment opportunities.
“Private sector partners can profit from PPPs by achieving efficiency, based on their managerial, technical, financial and innovation capabilities.
“To drive the PPP imperative, African governments must have the strong political will and support; a steady pipeline of well-structured economic and social infrastructure projects, and an efficient, transparent and standardised PPP procurement processes,’’ he said.