Lomé, Togo, 14 March 2017 (ECA) – African governments and their partners should focus on developing hard infrastructure and support efforts of Ministers in Charge of Trade and Integration to realize a Continental Free Trade Area (CFTA) that encompasses rules for intra-African trade in goods and services, key among them energy, transport and logistics services.
This was said by Director Stephen Karingi of the Economic Commission for Africa’s Capacity Development Division in an address to the First Ordinary Session of the African Union Specialized Technical Committee (STC) on Transport, Transcontinental and Interregional Infrastructures, Energy and Tourism (TIIIET) that opened in Togo Monday.
“As we all know, the cost of transport and related logistics is a key element in being competitive. However, inadequate policies and infrastructure management are also key in making costs to be high,” Mr. Karingi told participants at the meeting.
He said most of Africa remains predominantly rural but the situation is changing rapidly. It is estimated that by 2035, at least 50 percent of Africa’s population will live in urban areas.
“Currently, the challenges of urbanization and the need for critical infrastructure is already evident,” said Mr. Karingi, “The imperative now is to give a singular focus on the task of building the priority infrastructure.”
He said the infrastructure landscape in Africa has been changing but not at a pace that would quickly spur the continent’s transformation. Estimates show that poor infrastructure is costing Africa between 2 to 3 percentage points of GDP growth every year.
Mr. Karingi said there was need for greater coordination through Regional Economic Communities if Africa is to realize the full benefits of infrastructure investments, adding the ECA will continue to work with the AUC and other partners on the continent to help develop its infrastructure.
He said it was of no use for the continent to develop infrastructure if the distribution of the associated services was constrained. For instance, the delivery of electricity services has been the biggest infrastructure challenge, limiting opportunities for businesses and industries to function effectively.
The ECA Global Tracking Framework (2017) shows access to electricity remains the biggest challenge in many African countries, threatening to derail and reverse the economic performance.
Mr. Karingi said logistics performance also needs to be addressed as a matter of urgency, particularly at Africa’s ports and their linked nodes, adding air transport costs, which are particularly important for tourism, business and high-value products, also need to be looked into.
“Opening access and eliminating ownership restrictions would increase the number of flights, reduce fares, and improve service,” said Mr. Karingi. He added it was heartening that domestic funding for infrastructure in Africa has increased dramatically to dwarfing funding from the ODA sector. African countries finance about 65 percent of their infrastructure expenditures which equates to $60 billion annually.
Over the years, the ECA has been in partnership with the AUC and other continental and Sub-regional bodies in furthering the African infrastructure agenda.
For his part, Mr. Cheikh Bedda, Director of Infrastructure and Energy at the AUC, said the theme for the first STC meeting; ‘Financing Infrastructure in Africa,’ takes into account the continent’s huge challenge to mobilize colossal financial resources required to improve infrastructure in Africa that will support its development aspirations under Agenda 2063.
“We are expected to make concrete proposals on means of financing infrastructure projects including mobilisation of investments for the preparation, structuring, implementation and risk mitigation of climate resilient infrastructure projects,” he said.
The Specialized Technical Committee on Transport, Energy and Tourism is meeting for the first time in the hope that cross sectoral inputs that will be shared during the week will enrich each sector’s contribution to the transformation of Africa’s economy.
It will analyze ways of increasing domestic and regional financial resources for funding regional transport, energy and tourism projects and adopt updated action plans for infrastructure programs and initiatives to be undertaken for the period 2016-2018 at regional and continental levels, among other issues.
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