On the Brink of Major Change

The world is eager to do business with Africa! This is amid growing recognition of the continent as the fastest growing economic hub that in turn translates into a plethora of opportunities for trade and commerce. But to achieve its full economic growth potential, Africa has to improve its infrastructure.

- Shreya Bhattacharya

Africa has more than one-quarter of the world’s arable land, eleven of its countries rank among the top ten sources for at least one major mineral and every potential hydrocarbon basin across East Africa is today a subject of immense curiosity. No wonder, for global business leaders, Africa is today’s most promising investment destination.

Although investors are keen to explore the continent’s burgeoning consumer market they find difficulty in getting access to it, especially in the interior, due to poor transport infrastructure. The deficit also leads to hike in transaction costs of business as import and export of goods, filling orders, and obtaining supplies become extremely difficult.Africa understands this really well and hence has identified infrastructure development as one of its key priorities.

While reliable transport infrastructure,like railways, roads and ports, is crucial and are being put in place, soft infrastructure like policy reforms, adaptive customs and relaxed border controls enabling trade programs are also getting due attention.

“There are encouraging signs of world-class infrastructure delivery in the continent. High-impact projects under way such as the Gautrain project and the Inga Dam in the Democratic Republic of Congo are examples. There is also an emergence of policy trends, from regional free trade agreements to improved PPP frameworks across a large number of countries, which suggests that the enabling environment for infrastructure development is improving each day,” said Sultan Ahmed Bin Sulayem, Chairman and CEO, DP World Group.

PORT CONSTRUCTION, EXPANSION IMPROVING TRADE CORRIDOR EFFICIENCY

In order to address the infrastructure gap, governments in Africa have strategized to make heavy investment on ports and railway projects while enticing both domestic as well as foreign players into the business.