FINANCING AFRICAN INFRASTRUCTURE Can the World Deliver (original) (raw)
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2011
Unit of the Public Investment Department (PID) of the Ministry of Finance and Economic Planning (MOFEP) and with support from the World Bank and Public Private Infrastructure Advisory Facility (PPIAF). The la er is a multidonor technical assistance facility aimed at helping developing countries improve the quality of their infrastructure through private sector involvement. The authoring team of Riham Shendy, Zachary Kaplan, and Peter Mousley would like to thank the MOFEP and the PFA Unit for their collaboration and guidance on this study. We would also off er our deep thanks to the Federal Government of Nigeria (FGN), specifi cally the Infrastructure Concession Regulatory Commission (ICRC), and the governments of Kenya, Senegal, Côte d' Ivoire, and Cameroon. Input for this report for the Francophone countries was made possible by the background report completed by Axelcium Consultants and for the Anglophone countries from Benjamin Darche and Thomas Cochran. We extend our thanks to our colleagues at PPIAF who provided the resources for this study. World Bank staff who have also provided guidance and feedback include Clemente
Aid and Infrastructure Financing: Emerging challenges with a focus on Africa
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Africa has a severe shortage of infrastructure. Addressing this shortage involves both correcting the problems of poor maintenance and underinvestment that have caused it and raising the finance for a phase of remedial investment. We review evidence that substantiates the shortage, in terms of both stocks and the potential for high rates of return. We then turn to the range of options for attracting remedial finance, focusing in particular on how they relate to the region's endowment of natural resources. Governments will need to build the regulatory and technical capacities to tap into this opportunity for leveraged private capital flows by reducing the risks associated with large, capital-intensive projects. Furthermore, governments must build the authority necessary to manage both the challenges associated with deferred public consumption and the time consistency needed to support long-term ventures.
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While Africa faces a huge infrastructure gap, there are measures that Group of 20 (G20) countries and its institutions can take to ensure greater and faster infrastructure investments. G20 institutions, particularly development finance institutions (DFIs), should undertake enhanced local approaches to blended finance. Likewise, G20 governments and associated institutions should rapidly address options for reducing project cycle timelines and complexity. They should also intensify efforts to mitigate fiscal risks in public-private partnerships to make projects more bankable, and address off-budget or opaque contingent liabilities. These actions will lead to more productive infrastructure investment, thereby leading to improvements in connectivity and quality of life for communities across Africa. T20 Policy Brief, TF3: Infrastructure Investment and Financing https://t20saudiarabia.org.sa/en/briefs/Pages/Policy-Brief.aspx?pb=TF3\_PB2
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