The Economic Commission for Africa will be hosting an Expert Group Meeting on Risks in Private Sector Investment in Trans-Boundary Infrastructure in Africa, in Nairobi, Kenya, 13 - 15 July 2017.  This is in support of regional integration and the development of transboundary infrastructure through private sector investment.

When African Heads of State and Government launched the Programme for Infrastructure Development in Africa (PIDA) it was to promote and accelerate regional integration in the continent by building mutually beneficial infrastructure and strengthening the ability of countries to trade and establish regional value chains for increased competitiveness. An interconnected Africa through cross border infrastructure will definitely facilitate the free movement of persons and goods, will promote peace and cooperation among countries and will enhance the livelihood of African people.

Important steps have since been taken by African leaders to show their commitment to the implementation of PIDA. The Presidential Infrastructure Champions Initiative (PICI) through which specific Presidents expressed their personal commitment to PIDA is one example. The Dakar Summit on Infrastructure Financing in Africa organized in Dakar in June 2014, is another example where sixteen cross-border infrastructure projects (see annex) were identified as priority to accelerate Africa’s regional integration. The Summit encouraged the participation of the private sector especially with regards to sourcing for funds for project readiness, project preparation, project ownership, project bankability, sustainability, etc. UNECA and the NEPAD Agency were requested to develop a global advocacy tool by repackaging the basic elements of their joint study on domestic resource mobilization and the outcomes of the Dakar Financing Summit to provide potential investors a one-stop source for substantive information on the projects, including funding, funding gaps, risks, risk mitigation, etc with regards to the 16 DFS projects.

Several interactions with experts and investors identified two critical challenges to private sector investment: risks and the plethora of laws, policies and regulations which pertain to transboundary projects across Africa. Therefore, there arose the need for better understanding of the applicable risks as well as the development of a common framework to harmonize the laws, policies and regulations on investment in transboundary infrastructure, a request that was later made by the AU Summit.

The High Level Policy Dialogue (HLPD) it organized in Kigali, in May 2016, brought together various experts and stakeholders to discuss the reasons for this lag in investment. The objective was to develop a better understanding of the risks involved in these projects and why they are delaying infrastructure development across Africa. The challenges identified and discussed during the meeting included risks unique to transboundary projects such as the divergence in legal systems, corruption, geological constraints, political risks (civil disturbances, coups, insurgencies, war, and government interference), currency inconvertibility, regulatory, terrorism, and the capacity of regional institutions.

 The dialogue helped to form the basis of the series of studies focused on the projects listed below that are part of the sixteen projects identified by the Dakar Financing Summit (DFS). The studies are carried out in three clusters making an exhaustive assessment of the projects and showing the varying levels of country risk based on field trips carried out in the relevant countries.

(i)     Cluster One covers two projects, namely the Lilongwe–Lusaka Fibre Optic Project and the Batoka Gorge Hydropower Project. Both projects touch Malawi, Zambia and Zimbabwe.

(ii)  Cluster Two is about two other projects, namely the Kinshasa-Brazzaville Bridge Project (Democratic Republic of Congo and Republic of Congo) and Ruzizi III Hydropower Dam (Democratic Republic of Congo, Burundi and Rwanda).

(iii) Cluster Three also covers two projects, namely the Dakar-Bamako Rail Project (Senegal, Mali and Guinea Bissau) and the   Sambangalou Hydropower Project (Gambia, Guinea Conakry, Guinea Bissau and Senegal).

The objective of the Expert Group Meeting (EGM) is to exhaustively review the above studies and make substantive inputs and contributions for the purpose of making the studies useful and effective for resource mobilization, particularly through private investment, by providing convincing answers about the risks involved.  The main outcome will be support to the implementation of PIDA, particularly the DFS 16 projects. The studies are expected to trigger or enhance private sector investments through an exhaustive assessment of risks, challenges and failures of fund raising and providing concrete possible solutions. The expected output/outcome of the meeting is a thorough review of the studies to ensure that:

1. The content and structure of the studies are improved.
2. The studies are useful and contain accurate information.
3. The studies are well designed to address the risks and challenges identified.
4. The priorities and needs of potential private investors are well covered.
5. The studies are a lively resource that take into account emerging needs and priorities and geopolitical changes in the relevant sub regions.
6. Overall comments to enhance the quality of the draft studies.

The Meeting will be organized by CDD.  it is expected that the EGM will be attended by representatives of AUC, RECs, NEPAD Agency, African Development Bank SROs, relevant UN agencies operating in Africa, private operators, investment and development banks, other international partners and Friends of Africa. 

For more information, please contact:

Mr. Adeyinka Adeyemi

Head of the Regional Integration and Infrastructure Cluster

Capacity Development Division

United Nations Economic Commission for Africa

Box 3005

Addis Ababa, Ethiopia

Tel: +251-11-5443537 or Mobile: +251-911-201798

Email: adeyemiy@un.org

www.uneca.org

Ms. Mamayenesh Teshome

Capacity Development Division (CDD)

UN Economic Commission for Africa (UNECA)

Addis Ababa, Ethiopia

Tel. +251-11-544 54 60 or cell. +251-11-910 57 64 90

E-mail: teshomem@un.org