SECTOR-BY-SECTOR OPPORTUNITIES 119


The AU has been proactive in marine, road, air and rail transport. Progress is being made, but rail – potentially the most cost-effective mode – is lagging behind, writes Jonathan Hyman


T


he African Union (AU) was established in 2002 to develop the work of its predecessor, the Organisation of African Unity. The AU aims to accelerate the process


of integration across the continent, and to enable it to play its rightful role in the global economy while addressing multifaceted social, economic and political problems. Peace, security and justice have been


the principal focuses of the organisation. Indeed, as declared in the AU’s founding charter, peaceful intergovernmental relations and domestic security are the fundamental preconditions for social and economic development, closer regional relations and integration. But these goals of achieving greater unity and solidarity – promoting political and socio-economic integration, sustainable development and cooperation in all fields of human activity to raise living standards within the continent – can be achieved only through developing the region’s physical connections, thereby facilitating the exchange of peoples, ideas and trade. The political and security picture in


Africa has improved immeasurably in recent years, with political regimes opening up and conflicts becoming less frequent. Every year the electoral calendar in sub-Saharan Africa becomes more crowded, and every year most posts – from the presidency to seats in the National Assembly and town mayoralties – are competed for, rather than seized or bestowed. Sub-Saharan Africa has no shortage of failed states, such as Somalia and Zimbabwe, but some have been rescued, including Liberia and Sierra Leone, while transfers of power by unconstitutional means appear to be


declining. However, in terms of transport infrastructure, despite several infrastructure development programmes since the late 1970s, Africa still has a long way to go. For decades, sub-Saharan Africa’s


abysmal infrastructure has held back the continent’s competitiveness, economic growth prospects and standards of living. According to the Economist Intelligence Unit, the regional economy is forecast to grow by five to six percent per year over the medium term. This growth will place even greater strain on the continent’s insufficient infrastructure to meet strong international demand for commodity exports, especially from Asia, and rising domestic consumer demand for both domestic and imported goods, driven in particular by rapid urbanization. Infrastructure investment is increasing substantially, underpinned by the revenue effects of high commodity prices, generous and cheap loans and resources-for-infrastructure deals from China, strong donor support, and a rise in private participation.


Costly and inefficient According to the Africa Infrastructure Country Diagnostic (AICD, a study on Africa’s infrastructure conducted by the World Bank in partnership with other organizations), the region experiences the worst rates of service disruption, and frequently higher costs, than any other region, owing to inefficiency, inadequate competition and higher operating costs. Transport costs as a share of trade are an estimated 30-40 percent higher than in other developing regions. Most ports are inefficient, with container waiting times averaging 12 days in East Africa and 15 days in West Africa – well above the international benchmark of seven days or fewer. Some challenges are difficult to address, such as low population density and geography – 15 African countries are landlocked – and these problems raise the costs of infrastructure provision. To address infrastructure shortfalls,


Africa needs to spend $93 billion per year, INVEST IN AFRICA 2011


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80  |  Page 81  |  Page 82  |  Page 83  |  Page 84  |  Page 85  |  Page 86  |  Page 87  |  Page 88  |  Page 89  |  Page 90  |  Page 91  |  Page 92  |  Page 93  |  Page 94  |  Page 95  |  Page 96  |  Page 97  |  Page 98  |  Page 99  |  Page 100  |  Page 101  |  Page 102  |  Page 103  |  Page 104  |  Page 105  |  Page 106  |  Page 107  |  Page 108  |  Page 109  |  Page 110  |  Page 111  |  Page 112  |  Page 113  |  Page 114  |  Page 115  |  Page 116  |  Page 117  |  Page 118  |  Page 119  |  Page 120  |  Page 121  |  Page 122  |  Page 123  |  Page 124  |  Page 125  |  Page 126  |  Page 127  |  Page 128  |  Page 129  |  Page 130  |  Page 131  |  Page 132  |  Page 133  |  Page 134  |  Page 135  |  Page 136  |  Page 137  |  Page 138  |  Page 139  |  Page 140  |  Page 141  |  Page 142  |  Page 143  |  Page 144  |  Page 145  |  Page 146  |  Page 147  |  Page 148  |  Page 149  |  Page 150  |  Page 151  |  Page 152  |  Page 153  |  Page 154  |  Page 155  |  Page 156  |  Page 157  |  Page 158  |  Page 159  |  Page 160  |  Page 161  |  Page 162  |  Page 163  |  Page 164  |  Page 165  |  Page 166  |  Page 167  |  Page 168