A new report released today by the Global Infrastructure Hub, a G20 initiative, has revealed an infrastructure investment gap of US$1 trillion in 10 Compact with Africa countries over the next 22 years. This represents a 42 per cent investment gap; one of the largest regional gaps in the world.
Global Infrastructure Outlook: Infrastructure Investment Need in the Compact with Africa Countries, finds that US$2.4 trillion of investment is required in 10 countries by 2040 if they are to keep pace with economic growth and close infrastructure gaps. Only US$1.4 trillion is expected to be delivered based on current spending levels.
Further, of the US$1 trillion investment gap, US$415 billion is required by 2030 if these countries are to meet the UN Sustainable Development Goals (SDGs) for universal access to drinking water, sanitation and electricity.
Outlook forecasts – for the first time – the scale of the infrastructure investment need, current investment trends, and corresponding investment gaps in 10 Compact with Africa countries at a country and sector level.
According to the Annual Global Infrastructure Investor Survey 2017 by the Global Infrastructure Hub and EDHEC Infrastructure Institute-Singapore, 37 per cent of infrastructure investors invest in emerging markets, up from 20 per cent in 2016. Of those already investing in emerging markets, 82 per cent want to increase their investment.
Global Infrastructure Hub CEO Chris Heathcote said that, “These figures demonstrate a clear desire from investors to spend more in emerging markets. However, attracting private sector investment into African countries remains a major challenge.”
“The key to addressing this is creating the right environment to encourage investors to turn their interest into action,” Mr Heathcote added.
The Global Infrastructure Hub’s newly-updated tool, InfraCompass: Set your Infrastructure Policies in the Right Direction in the Compact with Africa Countries, has revealed that opportunities for improvement lie in governance and the regulatory and institutional frameworks in each of the countries. InfraCompass finds that Morocco and Rwanda are notable performers, marked by improvements to their regulatory quality, rule of law, and investment and competition frameworks.
Mr Heathcote said that partnering with the 10 countries to address these matters would build investor confidence and lead them to fulfil their economic growth potential.
“It’s now more important than ever that emerging markets continue to develop their infrastructure project pipelines, as well as continuing a track record of attracting public and private capital into well-identified, selected and prioritised projects,” Mr Heathcote said.
“As the investment environment in these 10 countries improves, there is a real opportunity for infrastructure investors to deliver impactful projects; providing access to essential services— roads and rail, airports and seaports, telecommunications, drinking water, sanitation and energy— for a large proportion of the population.”
Thierry Déau, Founder, Chairman and CEO of Meridiam, said that the Global Infrastructure Hub has provided much-needed new data that reveals the infrastructure investment gap at a country and sector level.
As an active investor in Africa, this new data from the Global Infrastructure Hub will help us to identify where needs are greatest and where we as investors can assist in meeting the UN SDGs which are at risk of not being achieved unless we all—investors, governments and advisers—scale up our commitments to the region.
Philippe Valahu, CEO, Private Infrastructure Development Group (PIDG) agreed.
“Investing in emerging markets is core business for PIDG, having mobilised more than US$15 billion of private sector investment in Africa since 2002, and launching InfraCredit, which has been transformative in emerging financial markets,” Mr Valahu said.
“The Global Infrastructure Hub’s new data reveals the urgent need for much higher investment and the vast opportunity for institutional investors to help close infrastructure gaps and achieve risk adjusted returns.”
The two reports were researched and developed over a six-month period in partnership with Oxford Economics (Outlook) and KPMG (InfraCompass). Both are available in an interactive format on our open access platform at https://www.gihub.org.
 The 10 countries are: Morocco, Tunisia, Egypt, Ethiopia, Senegal, Guinea, C？te d’Ivoire, Ghana, Benin, Rwanda
 The Global Infrastructure Hub and EDHEC Infrastructure Institute-Singapore (EDHECinfra) https://www.gihub.org/resources/publications/edhec-annual-global-infrastructure-investor-survey-2017/