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Infrastructure FinancingTrends in Africa – 2017

ICA REPORT – 2017WWW.ICAFRICA.ORG

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2 | INFRASTRUCTURE FINANCING TRENDS IN AFRICA – 2017

© 2018 The Infrastructure Consortium for Africa Secretariat c/o African Development Bank

01 BP 1387, Abidjan 01, Côte d'Ivoire

Disclaimer

This report was written by the ICA Secretariat in collaboration with Cross-border Information. Whilecare has been taken to ensure the accuracy of the information provided in this report, the authorsmake no representation, warranty or covenant with respect to its accuracy or validity.

No responsibility or liability will be accepted by the ICA Secretariat, its employees, associates and/orconsultants for reliance placed upon information contained in this document by any third party.

INFRASTRUCTURE FINANCING TRENDS IN AFRICA – 2017 | 3

Infrastructure Financing Trends in Africa – 2017



Acknowledgements

Data Analysis, Text and Layout

Cross-border Information

www.crossborderinformation.com

Graphics and Maps

David Burles

Photos

iStock/Getty Images: Pages 6, 20, 24, 28, 49, 54, 60, 62, 64,

68, 70.

Shutterstock: Pages 72,74, 76

EBRD/Dermot Doorly: Page 58

Infrastructure Financing Trends in Africa – 2017 isthe Infrastructure Consortium for Africa’s (ICA’s)annual report on how financial resources are beingmobilised to facilitate the development of thecontinent’s transport, water and sanitation, energyand ICT sectors.

The ICA’s flagship report was prepared by the ICASecretariat, consisting of Mike Salawou, ICA Coordinator,Epifanio Carvalho de Melo and Kouadio Viviane, incooperation with Cross-border Information (David Burles,Nick Carn, Mark Ford, Irina Gaubinger, Ivana Richardson,David Slater, Ajay Ubhi and Daniel Westbury-Haines) whowere commissioned by the ICA Secretariat.

The ICA Secretariat acknowledges and thanks all thoseorganisations and people without whose help theproduction of this consistent annual monitor of Africa’sinfrastructure financing and development would not havebeen possible. In particular, special thanks to all ICAmembers – the G7: Canada (Chair of ICA), France,Germany, Italy, Japan, UK and the USA; Russia; G20member South Africa; and MDBs members including theEC, EIB, IFC, WB and the AfDB (the host) for theircontribution and guidance in preparing this report.

Institutions contributing to the report include: AfricanDevelopment Bank (AfDB), Arab Fund for Economic andSocial Development (AFESD), Global Affairs Canada(GAC), Development Bank of Southern Africa (DBSA), EastAfrican Development Bank (EADB), Eastern and SouthernAfrican Trade and Development Bank (TDB) Ecowas BankFor Investment And Development (EBID), European Bankof Reconstruction and Development (EBRD), EU-AfricaInfrastructure Trust Fund (EU-AITF), EuropeanInvestment Bank (EIB), Agence Française deDéveloppement (AFD) of France, Germany’s Kreditanstaltfür Wiederaufbau (KfW), Deutsche Gesellschaft fürInternationale Zusammenarbeit (GIZ) and DeutscheInvestitions- und Entwicklungsgesellschaft (DEG),International Finance Corporation (IFC), IslamicDevelopment Bank (IDB), Italy’s Cassa Depositi e Prestiti(CDP) and Ministry of Foreign Affairs and InternationalCooperation, Export–Import Bank of India, Japan Bank forInternational Co-operation (JBIC), Japan International Co-operation Agency (JICA), OPEC Fund for InternationalDevelopment (OFID), the UK’s Department forInternational Development (DFID), and the World Bank.

In particular, we also thank those Regional EconomicCommunities (RECs) and Regional Power Pools (RPPs) thatresponded to our request for data to inform this report,namely Central African Economic and MonetaryCommunity (CEMAC), East African Community (EAC),Southern African Development Community (SADC) andSouthern African Power Pool (SAPP).

Clare Barrington, DFID

Malanda Barthelemy,AfDB

Giovanni Baticci,MFA/CDP

Mathilde Bord-Laurans,AFD

Francis Daniel Bougaire,AfDB

Gregory Briffa, EIB

Antonello Carpentieri,MFA/CDP

Osward Chanda, AfDB

Stephan Diefenthal, DEG

Katerina Evzona, DFID

Gladys Wambui Gichuri,AfDB

Gianluca Grandi,MFA/CDP

Etsuko Ito, JICA

Yuki Ito, JBIC

Jovana Jeftanovic,GIZ

Ben-Hur Kabengele, AFD

Mascha Klein, BMZ

Poirotte Ludovic, EU-AITF

Atadet Azarak Mogro,CEEAC

Hellen ChimwemweMwatuwa, AfDB

Ihcen Naceur, AfDB

Maimuna Nalubega, AfDB

David Niyonsenga,NEPAD

Fiore Pace, GAC

Peter Radloff, KfW

Michele Ruiters, DBSA

Omar Vajeth, SAPP

Anna Waldmann, GIZ

Alvino Wildschutt-Prins,DBSA

Ahid Maeresera, SADC

Victoria Zabolotnyi, IFC

We express our personal thanks to all those whocontributed data and insights for the report, including:


Contents

Introduction 6About Us 6

Foreword 7

Definitions and Acronyms 8

List of Graphics and Maps 10

1. The Big Picture 111.1 Key Messages and Findings 12

2. Financing Trends 142.1 Who is Financing Africa’s Infrastructure 14

2.2 Financing Trends by Sector 16

2.3 Financing Trends by Region 18

3. Strategic Trends 203.1 Overview 20

3.2 Infrastructure Financing Gap 21

3.3 Intra-African Free Trade 24

3.4 Regional Cooperation 25

3.5 Regional Economic Communities and Power Pools 26

4. ICA Member Financing 284.1 Overview 28

4.2 Types of Funding 30

4.3 Hard vs Soft Infrastructure 32

4.4 Trends in Commitments and Disbursements 33

4.5 Projects Completed 37

4.6 Disbursement Rates 38

4.7 Trends in Regional Infrastructure Portfolios 39

4.8 PIDA/PAP Commitments, Disbursements & Trends 40

4.9 Country Allocations 42

4.10 ICA Member Activities 43

5. Other Public Sources of Financing 485.1 African State Spending on Infrastructure 48

5.2 China 54

5.3 Arab Co-ordination Group 56

5.4 Non-ICA European Sources 58

5.5 Other Sources of Financing 60

5.6 Regional Development Banks 63

6. Private Sector 646.1 Private Sector Engagement with the Public Sector 64

7. Sectoral Analysis 687.1 Overview 68

7.2 Transport 70

7.3 Water and Sanitation 72

7.4 Energy 74

7.5 ICT 76

8. Regional Analysis 788.1 North Africa 78

8.2 West Africa 79

8.3 Central Africa 80

8.5 East Africa 81

8.6 Southern Africa 82

8.7 Republic of South Africa 83

Annexes 84


About the ICA

The Infrastructure Consortiumfor Africa (ICA) was launched atthe G8 Gleneagles summit in 2005.The membership is the G8countries, the Republic of SouthAfrica, the World Bank Group(WBG), the African DevelopmentBank Group (AfDB), the EuropeanCommission (EC), the EuropeanInvestment Bank (EIB) and theDevelopment Bank of SouthernAfrica (DBSA).

African institutions such as theAfrican Union (AU), the NewPartnership for Africa’s Development(NEPAD) and the Regional EconomicCommunities (RECs) all participate asobservers in the meetings of theconsortium. AfDB has hosted theSecretariat of the ICA since itsinception in 2006.

At the May 2011 Annual meeting ofthe Consortium, the decision wasmade to enlarge ICA membershipfrom G8 to G20. In November 2013,

South Africa joined the ICA as the firstG20 country non-G8, and first Africancountry member of the ICA.

The ICA is a major initiative toaccelerate progress to meet the urgentinfrastructure needs of Africa insupport of economic growth anddevelopment. It addresses bothnational and regional constraints toinfrastructure development with anemphasis on regional infrastructure,recognising the challenges at thisscale.

The Consortium is intended to makeits members more effective atsupporting infrastructure by poolingefforts in selected areas such asinformation sharing, project develop-ment and good practices.

Although ICA is not a financingagency, the consortium acts as aplatform to broker more financing ofinfrastructure projects andprogrammes in Africa. The main

objectives of the ICA can be broadlydefined as follows:

• Increase the amount of financegoing to sustainable infrastructure inAfrica from public and private sources;

• Facilitate greater co-operationbetween members of ICA and otherimportant sources of finance includingAfrican stakeholders, China, India,Arab Funds and the private sector;

• Highlight and help remove policyand technical blockages and progress;

• Increase knowledge of the sectorthrough monitoring and reporting onthe key trends and developments.

Increasingly, the ICA is working toimprove the co-ordination of activitiesamong members, and with othersignificant sources of infrastructurefinance, including China, India, Araband Islamic financiers, Africanregional development banks and theprivate sector.


Foreword

We have the pleasure of presenting to you the ninthedition of the ICA annual report, InfrastructureFinancing Trends in Africa, 2017. Over the years thereport has become an important document forpresenting in a consistent manner how finance isbeing mobilised to develop infrastructure across theenergy, ICT, transport, and water and sanitationsectors. It also identifies emerging trends on howresources are mobilised effectively to accelerateAfrica’s infrastructure development.

One of the important issues addressed in this year’s reportis the amount African states spend on infrastructure. Suchspending is analysed not only at a national level, but alsoat a subnational level – where it can be identified thatspending has not been accounted for in federal or nationalbudgets. It is important to note that more work is requiredto develop methodologies that adequately capture spendingby state institutions and subnational governments andensure that double counting is avoided.

Another persistent issue is Africa’s infrastructure financinggap and it is encouraging to see ICA’s own research onfinancing trends contributing to this debate. This year’sreport examines the extent to which the lack of investment ininfrastructure is a matter of limited bankable projectsrelative to the availability of financial resources.Stakeholders interviewed for this report suggest that thereare enough funds for Africa’s infrastructure development.The challenge, however, is creating more bankable projects.Other stakeholders maintain the financing gap remains forbankable projects.

Africa is embarking on a journey to create a continental freetrade area that must fully embrace the need to develop itsinfrastructure. The African Continental Free Trade Area hasthe potential to transform the continent. But infrastructureis needed to ensure deeper and broader regional integration,add value to its resources and catalyse growth in intra-African trade. This is particularly important if Africa is torealise its potential in sectors where growth prospects arebrightest, such as agriculture and food, industry and services.Regional infrastructure projects must play a key role inpromoting equitable and sustainable growth.

This report highlights some notable achievements in Africa’sinfrastructure sector. It shows how regional infrastructureprojects can have the continental impact needed for a fullyfunctioning free trade area. A good example is the Zambia-Tanzania-Kenya Interconnector project which is one of theProgramme for Infrastructure Development in AfricaPriority Action Plan projects and programmes. Beyond theregional benefits, the project will connect the southern andeastern African power pools and enhance inter-regionalelectricity trading by interconnecting the two pools’ grids. Theproject is expected to create the largest power pool on the

continent and will be an essential component of the North-South (Cape to Cairo) power transmission corridor.

Mobilising funds for infrastructure is critical, and this reportshows a high level of interest in new types of funding. Inparticular, the report recognises the demand for blendedfinance, in which concessional finance seeks to leverage non-concessional finance. Infrastructure Financing Trends inAfrica, 2017 also reports for the second year thatorganisations are increasingly deploying developmentcapital. This is important because it is not a grant, rather itcreates an asset for the investor and can provide modestfinancial returns alongside significant development impacts.

This year’s report provides examples of how finance hasbeen mobilised for bankable projects likely to have asignificant development impact. One example is theBenban solar park project in Egypt, which shows how amixture of public and private sector finance can bemobilised by establishing sound institutionalarrangements to produce 23 bankable projects.

Challenges for Africa’s infrastructure remain. Morebankable projects will be needed to both attract new andretain existing financiers to help close Africa’sinfrastructure financing gap. We hope that moreinstitutions will join the cohort of financiers who addressthe challenges involved, from project preparation tocapacity building, and see opportunities and benefits infinancing Africa’s infrastructure.

It is encouraging to see that new financing techniques arebeing developed. The challenge is to continue expandingthe range of financial instruments available andintegrating offerings such as blended finance anddevelopment capital with conventional instruments suchas grants and loans that will continue to play a role ininfrastructure financing.

We hope this report will help broaden the range ofstakeholders and increase the range of financingtechniques used in Africa’s infrastructure development. Wealso hope Infrastructure Financing Trends in Africa, 2017will help stakeholders address the challenge of establishingsound institutional arrangements that provide the rightconditions for public and private sector actors to participatein the development of projects. Finally, we hope this reportwill help mobilise more finance for Africa’s infrastructuredevelopment.

Pierre Guislain, Vice President, Private sector, industryand infrastructure, AfDB

Amadou Oumarou, Director Infrastructure and Urbandevelopment, AfDB

Mike Salawou, Manager Infrastructure Partnerships andICA Coordinator


Definitions and Acronyms

AcronymsACG – Arab Co-ordination Group

ADFD – Abu Dhabi Fund for Development

AfCFTA – Africa Continental Free TradeArea

AFD – Agence Française deDéveloppement

AfDB – African Development Bank

AFESD – Arab Fund for Economic andSocial Development

AfIF – EU-Africa Investment Facility

AICS – Italian Development CooperationAgency

AIP – EU’s Africa Infrastructure Platform

AKFED – Aga Khan Fund for EconomicDevelopment

AU – African Union

BADEA – Banque Arabe pour leDéveloppement Economique en Afrique

BMZ – Germany’s Federal Ministry ofEconomic Cooperation andDevelopment

Budget DataBudget allocations: Total approvedgovernment budget for the respectiveitem.

Total infrastructure budget: Sumof energy, water and sanitation,transport, and ICT budget allocations.Where available, significant multi-sector or other infrastructureallocations are indicated separately.

ICA MembersAfDB, DBSA, EC, EIB, G7 countriesand Russia, Republic of South Africaand the World Bank Group. In 2011all G20 countries were invited to jointhe ICA. The AU Commission,NEPAD Secretariat and RegionalEconomic Communities participateas observers at ICA meetings.

InfrastructureTotal infrastructure budget: Sumof energy, water and sanitation,transport, ICT, and multi-sectorinfrastructure budget allocations.

Hard infrastructure: Physicalinfrastructure.

Soft infrastructure: Measures tosupport or accompany the productionof physical infrastructure outputs,including research, enablinglegislation, project preparation andcapacity building.

Project preparation: Theundertaking of all project preparationcycles or development activitiesnecessary to take an infrastructureproject from identification throughconcept design to financial close. This

includes feasibility testing andfinancial and legal structuring, as wellas raising capital.

FundingCommitments: Direct fundsapproved in a given year to projectsover their lifetime.

Disbursements: Money outflowgoing to infrastructure projects duringa given year.

ODA – official developmentAssistance: Grant or loan with publicconcessional modalities administeredby donor government agencies.

Non ODA: Non-concessional fundingfrom public or private sources.

Regional project: Projects withdirect beneficiaries in more than onecountry. These can either be cross-border projects or other regionalintegration projects involving aminimum of two countries or nationalprojects.

LocationNorth Africa: Algeria, Egypt, Libya,Mauritania, Morocco, Tunisia.

West Africa: Benin, Burkina Faso,Cape Verde, Gambia, Ghana, Guinea,Guinea Bissau, Côte d’Ivoire, Liberia,Mali, Niger, Nigeria, Senegal, SierraLeone, Togo.

Central Africa: Burundi, Cameroon,Central African Republic (CAR),Chad, Congo, Democratic Republic ofCongo (DRC), Equatorial Guinea,Gabon, Rwanda, São Tomé andPríncipe (STP).

East Africa: Djibouti, Eritrea,

Ethiopia, Kenya, Seychelles, Somalia,South Sudan, Sudan, Tanzania,Uganda.

Southern Africa excluding RSA:Angola, Botswana, Comoros, Lesotho,Madagascar, Malawi, Mauritius,Mozambique, Namibia, Swaziland,Zambia, Zimbabwe.

RSA: Republic of South Africa.

Regional DevelopmentBanksCentral African States DevelopmentBank (CASDB), DBSA (an ICAmember), EBID, EADB, West AfricanDevelopment Bank (BOAD).

SectorTransport: Airports, ports, rail, road.

Energy: Generation, transmissionand distribution of electricity and gas(including pipelines, and associatedinfrastructure).

Water and sanitation: Sanitation,irrigation, (trans-boundary) waterresource infrastructure, water supply,waste (solid & liquid) treatmentand management.

ICT: Information and communicationtechnology, including broadband,mobile network, satellite.

Multi-sector: Not sector-specific orcross-cutting projects. This couldinclude implementation of a PPP unitor capacity building programmes.

Unallocated: Commitments whichcover multiple ICA sectors but whichare unable to be accurately allocated.


BOAD – Banque Oueste Africaine deDéveloppement

CADFund – China-Africa DevelopmentFund

CDP – Italy’s Cassa Depositi e Prestiti

CGC – China Geo-EngineeringCorporation

CGGC – China Gezhouba GroupCorporation

COIDIC – China Overseas InfrastructureDevelopment and InvestmentCorporation

Comesa – Common Market for Easternand Southern Africa

CRBC – China Road and Bridgecorporation

CSP – concentrated solar power

DBSA – Development Bank of SouthernAfrica

DEG – Deutsche Investitions- undEntwicklungsgesellschaft

DFI – Development finance institutions

DFIC –Development Finance InstituteCanada

DFID – UK’s Department for InternationalDevelopment

DRC – Democratic Republic of Congo

EAC – East African Community

EAIF – Emerging Africa InfrastructureFund

EAPP – Eastern Africa Power Pool

EBID – Ecowas Bank for Investment andDevelopment

EBRD – European Bank forReconstruction and Development

EC – European Commission

Ecowas – Economic Community of WestAfrican States

EDC – Canada’s Export DevelopmentCorporation

EGAS – Egyptian Natural Gas HoldingCompany

EIB – European Investment Bank

ENH – Mozambique's Empresa Nacionalde Hidrocarbonetos

EU – European Union

EU-AITF – EU-Africa Infrastructure TrustFund

FMO – Netherlands’ DFI

G20 – Argentina, Australia, Brazil,Canada, China, EU, France, Germany,India, Indonesia, Italy, Japan, Mexico,Russia, Saudi Arabia, South Africa,Turkey, UK and US

G8 – Canada, France, Germany, Italy,Japan, Russia, UK and US

GFI – Global Financial Integrity

GIZ – Deutsche Gesellschaft fürInternationale Zusammenarbeit

HFO – heavy fuel oil

ICA – Infrastructure Consortium forAfrica

ICD – Islamic Corporation for theDevelopment of the Private Sector

IDA – International DevelopmentAssociation

IDB – Islamic Development Bank

IFC – International Finance Corporation

IFU – Denmark’s DFI

IPP – independent power producer

JBIC – Japan Bank for International Co-operation

JICA – Japan International Co-operationAgency

KFAED – Kuwait Fund for Arab EconomicDevelopment

KfW – Germany’s development bank

LPG – liquefied petroleum gas

MAECI – Italy’s Ministry of Foreign Affairsand International Co-operation

MCC – US’ Millenium ChallengeCorporation

MENA – Middle East and North Africa

MIGA – Multilateral InvestmentGuarantee Agency

NDB – BRICS’ New Development Bank

NEPAD – New Partnership for Africa’sDevelopment

NEPAD-IPPF – NEPAD InfrastructureProject Preparation Facility

NIPP – National Integrated Power Project

NPCA – NEPAD Planning and Co-ordinating Agency

ODA – official development assistance

OECD – Organisation for Economic Co-operation and Development

OeEB – Austria’s development bank

OFID – OPEC Fund for InternationalDevelopment

OMVG – Organisation pour la Mise enValeur du Fleuve Gambie

PIDA – Programme for InfrastructureDevelopment in Africa

PIDA/PAP – PIDA Priority Action Plan

PPA – power purchase agreement

PPDF – SADC Project Preparation andDevelopment Facility

PPI – World Bank’s Private Participationin Infrastructure

PPP – public-private partnerships

PV – photovoltaic

rAREH – responsAbiity RenewableEnergy Holding

RBD – regional development bank

REC – Regional Economic Community

REIPPP – South Africa’s RenewableEnergy Independent Power ProducerProcurement programme

RIPDM – SADC Regional InfrastructureDevelopment Master Plan

RPP – regional Power Pool

RSA – Republic of South Africa

SADC – Southern African DevelopmentCommunity

SBM – State Bank of Mauritius

SFD – Saudi Fund for Development

SGR – standard gauge railway

SNCFT – Société Nationale des Cheminsde Fer Tunisiens

TDB – Trade and Development Bank

TTA – DFID Tripartite Trust Account

UNECA – United Nations EconomicCommission for Africa

WBG – World Bank Group

YMI – Yapi Merkezi Insaat ve Sanayi

ZPC – Zimbabwe Power Company

ZTK – Zambia-Tanzania-Kenya powertransmission interconnector


Graphics and Maps

Figure 1: ICA member commitments & disbursements, 2013-17 12Figure 2: Infrastructure commitment trends by source, 2013-17 12Figure 3: Infrastructure commitment trends by sector, 2013-17 12Figure 4: Total infrastructure financing in 2017 by source 13Figure 5: Total infrastructure financing in 2016 by region 13Figure 6: Total infrastructure financing in 2017 by sector 13Figure 7: Reported and identified financing flows into Africa’s infrastructure, 2017 14Figure 8: Sources of finance 2017, public external and private 15Figure 9: Infrastructure commitments by sector & region, 2017 15Figure 10: Infrastructure commitments by sector & source, 2017 16Figure 11: Total infrastructure financing by sector, 2013-17 17Figure 12: ICA member commitments by sector, 2013-17 17Figure 13: Average annual total infrastructure financing by sector, 2013-2017 17Figure 14: 2017 infrastructure commitments by region & source 18Figure 15: Total infrastructure financing by region, 2013-17 19Figure 16: ICA member commitments by region, 2013-17 19Figure 17: Average annual total infrastructure financing by region, 2013-17 19Figure 18: Infrastructure financing needs by sector 21Figure 19: Average annual commitments by sector 2012-17 21Figure 20: ZTK Interconnector and regional power pools 25Figure 21: Implementation status of EAC priority projects 26Figure 22: ICA member 2017 commitments by sector 28Figure 23: ICA member 2017 commitments by region 28Figure 24: ICA member 2017 commitments by type of funding 30Figure 25: ICA member 2017 hard/soft/project preparationinfrastructure commitments 32Figure 26: ICA member 2017 hard/soft/project preparationinfrastructure disbursements 32Figure 27: ICA member commitments by sector, 2010-17 33Figure 28: ICA member commitments by region, 2010-17 33Figure 29: ICA member 2017 commitments by donor & region 34Figure 30: ICA member 2017 disbursements by donor & region 34Figure 31: ICA member 2017 commitments by sector & region 35Figure 32: ICA member 2017 disbursements by sector & region 35Figure 33: ICA member disbursements by sector, 2013-17 35Figure: 34: ICA member supported projects completed in 2017 – commitments and disbursements 37Figure 35: ICA member supported projects completed in 2017 – breakdown by sector 37Figure 36: ICA member supported projects completed in 2017 – breakdown by region 37Figure 37: Disbursement rates per sector for selected ICAmember projects completed in 2017 38Figure 38: Trends in regional infrastructure portfolios, 2010-17 39Figure 39: Specified ICA member commitments to PIDA projects 41Figure 40: ICA member reported country-level commitments by region, 2017 42Figure 41: ICA member reported 2017 country-levelcommitments, $ spend per capita and as percentage of GDP 42Figure 42: Government budget allocations by sector, 2013-17 49Figure 43: Government budget allocations by region, 2017 49Figure 44: Allocations to infrastructure in national budgets, 2017,by $ per capita

Figure 45: Allocations to infrastructure in national budgets,2017, as percentage of GDP 51Figure 46: Percentage of infrastructure allocations in national budgets by sector and region, 2017 51Figure 47: Total 2017 infrastructure capital expenditureallocations in national government budgets, by sector 51Figure 48: Chinese commitments by sector, 2012-17 54Figure 49: Chinese commitments by region, 2012-17 55Figure 50: ACG commitments by sector and region, 2013-17 56Figure 51: ACG commitments, by member, 2013-17 57Figure 52: Non-ICA European commitments by source, 2017 58Figure 53: Non-ICA European commitments by sector, 2017 59Figure 54: Non-ICA European commitment by region, 2017 59Figure 55: Indian commitments by sector, 2013-17 61Figure 56: BOAD commitments by sector, 2017 63Figure 57: EBID commitments by sector, 2017 63Figure 58: TDB commitments by sector, 2017 63Figure 59: PPI Project Database trends, 2013-17 64Figure 60: Private sector financing by sector, 2017 64Figure 61: Private sector financing by region, 2017 64Figure 62: Total financing by sector and source, 2017 69Figure 63: Total transport sector financing by source, 2013-17 71Figure 64: Total transport sector financing by region, 2016 70Figure 65: Total transport sector financing by region, 2017 71Figure 66: Transport sector financing by type of funding, 2017 71Figure 67: Transport financing by sub-sector, 2017 71Figure 68: Total water sector financing by source, 2013-17 73Figure 69: Total water sector financing by region, 2016 72Figure 70: Total water sector financing by region, 2017 73Figure 71:Water sector financing by type of funding, 2017 73Figure 72: Water financing by sub-sector, 2017 73Figure 73: Total energy sector financing by source, 2013-17 75Figure 74: Total energy sector financing by region, 2016 74Figure 75: Total energy sector financing by region, 2017 75Figure 76: Energy sector financing by type of funding, 2017 75Figure 77: Energy financing by sub-sector, 2017 75Figure 78: Total ICT sector financing by source, 2013-17 77Figure 79: ICT energy sector financing by region, 2016 76Figure 80: Total ICT sector financing by region, 2017 77Figure 81: ICT sector financing by type of funding, 2017 77Figure 82: ICT financing by sub-sector, 2017 77Figure 83: Financing to North Africa by sector & source, 2017 78Figure 84: Trends in North Africa financing by source, 2013-17 78Figure 85: Financing to West Africa by sector & source, 2017 79Figure 86: Trends in West Africa financing by source, 2013-17 79Figure 87: Financing to Central Africa by sector & source, 2017 80Figure 88: Trends in Central Africa financing by source, 2013-17 80Figure 89: Financing to East Africa by sector & source, 2017 81Figure 90: Trends in East Africa financing by source, 2013-17 81Figure 91: Financing to Southern Africa by sector & source, 2017 82Figure 92:Trends in Southern Africa financing by source, 2013-17 82Figure 93: Financing to RSA by sector and source, 2017 83Figure 94: Trends in RSA financing by source, 2013-2017 83


North Africa$15.9bn(19.5%)

East Africa$15.8bn(19.4%)

RSA$8.7bn(10.7%)

West Africa$22.0bn(27.0%)

CentralAfrica

$6.0bn(7.4%)

Southern Africaexcluding RSA$12.2bn (15.0%)

Pan-African$0.9bn (1.1%)

Arab Co-ordinationGroup $3.0bn (3.7%)

China$19.4bn(23.8%)

Other bilaterals/multilaterals

$2.9bn (3.5%)

Privatesector$2.3bn(2.8%)

African nationalgovernments

$34.3bn(42.1%)

ICA members$19.7bn(24.1%)

Ð11%6%

Ð21%

20

17: $

81.

6b

n

20

15: $

78.9

bn

20

14: $

75.4

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20

13: $

83

.3b

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20

16: $

66

.9b

n22%

Total funding reached $81.6bn in 2017

Funding increased by 22% It came from

And these sectors Went to these regions

Unallocated $2.2bn (2.7%)

Multi-sector $5.1bn (6.3%)

Transport $34.0bn (41.7%)

Water $13.2bn (16.2%)

Energy $24.8bn (30.4%)

ICT $2.3bn (2.8%)

1. The Big Picture 2017


Overall commitments to Africa’sinfrastructure from all sourcesincreased to $81.6bn in 2017 from$66.9bn in 20161. Though fewerICA members reported data thisyear than in the past, this is the highest level of directly com-parable commitments report-edsince 2010.

Factors driving the highercommitments include a $13bnincrease in identified Chineseinvestments from $6.4bn to $19.4bn,and a $3.7bn increase in Africannational and subnational governmentspending from $30.7bn to $34.4bn.

According to the World Bank’s PrivateParticipation in Infrastructure (PPI)Project Database, the value ofprojects with private sectorparticipation reaching financialclose in 2017 totalled $5.2bn, anincrease from the $3.6bn reported in2016. Of this, $2.3bn (44.8%) wasprivately financed.

Commitments from ICA membersto Programme for InfrastructureDevelopment in Africa PriorityAction Plan (PIDA/PAP) projectsamounted to $2.8bn, one-thirdhigher than the $2.1bn committed toPIDA from all sources in 2016.

ICA members committed $19.7bnto African infrastructure projects

1.1 Key Messages and Findings

2013 2014 2015 2017 2013 2014 2015 20172016 2016

90

80

70

60

50

40

30

20

10

0

$bn

90

80

70

60

50

40

30

20

10

0

$bn

30.5

34.5

24.0

30.7

8.8

2.0

13.4

3.3

25.3

18.8

3.4

3.1

3.5

2.9

7.4

20.9

2.4

4.4

19.818.6

5.5

6.4

3.1

2.6

7.0PowerAfrica

2.0

2.7

1.0

2.3

1.9

28.6

11.2

37.3

34.2

9.4

24.1

2.4

2.6

2.2

33.5

2.4

7.5

32.4

26.2

9.18.4 domesticbond issue0.7 sub-nationalfinancing

19.7

3.0

19.4

2.9

2.3

34.3

12.2

20.61.7

2.8

3.4

34.0

13.2

24.8

2.3

5.1

2.2

African national governments

Private sector


China

Arab Co-ordination Group

ICA members

Other/unallocated

Multi-sector

ICT

Energy

Water

Transport

Total: 83.3

75.4

78.9

66.9

81.6Total: 83.3

75.4

78.9

66.9

81.6

in 2017, an increase of 5% from the$18.6bn reported in 2016. Thisrepresents one of the highestcommitments since the ICA begancollecting data in 2010, only slightlybelow the 2015 high of $19.8bn.

African state spending on infra-structure, which for the first time includes subnational statespending, where it can be identified,increased from $30.7bn in 2016 to$34.4bn in 2017. Data for 2016 have

been adjusted to include identifiedsubnational spending.

Commitments from non-ICAmember bilaterals and multi-laterals (excluding China) toAfrican infrastructure projectsreached $5.8bn in 2017. Of this, theArab Coordination Group (ACG)committed $3bn compared with the$3.8bn and $4.4m recorded in 2016 and2015, respectively.

2013 2014 2015 2016 2017

25

20

5

0

$bn

15

10

11.3

13.0

12.6 13

.4

18.619

.8

18.8

25.3

7.0PowerAfrica

10.9

19.7

ICA commitments (annual average: $20.4bn)

ICA disbursements (annual average: $12.3bn)

Figure 2Infrastructure commitment trends bysource, 2013-2017

Figure 3Infrastructure commitment trends bysector, 2013-2017

Figure 1ICA members’ commitments anddisbursements, 2013-2017


India committed just over $700mto infrastructure projects in 2017,the highest level since 2013. However,this is down from the high amount of$1.2bn committed in 2016. Identifiedcommitments made by South Korea in2017 stood at $10m compared with$432m in 2016, but this was asignificantly high figure comparedwith previous years.

With commitments of $34bn, thetransport sector continued to bethe largest beneficiary of infra-structure commitments in 2017 bya significant margin. Financing oftransport infrastructure was equal to41.7% of all funding. As with previousyears, most of the $20.1bn wasprovided by African national orsubnational governments. The energysector, which recorded $24.8bn ofinvestments in 2017, accounted for30.4% of the total. The water sectoraccounted for $13.2bn (16.2%), followedby multi-sector investments, whichregistered $5.1bn (6.3%).

Official development assistance(ODA) financing accounted for62% of all ICA member commit-ments and non-ODA financingaccounted for 25%. ICA memberswere unable to provide data on theremaining 13%. About two-thirds ofmember disbursements in 2017 werefrom ODA sources, with the remainingthird being non-ODA.



RSA$8.7bn(10.7%)


CentralAfrica

$6.0bn(7.4%)


Pan-African$0.9bn(1.1%)

Transport$34.0bn(41.7%)

Water$13.2bn(16.2%)

Energy$24.8bn(30.4%)

ICT$2.3bn (2.8%)

Multi-sector$5.1bn (6.3%)

Unallocated$2.2bn(2.7%)

ICA members$19.7bn(24.1%)

ArabCo-ordination

Group$3.0bn (3.7%)

China$19.4bn(23.8%)

Other bilaterals/multilaterals$2.9bn (3.5%)

Private sector$2.3bn (2.8%)


$34.3bn(42.1%)

Total:$81.6bn

Total:$81.6bn

Total:$81.6bn

Figure 4Total infrastructure financing in 2017by source

Figure 5Total infrastructure financing in 2016 by region

Figure 6Total infrastructure financing in 2017by sector

1 Due to new data, the 2016 figure of $62.5bnhas been restated in this report as $66.9bn.

Soft infrastructure commitmentsdeclined to $1.5bn in 2017 from$1.7bn in the previous year.Although this is higher than the$1.3bn reported in 2015, it remainsbelow the $2.3bn and $1.8bn reportedin 2014 and 2013, respectively. ICAmember commitments made to projectpreparation fell from $245m in 2016 to$120m in 2017. After recovering to$1.4bn in 2016, soft infrastructuredisbursements declined to $717m.

ICA members disbursed $10.9bn in2017, below the 2011-2016 averagewhich ranges between $11.4bn-13.4bn.Consistent with reporting in previousyears, the majority of disbursements in2017 were directed towards the energysector (44%).

Recent estimates by the AfDBpublished in its African EconomicOutlook, 2018 suggest that Africa’sannual infrastructure financingrequirements amount to $130bn–$170bn with a gap in the range of$68bn–$108bn.

Data analysed for InfrastructureFinancing Trends in Africa, 2017suggests a slightly narrowerfinancing gap than that in theAfrican Economic Outlook, 2018.The latter is based on totalcommitments of $62.5bn as stated inInfrastructure Financing Trends inAfrica, 2016. Given that commitmentsreported in 2016 were the lowest in

recent years, this is likely tounderestimate the average annualamount committed to Africa’s infra-structure over recent years. Analysis inthis report shows average commit-ments over the last six years of $77bn,suggesting an annual financing gapover the period 2012-17 in the$53bn-$93bn range.

The infrastructure financing gapis certainly wider in some sectorsthan others. In this regard, the watersector is a source of concern, with an81-84% shortfall in its annualfinancing requirement. But thetransport sector is short of itsfinancing requirement by only 8%.This gap is considered very low.

Public and private stakeholdersconsulted in the preparation ofthis report said the main reasonsfor Africa’s infrastructure deficitcentre not on a lack of funds but alack of bankable projects. As notedin previous years, countries with soundinstitutional arrangements areattracting public and private sectorfinance. Subsectors attractinginvestment include renewable energygeneration, ports and maritimeactivities and mobile telephony. n


A total of $81.6bn was committed toAfrica’s infrastructure develop-ment in 2017. The correspondingcommitment for 2016 was $66.9bn.The difference of $14.7bn, equiv-alent to a 22% rise, was largely dueto a $13bn increase in reportedChinese investments from $6.4bnto $19.4bn, and a $3.7bn increase inAfrican national and some sub-national government spendingfrom $30.7bn to $34.4bn.

African state spending on infra-structure, which for the first time in thisreport includes subnational statespending where it can be identified,increased from $30.7bn in 2016 to$34.4bn in 2017. Data for 2016 havebeen adjusted to include identifiedsubnational spending.

ICA members committed $19.7bn in2017, up from $18.6bn in 2016.Excluding the exceptional Power Africa

contribution of $7bn to 2013 figures,this is the highest figure reported byICA members since 2010 whencommitments of $29.1bn were reported.For 2017, no data were received fromthe EC for Infrastructure FinancingTrends in Africa. In the previous threeyears the EC committed an annualaverage of $822m to Africa’sinfrastructure development.

Chinese funding appears to be back in abig way, but the amounts of identifiedfunding from China vary substantiallyfrom year to year. The $19.4bn ofChinese funding in 2017 is similar tothe $20.9bn announced in 2015.However, it is substantially higher thanthe $6.4bn and $3.1bn reported in 2016and 2014, respectively.

Contributions from non-ICA bilateralsand multilaterals apart from Chinadecreased from around $3.1bn in 2016to $2.9bn in 2017. The main reason for

this decline is lower investments fromIndia.

The upward trend of ACG commit-ments in recent years appears to bedeclining. For example, commitmentsfrom the Arab funds dropped from$5.5bn in 2016 to $3bn in 2017.Commitments from non-ICA Europeandevelopment finance institutions (DFIs)and multilaterals increased signifi-cantly from $393m in 2016 to $1.6bn in2017. In 2017, private sector funding asreported on the World Bank’s PrivateParticipation in Infrastructure ProjectDatabase reached a low of $2.3bn.

The New Development Bank (NDB),the multilateral development bankestablished by the BRICS states,reported no commitments to Africa in2017. Africa50, the infrastructureinvestment platform established byAfDB, indicated that it would invest$8m in the Egyptian energy sector.n

2. Financing Trends

US

Canada

The Americas


ADFD SFDIDB KFAED OFIDAFESD BADEA

China

Japan

India

Asia

South Korea


Private sectorRegional development banksBOADDBSA TDB EBID

Europe

EU-AITF France UKEC Germany Non-ICAItaly

Multilateral development banksAfDB EIBWorld Bank IFC

1,043 597 500 449 181 119 97

3,364 5231,889

19

292

39 2,123 623

19,403

0

$mICA membersare shown inorange type

497 453 74

1,604838

2,361

704

10

6,993

34,345

14

89

2,324

2.1 Who is Financing Africa’s Infrastructure

Figure 7Reported andidentifiedfinancing flowsinto Africa’sinfrastructure,2017


Asia Privatesector

Multilateraldevelopment

banks

Europe ArabCo-ordination

Group

Regionaldevelopment

banks

Americas

Public external financing

2013 2014 2015 2016 2017

0

20

40

50

10

30

$bn

Total publicexternal financing

Transport Water Energy ICT Multi-sector Other Unallocated

24,000

$m

20,000

16,000

12,000

8,000

4,000

0

30,000

$m

25,000

20,000

15,000

10,000

5,000

0

35,000

Transport47.0%

Water16.5%

Energy30.8%

ICT 1.7%Multi-sector 1.4%Unallocated 2.5%

31.7%

15,8

94

7,11

5

6,4

58

3,2

96

9,1

77

2,18

3

1,0

01

8,7

64

11,0

46

5,78

4

5,4

19

3,4

60

1,56

2

69

3

5,12

4

23,2

48

11,8

64

5,6

54

4,4

12

1,3

47

7,4

42

(pri

vate

inve

stm

ent

onl

y)

9,9

83

9,4

42

6,4

62

5,52

8

2,13

4

140

2,55

5

2,899privatelyfinanced

7,000PowerAfrica

44.1

28.0

47.5

33.7

39933

4264

1,307

0

2254,052

26566

9

129

277933

215531

145

79

7,458

2,623

4,893

6,984

1,540

8,468

1,622

863

2,070

8,082

4,047

3,001

5,768

1,609

3,763

3,995

2,312

2,178

132

405

012489

7.0%38.5%

4.2%

18.4%

0.2%

27.0%

14.3%34.4%

21.7%

2.4%0.2%

51.2%

25.6%

19.0%

1.4%0.2%

2.7%

47.1%

4.6% 0.03%

13.1%

30.7%

4.3%

46.0%

26.6%

25.1%

0.9%1.5%

184

22,4

78

12,6

79

5,3

16

2,9

86

1,0

38

311

2,3

24

44.8

East Africa$15,796m

North Africa$15,875m

West Africa$22,010m

Central Africa$6,017m

Southern Africaexcluding RSA

$12,242mRSA

$8,694m

2013 2014 2015 2016 2017

Pan-African

RSA


East Africa

Central Africa

West Africa

North Africa

Total:34,041

13,178

24,777

2,269

5,132

0

2,169

Figure 8Sources offinance 2017,public externaland private

Figure 9Total 2017infrastructurecommitments bysector and region


Commitments from all sources toall sectors were higher in 2017than they were in 2016. Transportsector commitments increased themost from $26.2bn in 2016 to $34bnin 2017. This represents a 30%increase. Over the same periodcommitments to energy were upby 20%, from $20.6bn to $24.8bn.The corresponding increase incommitments to ICT was 37%, from$1.7bn in 2016 to $2.3bn in 2017. An8% rise in commitments to thewater sector from $12.2bn in 2016to $13.2bn in 2017 was the lowest ofall the sectors.

TransportFor the transport sector, commitmentsof $34bn in 2017 are more than the six-year annual average of $32.4bn.Commitments to this sector peaked in2013 when China announcedapproximately two-thirds of allinvestments, including $3.75bn tofinance the construction of theMombasa-Nairobi railway in Kenya,and $3.3bn towards the construction ofa railway linking the Ethiopian capitalAddis Ababa with Djibouti’s port-capital on the Red Sea. In 2017,Chinese investments in the sector were$3.4bn compared to $1bn in 2016.

ICA members’ commitments to thetransport sector peaked at $8.1bn in2017. The previous high was in 2010when members committed $6.9bn tothe sector. The annual eight-yearaverage of ICA members’ transportcommitments in the 2010-2017 periodnow stands at $5.6bn.

African state spending on transportreached $20.1bn in 2017, up by 23%from $16.3bn in 2016. However therewere wide regional variations. Forexample, transport spending in bothEast and Southern Africa increased bya little more than 50%.

WaterOverall commitments to the watersector from all sources increased by 8%from $12.2bn in 2016 to $13.2bn in2017. It is important to note that thereare wide regional differences in thechanges in these commitments. In thisregard, East Africa recorded thehighest increase with spending risingby 64% from $2.4bn in 2016 to $4bn in2017. There was little change inspending in South Africa, North Africaand Central Africa. Between 2016 and2017, water sector spending declined by28% in West Africa and by 14% inSouthern Africa.

In 2017, ICA members’ water sectorcommitments amounted to $4.6bn,slightly less than the $4.7bn reportedin 2016. Members’ average annualcommitments from 2010 to 2017 nowamount to $4.1bn. ICA membersreported water sector commitments of$3.2bn in 2015 compared with the$3.4bn in 2014 – substantially lessthan commitments of $5bn and $4.7bnin 2013 and 2012, respectively.

In 2017 China committed $1.8bn, ofwhich $1.5bn is for the construction ofthe Gerbi Dam in Ethiopia to providewater to Addis Ababa.

African state spending in the watersector declined by 3% from $6.1bn in2016 to $5.9bn in 2017. In the sameperiod, Central African stateallocations declined by 67 %, from$379m to $123m. In Southern andNorth Africa spending declined by 28%and 16 %, respectively. The only regionthat saw substantially increased stateallocations was West Africa. Itsspending increased by 29%, from$496m in 2016 to $641m in 2017.

EnergyOverall commitments from all sourcesto energy increased by 20%, from$20.6bn in 2016 to $24.8bn in 2017.

2.2 Financing Trends by Sector

Transport Water Energy ICT Multi-sector Other Unallocated

35,000

0

$m

30,000

25,000

20,000

15,000

10,000

5,000

20,117

8,125

4,607

1,945

5,773

1,306

593

1,126

9,046

n.a.n.a.

n.a.n.a.

n.a.

2,169

5280

5250

4,075

3

6180

10

1,051

600

1,267

7833,390

360

5,581

1,841

5,876

19243


Private sector


China


ICA members

Total:34,041

13,179

24,777

2,269

5,132

0

2,169

Figure 10Total 2017infrastructurecommitments bysector and source


During the same period, Southern Africa energycommitments in Southern Africa increased by 137%, from$1.6bn in 2016 to $3.8bn in 2017. Between 2016 and 2017,North and West Africa increased their energy sector fundingby about 50% each. For Central Africa, the corresponding risein energy commitments was 14%. On the other hand, inSouth Africa commitments to the energy sector decreased by4 %. Commitments to the energy sector in East Africadeclined substantially, by 42%.

ICA member commitments to energy declined from $7.7bnin 2016 to 5.8bn in 2017, the lowest level since 2013 when$5.7bn of commitments were reported. Members’ annualcommitments over the eight-years from 2010 to 2017averaged $7.5bn. Energy commitments from memberspeaked in 2010, due to large commitments to North Africaand the Eskom Investment Support Project for SouthAfrica.

African state budget allocations to the energy sectorincreased by 26%, from $4.4bn in 2016 to $5.6bn in 2017.The highest increase was in Southern Africa whereallocations doubled from $1.1bn in 2016 to $2.2bn in 2017.Allocations remained reasonably steady in West and EastAfrica and South Africa. In Central Africa, energy sectorallocations declined by 9%.

ICTICT commitments increased by 37%, from $1.7bn in 2016 to$2.3bn in 2017. The commitments in 2014 and 2015 were$2.3bn and $2.5bn, respectively.

ICA member commitments in 2017 amounted to $618m, upfrom $417m in 2016. This is close to the amount of $600mreported in 2015. Over the last eight years and after fallingto very low levels in 2011 and 2012, average annual ICAmember commitments to ICT infrastructure stand at $392m.

Between 2012 and 2016, Chinese average annual funding ofICT infrastructure amounted to just $339m. In 2017, Chinaannounced ICT investments of $1.1bn. African statespending on ICT declined by 33% to $600m in 2017 comparedwith $894m in 2016. Spending by Central and SouthernAfrican governments declined by 70% and 89%, respectively.East Africa allocated 159% more to ICT in 2017 than it did in2016 while North and West Africa reported increases inbudget allocations of 70% and 25%, respectively. During thisperiod, South Africa reported an 11% increase in ICTallocations.n

Transport Water Energy ICT Multi-sector

2013 2014 2015 2016 2017

2013 2014 2015 2016 2017

90

80

70

60

50

40

30

20

10

0

30

20

10

0

$bn

30

20

10

0

$bn

$bn

37.334.2

7.5

13.2

34.0

24.8

2.3

5.1

2.2

32.4

11.2

9.4

33.524.1

28.6

1.92.32.0

2.4

2.6

2.7 2.42.21.0

5.3 3.66.8

5.0

13.0

0.41.5

3.4

9.2

0.52.2

3.2

8.6

0.60.6

8.1

4.6

5.8

0.60.5

12.2

26.2

20.6

1.72.8

3.4

5.0

4.7

7.7

0.40.8

Transport Water Energy ICT

Multi-sector Other/unallocated

75.478.9

81.6

32.8

10.7

26.3

2.1 3.0

18.8 19.8 19.7

Total:83.3

66.9

Total:25.3

18.6

Figure 11Total infrastructure financing by sector, 2013-2017Figure 12ICA member commitments by sector, 2013-2017 (middle)Figure 13Average annual total infrastructure financing by sector, 2013-2017 (bottom)


Of the $81.6bn total financingcommitments from all sources toall infrastructure sectors in 2017,West Africa accounted for $22bn,North Africa $15.9bn, East Africa$15.8bn, Southern Africa $12.2bn,South Africa $8.7bn and CentralAfrica $6bn. Intraregional andpan-African commitments totalled$934m.

Central Africa is a concern because itwitnessed a decline in funding from$7.9bn in 2016 to $6bn in 2017.Funding for the region had been on anupward trend reaching $8.3bn in 2014but falling to $4.9bn in 2015. Thedecline is attributed mainly toreduced budget allocations by theregion’s federal governments.

West Africa had the highestcommitments in 2017 of $22bn, about27% of all infrastructure investmentsin Africa. The region’s leading positionis largely due to Chinese funding of11.5bn ($2.3bn in 2016), of which$5.8bn is for the 3,050MW Mambillahydroelectric power project in Nigeria.ICA member funding for the regionamounted to $4.9bn ($4.6bn in 2016).Both state funding and ACG

commitments to West Africa weresubstantially reduced. State fundingfell from $4.9bn in 2016 to $3.6bn in2017. ACG commitments declinedfrom $1.5bn to $795m in the sameperiod.

West Africa has also experienced asignificant decline in private sectorinvestment to just $704m in 2017. In2013 private investments of $5.4bnwere reported. The private sectorinvested $1.3bn in 2015 and $1.5bn in2016.

East Africa reported commitments of$15.8bn in 2017, 23% higher than the$12.9bn reported in the previous yearbut substantially lower than the five-year high of $23.7bn reported in 2013when Chinese funding of majorrailway projects in Kenya andEthiopia were announced. Fundingfrom China amounted to $9.3bn in2013 whereas in 2017 the Chineseannounced financing of $4.5bn.

State spending in East Africa at$8.4bn is the highest in the last fiveyears during which budget allocationshave amounted to between $5.6-7.3bn.ICA members’ funding of $4bn is a

little lower than the five-year annualaverage of $4.4bn.

With commitments of $15.9bn, NorthAfrica reported the highest level ofcommitments since 2014 when itreceived commitments of $23.2bn.Average annual commitments overthe last four years amount to $16.1bn.Investments in 2017 were bolsteredby strong private sector interestbacked by DFI support for the Benbansolar project in Egypt. State spendingof $6.5bn in 2017 was the most theregion has committed in the last fiveyears.

Southern Africa’s commitments for2017 of $12.2bn is almost double the$6.5bn reported in the previous year.But 2016 was a year withexceptionally low commitments. From2013 to 2015 commitments averaged$15.4bn. Over the past five years,state funding has declinedconsiderably in the region, from $12bnin 2013 to $6.2bn in 2017, althoughthe latest figure is an increase on the$4.7bn reported in 2016. ICAmembers’ commitments of $3.8bn tothe region in 2017 are the strongest inthe last five years over which the

2.3 Financing Trends by Region

NorthAfrica

WestAfrica

CentralAfrica

EastAfrica


RSA Pan-African

24,000

0

$m

20,000

16,000

12,000

8,000

4,000

6,522

1,555

3,654

11,474

4,886

704

3,620

2,926

1,855

4,092

6,196

8,382

2,739

6,694

495

3,769

795

936

0

530

528

51

8990

350

0

n.a.

50

1,447

1,137

1,559

94156

6

58

1,307591

1,500 00

321


Private sector


China


ICA members

Total:15,875

22,010

6,017

15,796

12,242

8,694

934

Figure 14Total 2017infrastructurecommitments byregion and source


average annual amount committed is$2.3bn. ICA members’ commitmentsamounted to $1.4bn in 2016.

In the Republic of South Africacommitments to infrastructure amountedto $8.7bn. This amount is about the sameas the $8.6bn committed in 2016.However, South Africa’s infrastructurespending is variable compared with otherregions of Africa. The main reason is thatit is significantly buoyed by private sectorinvestment in years when it holdssuccessful Renewable Energy Inde-pendent Power Producer Procurement(REIPPP) programme auctions. Over thelast five years, South Africa has recordedinvestments as low as $4.9bn in 2014which was followed by $11.7bn in 2015.The country has also attracted significantamounts of Chinese funding ($2.2bn in2015 for example) which in mostcountries tends to cause a spike incommitments, for instance its above-mentioned multi-billion dollar funding ofKenyan and Ethiopian railways,Ethiopia’s Gerbi dam and Nigeria’sMambilla power plant.n

2013 2014 2015 2016 2017

2

90

80

70

60

50

40

30

20

10

0

$bn

$

7.5

23.3

15.912.4

21.7

11.7

13.6

22.0

6.0

4.7

8.3

4.8

23.711.4

18.8

15.8

12.2

15.6

14.4

16.2

7.8

1.6

4.9

1.4

11.7

2.28.7

0.9

12.9

16.4

7.9

13.1

6.5

8.6

1.4

NorthAfrica

WestAfrica

CentralAfrica

EastAfrica

RSASouthern Africaexcluding RSA

Pan-African

75.478.9

81.6

1

Total:83.3

66.9

2013 2014 2015 2016 2017

P

$bn

30

20

10

0 2.4

8.5

2.4

6.9

2.51.11.4

5.1

3.4

3.7

2.02.01.51.1

4.1

4.0

1.3

4.7

1.81.72.2

3.7

4.9

1.9

4.1

3.80.50.9

3.7

4.6

2.2

4.4

1.41.01.4

18.8 19.8 19.7

1

Total:25.3

18.6

T

NorthAfrica

WestAfrica

CentralAfrica

EastAfrica

SouthernAfrica

excl. RSA

RSA Pan-African

$bn

20

10

0

14.417.1

6.3

16.6

13.0

8.3

1.5

TFigure 15Total infrastructure financing by region, 2013-2017

Figure 16ICA member commitments by region, 2013-2017

Figure 17Average annual total infrastructure financing byregion, 2013-2017


This chapter looks at theinfrastructure financing gap,which is defined as the differencebetween the amount needed todevelop Africa’s infrastructure andthe amount actually invested ininfrastructure development

Recent estimates have suggested thegap ranges from $68bn to $108bn1 (seepage 21). As a result, closing this gaphas, for many years, been given a highpriority in many African countries.

The objective of this chapter is to shedlight on the magnitude of Africa’sinfrastructure financing gap, whichcan in part be attributed to a shortageof bankable projects rather than a lackof funds for investment.

3. Strategic Trends

3.1 Overview

1 AfDB’s African Economic Outlook, 2018

Effective institutional arrangementsare needed to expand the number andvariety of sources of investment forthe infrastructure sector. In thisregard, countries that have createdconducive political, regulatory andlegislative environments haveattracted investors. However, fluc-tuations in levels of financing persector in the past few years suggestthat Africa’s infrastructure develop-ment is uneven.

The RECs and Regional Power Pools(RPPs) are playing key roles infacilitating the development ofinfrastructure. This is the case withtheir support for PIDA/PAP. Asexpected, these regional bodies alsofocus on their own regions. The

analysis in this chapter deals with thefinancing needs and actual amountscommitted to two RECs.

It is important to note thatinfrastructure development thatspreads evenly across the continent ismore important than ever if theanticipated African Continental FreeTrade Area (AfCFTA) is to besuccessfully established.

Africa’s RECs and RPPs aredemonstrating a continental impact.For example, as discussed in thischapter, regional projects such asthe Zambia-Tanzania-Kenya Intercon-nector have a high potential tocontribute to the development of thecontinent’s infrastructure.n


3.2 Infrastructure Financing Gap

2012 2013 2014 2016 20172015

Six-year average commitments to 2017

80

70

60

50

40

30

20

10

$bn

0

90

160

140

120

100

80

60

40

20

$bn

0

180

30.134.2

7.5

13.2

34.0

24.8

2.3

5.1

2.2

32.4

11.5

9.4

33.524.1

28.2

1.3

3.01.1

2.4

2.6

2.7 2.4

2.21.0

12.2

26.2

20.6

1.7

2.8

3.4

37.3

11.2

28.6

1.9

2.32.0

Financing need (high) African Economic Outlook

Financing need (low) African Economic Outlook

High case scenario

47

35

32

11

27

2

32

45 Minimum financing gap

66

56

3

15

55 Maximum financing gap

50

35

8

27

7

45 2

Financing needshortfall

84%

81% Low case scenario

31%

8%

47%

24%

72%

50%

Transport Water Energy ICT

Multi-sector Other/unallocatedOther/unallocated

Multi-sector

ICT

Energy

Water

Transport

75.478.9

81.6

Total:75.1

66.9

83.3

26.6

Six-year average

2.1

3.0

2.0

10.8

32.4

Recent estimates by the AfDBpublished in its African EconomicOutlook, 2018 reveal that Africa’s annual infrastructurerequirements amount to $130bn–$170bn with a financing gap inthe range of $68bn–$108bn. Thatfigure is higher than the financial gapof $93bn which was presented in 2010in a World Bank publication, Africa’sInfrastructure: A Time for Trans-formation.

However, the AfDB’s recent estimatescorrespond closely with an estimateprovided in Africa’s Infrastructure

Deficit: Closing the Gap, a backgroundpaper presented at the AfricaEmerging Markets Forum in Abidjanin March 2017. The papercommissioned by Japan InternationalCo-operation Agency (JICA) supposedthat 5-6% of GDP should be spent oninfrastructure, suggesting spending of$120bn is required against actualexpenditure of $84bn, a figure derivedfrom Infrastructure Financing Trendsin Africa, 2015. The JICA comm-issioned paper highlighted thatcurrent annual spending needs areestimated to be $120bn. The samepaper advocates stakeholders creating

conducive investment conditions forprivate sector financing, both fromdirect investors and from institutionalinvestors who manage pension fundsand insurance assets.

The financing needs by sectors whichare derived from the estimates in theAfDB’s African Economic Outlook,2018 are presented in Figure 18,above.

However, Figure 19 shows averagecommitments based on ICA data forthe last six years to 2017 of $77bn. Ittherefore suggests a slightly narrower

Figure 18 Infrastructure financing needs by sector, according to AfDB’sAfrican Economic Outlook, 2018

Figure 19 Average annual commitments by sector 2012-2017 (based onICA research and annual reports)


Infrastructure Financing Gap

financing gap than that provided inAfrican Economic Outlook, 2018 whichuses the figure of commitments from allsources of $62.5bn from InfrastructureFinancing Trends in Africa, 2016.Commitments in 2016 were the lowestin recent years. Figure 18 thereforesuggests an annual financing gap over2012-17 in the $53bn-$93bn range.

It is clear from the table above that theinfrastructure financing gap is wider insome sectors than others. In thisregard, the water sector faceschallenges in terms of filling thefinancial gap. This is because of the factthat it is 81-84% short of its annualfinancing requirement. On the otherhand, given its annual financing needof $35bn, the transport sector is just 8%short of its financing requirement,which is relatively negligible.

The recapitulation in Figure 19 of sectortrends reported in InfrastructureFinancing Trends in Africa, 20171 overthe 2012-17 period shows there hasbeen no marked change in sector trendsover recent years. However, there havebeen significant spikes, mostly as aresult of a few large commitments froma variety of sources. Commitments in2014 were boosted by one of the largestever, the $8.4bn raised via investmentcertificates sold to Egyptian citizens forthe Suez Canal expansion. In 2013 theprivate sector committed a largeamount of $4.6bn, mostly to twoNigerian transport projects –the Onne

Infrastructure Financing Needs by Sector

($bn unlessotherwiseindicated)

FinancingNeed (Low)*

FinancingNeed (High)*

Six YearAverage

Commitmentsto 2017**

MinimumFinancing Gap

MaximumFinancing Gap

% FinancingNeed

Shortfall (Lowcase

scenario)

% FinancingNeed Shortfall

(High casescenario)

Transport 35 47 32 3 15 8% 31%

Water 56 66 11 45 55 81% 84%

Energy 35 50 27 8 23 24% 47%

ICT 4 7 2 2 5 50% 72%

Multi-sector - - 3 -3 -3 - -

Other - - 0 0 0 - -

Unallocated - - 2 -2 -2 - -

Total 130 170 77 53 93 41% 55%

1 Due to the availability of new data, the 2016 figure has been restated as $66.9bn in InfrastructureFinancing Trends in Africa, 2017 from the $62.5bn reported in Infrastructure Financing Trends inAfrica, 2016.2 The South African Renewable Energy Independent Power Producer Procurement Programme: Areview and lessons learned, Anton Eberhard & Raine Naude, 2016

Port expansion ($2.9bn) and Lekki DeepSeaport ($1.5bn). Transport com-mitments in 2013 were boosted byChina’s $3.75bn towards the Mombasa-Nairobi railway and $3.3bn towards therail link between Ethiopia’s capital,Addis Ababa and Djibouti’s port-capitalon the Red Sea. Energy sectorcommitments in 2015 were boosted byChina’s $4.3bn to the Caculo Cabaçohydro project in Angola and in 2010 by$12.9bn from ICA members targetedpower projects in North Africa andSouth Africa. The REIPPP programmeintroduced in South Africa in 2011attracted $20.5bn in its first four years,more than independent powerproducers invested in the rest of Sub-Saharan Africa over the past 25 years2.

Effective InstitutionalArrangementsInterpreting Africa’s infrastructurefinancing gap should go beyond statingfunding shortfalls. Stakeholdersinterviewed for InfrastructureFinancing Trends in Africa, 2017confirm that the financing gap is notnecessarily a product of a lack of fundsand suggest that funds for Africa’sinfrastructure development areavailable. The challenge, however, isfinding bankable projects.

Lucy Heintz, head of renewables atgrowth market private equity investor,Actis, notes elsewhere in this reportthat there are now several successfulprivate energy investments across thecontinent (see page 66). She points tocountries where independent powerproducer frameworks are wellunderstood with an increasing amountof installed private capacity now includeSenegal, Ghana, Kenya, Mozambique,Senegal and South Africa.

If more countries presented effectiveinstitutional arrangements then theprospects for more investments wouldmost likely improve. In his foreword tothe African Economic Outlook, 2018AfDB Group President AkinwumiAdesina sums up what is needed:

“To take advantage of the greatpotential for infrastructure dev-elopment, governments will have to putin place effective institutionalarrangements to manage the complextasks of project planning, design,coordination, implementation, andregulation,” he said. Adesina suggeststhat governments should also focus onthe soft side of infrastructuredevelopment, by addressing policy andregulatory issues and training teams todevelop financing packages.

* African Economic Outlook ** Infrastructure Financing Trends in Africa, 2017


Private sector finance is available forprojects presenting conducive political,regulatory and legislative environ-ments. This is the experience in severalcountries, notably in the ports, energyand telecoms sectors.

A conducive environment has beencreated in South Africa’s REIPPPprogramme to attract private sectorinvestment in the energy sector. It hasdeveloped a sound procurement policyand the government has shown itsability to manage an effective biddingprocess that stimulates competitivebidding.

Egypt has also demonstrated howinnovative financing solutions can workwith $8.4bn Suez Canal funding viainvestment certificates bought byEgyptian citizens in 2014. In 2017,Cairo again showed how to createconducive investment conditions forpublic and private investors inrenewables with the Benban SolarPark, which raised $1.98bn, of which$513m was private investment (seepage 67).

Types and Sources of FinanceIncreasingly sophisticated applicationsof financing techniques are extendingthe range of financing instrumentsavailable and enabling investors to stepinto gaps not filled by conventionalfunders.

New funders broadening the pool offunds can also help. In its report

entitled African Economic Outlook,2018, the AfDB points out thatinstitutional investors such asinsurance companies, pension funds,and sovereign wealth funds have morethan $100trn in assets undermanagement globally. A fraction of theexcess global savings and low-yieldresources would be enough to fillAfrica’s financing gap and financeinfrastructure projects. Again, effectiveinstitutional arrangements would bepreconditions for these types ofinvestors.

Another source that has the potential toclose the financing gap are found inillicit financial flows. According to theOrganisation for Economic Co-operation and Development (OECD)report entitled Illicit Financial Flows,the Economy of illicit trade in WestAfrica (February, 2018), such flows costAfrican countries at least $50bn everyyear, more than the total sum ofdevelopment aid the continent receives.Estimates by the high-level panel of theUnited Nations Economic Commissionfor Africa (UNECA), indicate that illicitflows – often the result of undervaluedresource exports or failure to collecttaxes – have been increasing since thestart of the century, when they stood atless than $20bn. A joint report by theAfDB and US-based research andadvocacy group Global FinancialIntegrity (GFI) entitled Illicit FinancialFlows and the Problem of Net ResourceTransfers from Africa: 1980–2009 also

found that cumulative illicit outflowsfrom the continent over the 30-yearperiod ranged from $1.2trn-1.4trn.

If governments captured revenuecurrently lost through illicit financialflows, it would bolster their funds forinvestments in infrastructure. TheAfDB/GFI report states that addressingillicit financial flows can benefit thedevelopment of infrastructure directlyby providing additional funds. It alsorecognises that the reduction in illicitfinancial flows would create a moreattractive environment for investors ininfrastructure. In addition, the reportstates that policies aimed at boostingrecorded inward transfers generallyinvolve measures that improve acountry’s business climate, rangingfrom political and economic stability tospecific business-friendly measures.

In its report Base erosion and profitshifting in Africa: reforms to facilitateimproved taxation of multinationalenterprises UNECA says that illicitfinancial flows hamper the developmentof infrastructure. The report coversexploitation by multinational enter-prises of unsynchronised tax rules thathave not kept pace with modernbusiness models thus eroding the taxbases of African countries and shiftprofits to low-tax jurisdictions. Thereport concludes “the result is reducedgovernment tax revenue and a criticalunderfunding of public investment andinfrastructure that could help topromote economic growth”. n

Commitments from All Sources, Six Year Trend ($bn)

2012 2013 2014 2015 2016 2017 Average

Transport 30.06 37.26 34.24 32.36 26.24 34.04 32

Water 11.53 11.20 9.38 7.54 12.22 13.18 11

Energy 28.18 28.60 24.06 33.52 20.62 24.78 27

ICT 1.30 1.91 2.39 2.38 1.66 2.27 2

Multi-sector 2.97 2.26 2.61 2.15 2.77 5.13 3

Other 0 0 0 0 0.48 0 0.1

Unallocated 1.07 2.03 2.74 0.97 2.91 2.17 2

Total 75.11 83.26 75.42 78.92 66.90* 81.571 As restated in Infrastructure Financing Trends in Africa, 2017


The March 2018 agreement toestablish the African ContinentalFree Trade Area is a landmarkmoment in the continent’sambition to boost intra-Africantrade and spur on economicdevelopment. However, policymakers are keen to point out thatimprovements in infrastructureare vital to achieving these goals.

Africa has long strived to increasetrade cooperation through a variety ofinitiatives that have included thecreation of RECs and inter-regionalfree trade zones. But the 21 Marchsigning of the African ContinentalFree Trade Agreement at theextraordinary Summit of theAssembly of the AU in Kigali isexpected to have a transformativeeffect on the continent.

The AfCFTA initiative is intended tocreate a single continental market forgoods and services, with the freemovement of investment. AfCFTAalso allows the free movement ofbusiness people – leading to theestablishment of a continentalcustoms union.

With the implementation of AfCFTA –which will come into force once theparliaments of 22 of the 49 signatoriesratify the agreement – Africa willemulate many of the objectives andfeatures that underpinned theEuropean Union (EU)’s creation.

A 2012 study by UNECA suggeststhat intra-African trade couldincrease by as much as 52.3% by 2022,compared with a 2010 baselinescenario, as a result of a continentalfree trade area. This forecast assumeda predicted AfCFTA formation in 2017and the full implementation ofscenarios in 2022.

A report prepared by UNECAEconomic Affairs Officers, SimonMevel and Stephen Karingi, entitledDeepening Regional Integration inAfrica: A Computable GeneralEquilibrium Assessment of theEstablishment of a Continental FreeTrade Area followed by a ContinentalCustoms Union indicates that growthin intra-African trade would be drivenby increased exchanges within thecontinent in three sectors: agricultureand food, industry and services.

However, the UNECA report notesthat poor infrastructure, particularlyin the transport sector, is a constrainton intra-African trade growth in thesekey sectors.

Several policymakers have underlinedthis point, suggesting that the successof AfCFTA is dependent on Africa’sability to create and sustain theinfrastructure needed for goods toflow freely across the continent.

During an AfCFTA-themed round-table at UNECA’s Conference ofAfrican Ministers of Finance,

Planning and Economic Developmentin May 2018, the session chairpersonSenegalese Finance Minister AmadouBa acknowledged that there waspolitical will for integration but thatinvestment in infrastructure wouldneed to be given priority.

Association of Nigerian Traderspresident Ken Ukaoha noted thattransport links may prevent intra-African trade from taking off in theway that AfCFTA envisages.

Successfully cultivating intra-Africantrade may be contingent ontranslating this enthusiasm for a newfree trade area into tangibleimprovements to roads, railways andairports. This requires closing theinfrastructure financing gap byenabling more bankable projects towiden the availability of funds.

Whether AfCFTA can build on thesuccess achieved by some of theexisting RECs, and overcomechallenges that have disappointedpast efforts, may be determined bywhether investors can match risingambitions with concrete investmentsto develop the continent’s infra-structure.

Nevertheless, the signing of theAfCFTA agreement highlights theneed for African and internationalinvestors alike to help the continentachieve its goals of economicprosperity and sustainability. n

3.3 Intra-African Free Trade


Regional Economic Communitiesand Regional Power Pools playcatalytic roles in the developmentof not only regional projects butalso in connecting Africa’s regionswith each other.

In general, bringing African countriestogether to fully leverage and addvalue to Africa’s resources andcapabilities is critical for thecontinent. Therefore, continentalconnectivity of Africa’s infrastructurewill be an essential foundation for thedevelopment of AfCFTA.

The RECs and RPPs are alreadyplaying key roles in facilitatingprojects in another continental vision,the PIDA Priority Action Plan andseveral projects could be highlightedto show that progress towardsintegrated African infrastructure isbeing made.

Regional ActionOne PIDA/PAP project with acontinental impact advancing apace isthe Zambia-Tanzania-Kenya (ZTK)power transmission interconnectorproject. It provides a good example ofa project that must be executed byseveral domestic and regional actorsthat will ultimately have a continentalimpact. ZTK is also supported byDFIs, including AfDB, EIB, JICA andWorld Bank.

Participating regional organisations inZTK include the East AfricanCommunity (EAC, lead REC), CommonMarket for Eastern and SouthernAfrica (Comesa, participating REC),Eastern Africa Power Pool (EAPP,sectoral organisation), NEPAD Plan-ning and Coordinating Agency (NPCA,continental co-ordinator), SouthernAfrican Development Community(SADC, participating REC) as well asthe national organisations that must

3.4 ZTK Interconnector

Maghreb Electricity Committee(Comelec)

West African Power Pool (WAPP)

Central African Power Pool (CAPP)

Eastern Africa Power Pool (EAPP)

Southern Africa Power Pool (SAPP)

Countries which are members ofmore than one Regional Power Pool:Angola: CAPP & SAPPBurundi: CAPP & EAPPDemocratic Rep. of Congo: CAPP, EAPP & SAPPLibya: Comelec & EAPPTanzania: EAPP & SAPP

Withdrew fromEAPP Feb 2016

ZTK InterconnectorANGOLA

SOUTHAFRICA

MADAGASCAR

BOTSWANA

ZIMBABWE

ZAMBIA

LESOTHO

MALAWI

TANZANIA

KENYAUGANDA

RWANDABURUNDI

GABON

NAMIBIA

DJIBOUTI

ERITREASUDAN

CHAD

NIGER

EQUAT. GUINEASÌO TOM� & PRêNCIPE

CAMEROON

MALI

ALGERIALIBYA

EGYPT

TUNISIA

MOROCCO

MAURITANIA

MAURITIUS

SENEGALGAMBIA

GUINEA BISSAU GUINEA

SIERRA LEONE

LIBERIA

CïTEDÕIVOIRE

BENIN

MO

ZAMBIQ

UE

BURKINAFASO

GHANA NIGERIA

SEYCHELLES

ETHIOPIASOUTHSUDAN

CAPEVERDE

CO

NG

O

TOGO

Western Sahara (under UN mandate)

CENTRALAFRICAN REP.

DEMOCRATICREPUBLIC

OF CONGO

COMOROS

SOMALIA

ESWATINI(SWAZILAND)

R�union (Fr.)

Mayotte (Fr.)

view the project in regional andcontinental contexts.

Continental Impact

The three RECs involved in theproject also see the ZTK from a wider,continental perspective. The SADCregion’s electricity sector is not fullyintegrated because Angola, Malawiand Tanzania are not connected to theregional power grid. This means thatany new generation capacity installedin any of the three countries cannot berealised by the nine other SAPPmembers – Botswana, DemocraticRepublic of Congo (DRC), eSwatni

(formerly Swaziland), Lesotho,Mozambique, Namibia, South Africa,Zambia and Zimbabwe. Conversely,capacity installed in the larger groupof countries is not realised by Angola,Malawi and Tanzania. The ZTK willhelp remedy this regional situation.

Beyond the regional benefits, ZTKwill connect SAPP and EAPP and willenhance inter-regional electricitytrading by interconnecting the EAPPand SAPP grids. This will create thelargest power pool on the continentand will be an essential component ofthe North-South (Cape to Cairo)power transmission corridor. n

Regional Cooperation, Continental Impact

Figure 20ZTK Interconnector and regional power pools


Regional Economic Communities and Regional Power Pools that have provided data for the first time forInfrastructure Financing Trends in Africa, 2017 are the East African Community, Economic Community ofCentral African States, Southern African Development Community and the Southern African Power Pool.This section compares the infrastructure spending requirements of two of the RECs – East AfricanCommunity and Southern African Development Community – with the ICA’s data on commitments. Directcomparisons between the RECs’ and ICA data cannot be drawn but the data provide indicators of themagnitude of the financing gaps in different sectors and areas.

3.5 Regional Economic Communities and Power Pools

East African Community

EAC

In its paper entitled Heads Of StatePriority Infrastructure ProjectsImplementation Progress And StatusUpdates, the EAC states that it hasidentified 286 priority infrastructureprojects and programmes that willrequire an investment amounting to$78.7bn over the next 10 years to 2028and beyond. Amongst these are 17large‐scale and high-impact regionalintegration projects and programmeswith an estimated financing need of$61.2bn. Excluding two $4bn projectsthat fall outside the ICA’s definition ofinfrastructure, this gives the EAC afinancing need of $53.2bn for these 17projects. Some of these financingneeds have been met, and someprojects or parts of larger projectshave been completed.

Commitments for the six EACcountries from all sources according to

ICA data amounted to $10.3bn in2017 and $9.89bn in 2016, figures thatexcludes commitments made to aregion rather than a specific country.

The EAC is making progress with itsproject portfolio according to analysispresented by the community’sInfrastructure Directorate. It says atotal of 24 projects out of 40 projectsat concept stage in 2014 moved tovarious stages of preparation andimplementation while 14 projectswere completed between November2014 and November 2017 as indicatedin the table below. A total of 12projects obtained financing while 55are under construction and thetendering process is ongoing for 42projects.

But the EAC recognises that projectpreparation and implementationremain the main challenges

hampering a faster delivery ofinfrastructure projects. The persistentchallenges include financial andcapacity constraints. Many projects(146) are under different stages of thepreparatory phase and requirefunding to move them to next phases.The implementation status by stagesof development for the priorityprojects as of November 2017 is asindicated in Figure 21, below.

Nevertheless, the EAC Secretariat ispressing on to create more or betterregional infrastructure. For instance,it is packaging to bankability 36shortlisted infrastructure projectsbased on their relative attractivenessfor private and public sector invest-ment. This process is expected to leadto the development of a CorridorDevelopment Investment Plan and amarketing plan to develop andimplement projects in the transport,energy, transboundary water andICT sectors. According to DavidNiyonsenga, EAC’s InfrastructureExpert, “once the packaging iscompleted, those projects will bepresented for pre-market sounding toleverage the interest of investors. n

Railways

PortsRoads

Generation

Transmission

Electrificatio

n

Pipelines

Refineries

Civil aviatio

n

0

120

20

40

60

80

100

Number

0

2

46

75

2 1

64

14

6

0

43

69

372

17

24

14

1110

65

82

0

7

18

3

0

0

010010

0310322

5144002

Dropped 4

Dropped 1

0323251

2

Stage 4C: operation

Stage 4B: construction

Stage 4A: tendering

Stage 3B: financing obtained

Stage 3A: FS & DD

Stage 2: FS & PD

Stage 1: Concept

Total:26

42

109

1633

16 13 2 30

Source: Heads Of State Priority Infrastructure Projects Implementation Progress And Status Updates,paper prepared by the EAC Infrastructure Directorate, February 2018

Figure 21 Implementation status of EAC priority projects, Nov 2017


EAC Projects Completed (Nov 2014-Nov 2017)Phase I: Construction of the Mombasa–Nairobi StandardGauge Railway line (472km)

Construction of the Musoma (Makutano)–Sirari/Isebania road (83km)

Construction of the Makebuko–Butaganzwa road (21km)

Upgrading the secondary access road Kifuru – Kinyerezi –Stakishari (Banana)

Upgrading of the Mbezi Shule–SamakiWabichi (Mbezi Beach/TangiBovu) road.

Upgrading of the Kawawa Roundabout–Msimbazi–Twiga(Jangwani) road (2.7km)

Upgrading of the Kigogo–TabataDampo road (1.6km)

Upgrading of the Kibamba–Kisopwa road (Kibamba–Mloganzilasection; 4 km)

Construction of road between Simiyu/Mara border–Musomaroad (85.5km)

Construction of the Mugina–Nyanza Lac Road (45km)

Mombasa Port Strengthening: 2nd Container Terminal –(Kipevu West): Phase I

Development of Lake Nyasa Ports: Ndumbi Ports

Construction of the Sinendet to Kisumu 10-inch diameterpipeline (120km)

Mtwara-Kilwa/Somanga-Dar es Salaam gas pipeline

Southern African Development Community

SADC

Infrastructure was a central focus forthe SADC in its high profile 2018meeting that brought together theleaders of member states and seniorrepresentatives from all 16 countriesin the community.

Promoting Infrastructure Developmentand Youth Empowerment forSustainable Development was thetheme chosen for the community’sAugust 2018 Summit of Heads ofState and Government and SADCCouncil of Ministers meetings, inWindhoek, Namibia. The theme buildson the focus of the past four SADCsummits, which addressed industrialdevelopment issues.

The summit discussed progresstowards implementation of the SADCRegional Infrastructure DevelopmentMaster Plan (RIDMP), which ispivotal to the socio-economic growth ofthe region, including the indus-trialisation agenda. The RIDMP is theregion’s strategy for the developmentof integrated regional infrastructureto meet projected demand by 2027.

The RIDMP specifies funding needs of$63.8bn for selected infrastructureprojects only for the period 2012-17 ina short-term action plan. That figuresuggests an annual funding need of$12.8bn. In comparison, ICA datarecords total commitments for SADCmember states (excluding regionalcommitments) of $20.7bn in 2017 and

$10.7bn in 2016, the wide differencebeing the result of more infrastructurespending, often substantially more, inevery single member state in 2017compared with 2016.

The RIDMP contains longer term 15-year financial needs forecasts for theperiod 2012-27. For projects andprogrammes identified in the plan,the SADC forecasts a financialrequirement of $176bn for energy and$100bn for transport projects.

That equates to an average annualannual requirement of $11.7bn for theenergy sector. This compares with ICAdata that shows total commitmentsfrom all sources for the energy sectorto SADC member states (excludingregional commitments) of $6.3bn in2017 and $3.1bn in 2016.

The RIDMP suggests the averagetransport sector financial requirementto meet the needs of the plan is$6.6bn. This compares with ICA datathat shows total commitments fromall sources for the transport sector inSADC member states (excludingregional commitments) of $9.1bn in2017 and $4.8bn in 2016.

South Africa’s President CyrilRamaphosa made clear in keynoteaddress to the Windhoek summit asSADC outgoing chairperson that apipeline of bankable projects is key to infrastructure development, and

why infrastructure development isessential for the region’s industrialstrategy.

“The ability of SADC countries toestablish a competitive industrialsector and promote greater industriallinkages has been hindered by thelack of infrastructure in areas such asenergy, transport and commu-nications,” he said.

Regional cooperation in the develop-ment of infrastructure will lowertransaction costs, enhance regionalmarkets and make production andexports more competitive. Investmentin infra-structure must therefore be acentral priority. Through our jointefforts, the region has now establisheda healthy pipeline of bankable projects,which we now need to see through tocompletion,” Ramaphosa concluded.n


In 2017, ICA members committed$19.7bn to Africa’s infrastructure,an increase of 5% from the$18.6bn recorded in 2016. Thisrepresents one of the highestcommitment amounts since theICA began collecting data in 2010,and is marginally below the 2015high of $19.84bn.

Actual commitments are likely to beeven higher given that the EC, whichhas historically committed over $1bnon average per year between 2012 and2016, had not supplied data for 2017at the time of publication.

In 2017, there was a significant shiftin commitments by sector compared toprevious years (see Figure 22). Forexample, for the first time since 2011,ICA members provided morefinancing for transport infrastructurethan the energy sector. Commitmentsto the transport sector, whichamounted to $8.1bn, increased by 63%from the previous year. It alsorepresented 41% of all funding by ICAmembers. Commitments to the ICTsector were $620m, almost double theamount of commitments for 2016.

The $4.8bn of financing for water andsanitation projects remainedconsistent with the $4.6bn reportedthe previous year. However, the $5.7bnin financing of energy infrastructurerepresented a 25% fall from the$7.7bn committed in 2016. Thiscontinues the gradual decline seensince the 2014 high of $9.2bn. ICA

member funding for multi-sectoractivities also declined by almost 40%from $836m in 2016 to $528m in 2017.

Commitments by region show abalanced picture. For example, in 2017North, West, East and Southern(excluding South Africa) Africareceived around 20-25% of ICAmember financing (see Figure 23). Thisis consistent with the correspondingamounts for 2016. However, SouthernAfrica’s (excluding South Africa) sharehas more than doubled, reaching ahigh of $3.8bn.

Commitments to infrastructureprojects in South Africa continue todecline. In this regard, commitmentsdeclined from $966m in 2016 to$495m in 2017. Commitments toinfrastructure in Central Africadeclined from $2.2bn in 2016 to$1.9bn in 2017, thus indicating adeclining trend in the past few years.

In 2017, $10.9bn was disbursed byICA members. This amount is belowthose reported in 2011-16 of between$11.4-13.4bn. Consistent withcommitments reported in previousyears, the majority of disbursementsin 2017 were directed towards theenergy sector (44%). The regionalbreakdown of members’ dis-bursements in 2017 was alsoconsistent with those for 2016.However, Southern Africa saw adecline in disbursements from $1.5bnin 2016 to $815m in 2017.

4. ICA Member Financing



RSA$0.50bn

(2.5%)


CentralAfrica

$1.86bn(9.4%)


$3.77bn (19.2%)

Other*$0.90bn(4.6%)

Transport$8.12bn(41.3%)

Water$4.61bn (23.4%)

Energy$5.77bn(29.4%)

Multi-sector$0.53m(2.7%)

ICT$0.62bn

(3.1%)

*Including Pan-African, regional and unallocated

Total:$19.7bn

Total:$19.7bn

4.1 Overview

The significant gap in commitmentscompared to lower levels ofdisbursements is not unusual. This isoften a reflection of de-commitmentswhereby projects or financing do notgo ahead, and which have nothistorically been reported or recordedin the Infrastructure Financing

Figures 22 and 23ICA members’ 2017 commitments bysector (top), ICA members’ 2017commitments by region (bottom)


Trends in Africa series. Other reasonsfor disbursements being lower thancommitments include projects beingcompleted at a lower cost thanoriginally expected and slow projectpreparation processes that lead tounexpected delays in disbursements. Insome cases, commitments to funds werenot subsequently reported asdisbursements by ICA members butinstead appear as private sectorspending.

In terms of funding types, again, therehas been a rise in the amount of loansissued to infrastructure projects. On theother hand, grants have declined, albeitonly slightly. Commitments employingblended funding remain consistent ataround $2bn. Meanwhile, equityinvestments fell by nearly half to$159m.

In 2017, the share of ODA and non-

ODA financing changed significantly.In previous years the share wasroughly even. However, in 2017 ODAfinancing accounted for 62% of allcommitments and non-ODA financingaccount for just 25%. ICA members areunable to provide data on theremaining 13%. Around two-thirds ofdisbursements in 2017 were ODA, withthe remaining third being for non-ODA.

Soft infrastructure commitmentsdeclined to $1.5bn in 2017. Althoughthis is higher than the $1.3bn reportedin 2015, it remains below the $2.3bnand $1.8bn reported in 2014 and 2013,respectively. ICA member comm-itments made to project preparation fellfrom $245m in 2016 to $120m in 2017.

After recovering to $1.4bn in 2016, softinfrastructure disbursements declinedto $717m.

Support for regional operationsincreased from $1.9bn in 2016 to$3.1bn, representing 16% of all 2017commitments. This continues the trendof regional commitments varyingwidely from between $1.8bn to $4.5bnover the past six years.n

ICA Members’ 2017 Commitments Matrix ($m)

Transport Water Energy ICT Multi-sector TotalCommitments

North Africa 732.4 1,048.2 1,584.0 104.8 184.7 3,654.1

West Africa 2,227.8 803.5 1,648.9 182.6 23.7 4,886.4

Central Africa 574.9 359.9 852.8 58.1 9.5 1,855.2

East Africa 1,779.6 1,491.2 719.6 75.5 25.9 4,091.8

Southern Africa 2,389.5 716.0 525.1 107.1 30.9 3,768.5

RSA 288.4 5.9 71.2 0.2 129.4 495.1

Other 132.1 182.4 371.7 89.2 124.1 899.4

Total Commitments 8,124.7 4,607.0 5,773.2 617.6 528.1 19,650.6

ICA Members’ 2017 Disbursements Matrix ($m) - not including CDC

Transport Water Energy ICT Multi-sector TotalDisbursements

North Africa 803.1 477.5 1,493.2 34.2 116.3 2,924.3

West Africa 659.9 593.3 772.5 137.6 14.6 2,177.9

Central Africa 345.7 226.1 318.8 45.4 79.1 1,015.1

East Africa 874.6 526.2 635.5 69.0 42.8 2,148.1

Southern Africa 265.4 260.0 203.0 36.6 49.8 814.7

RSA 3.7 3.7 1,267.5 7.1 288.0 1,570.0

Other 86.6 43.8 76.8 54.3 35.4 297.0

Total Disbursements 3,039.1 2,130.6 4,767.2 384.1 626.1 10,947.1

Multilaterals and BilateralsIn 2017, multilaterals committed$12.8bn to Africa’s infrastructuresectors, accounting for 65% of allmembers’ funding. Commitmentsmade by bilaterals of $6.3bnaccounted for the remaining 35%.

Multilaterals’ share of total ICAmember financing was 58% in 2016and 69% in 2015.

It is however important to note thatbilaterals make financial contributionsto multilateral development banks,including ICA members such as theAfDB, EIB and WBG. n


As with previous years, almostthree-quarters (74%) of commit-ments made by ICA memberscomprised loan funding whilegrants accounted for 11%. Blendedfunds remain a popular mechanism,with $2bn (10%) in commitmentscombining a mixture of loans, grantsand/or equity (see Figure 24). Theremaining 5% of funding isrepresented by guarantees, insurance,equity investments or other financinginstruments.

A number of significant loans weremade across all infrastructure sectorsin 2017. JICA has provided a $401mODA loan for the Toamasina PortDevelopment Project in Madagascar.The objective of this project is toexpand Madagascar’s largest port.The AfDB and France’s AgenceFrançaise de Développement (AFD)have issued loans of $240m and$167m, respectively for the first phaseof the Midelt 800MW solar complexproject in Morocco. In addition, theAFD lent $167m for the second phase

of the Lake Victoria Water andSanitation Project (WATSAN II) inUganda.

Of the total project level data providedby ICA members, loans to the transportsector totalled $3.39bn in 2017. Notabletransport projects benefiting from ICAmember loans include the Dakar-Diamniadio Segment of the Dakar-Diamniadio-AIBD Regional ExpressTrain Project in Senegal (AfDB –$204m), Côte d’Ivoire’s Route du Nordroad (AFD – $134m), and the secondline of the Casablanca tramway inMorocco (EIB – $67m).

Projects benefitting from the $1.6bn ofloans to the energy sector reported bymembers included the 420MWNachtigal hydroelectric independentpower plant in Cameroon (AfDB –$167m) which aims to increase theavailability of reliable, renewableenergy power throughout the country;Zambia’s Scaling Solar powerprocurement programme (EIB –$11.8m) which will help achieve low

cost electricity; and the second phaseof the Tobene independent powerproject in Senegal (InternationalFinance Corporation (IFC) – $8.2m)which will expand the 96MW HFO-fired plant by 19MW. The expansion ofTobene, which is estimated to cost$36.7m, is already under constructionas of August 2018.

ICA members provided project leveldata on $1.69bn of ICT loans issuedduring 2017.

The Sfax Sea Water DesalinationPlant Construction Project in Tunisiahas benefitted from a $325m ODAloan from JICA. The plant will provide100,000 cubic metres per day of highquality drinking water to the 600,000people living in the Sfax metropolitanarea in central Tunisia whichexperienced a water shortage in early2017.

Grants totalling $1.3bn were reportedby members, including a $122m grantfrom the EU’s Africa InfrastructurePlatform (AIP – formerly Africa Infra-

4.2 Types of Funding

Loans Grants Blendedfunds: grant

element

Blendedfunds: loan

element

Equityinvestment

Guarantees/insurance

OtherBlendedfunds:other

$14.27bn

$2.20bn

$0.65bn $0.11bn$1.18bn

Grants 11.2%Blended funds: grant element 3.3%

Other 3.4%Guarantees/insurance 0.3%Equity investment 0.8%

Blended funds: loan element 0.6%

Loans 72.6%

Including forexampletechnical

assistance$0.16bn $0.06bn $0.67bn

Blended funds: other 6.0%

Unknown 1.7%

Total:$19.7bn

Figure 24 ICA members’ 2017commitments bytype of funding


structure Fund), via the EIB, for themodernisation of the road network inMadagascar; and $51.5m from JICAfor the South Bypass ImprovementProject which will be used to repairthe south-east section of the 7kmbypass road from Boulevard desTansoba in Burkina Faso’s capital,Ouagadougou. The bypass road isexpected to increase daily freightvolume from 4,500 to 6,900 tonnes.

For the 35 projects that attractedblended funds in 2017, the AfDBcontributed $973m. WBG committed$581m in blended funds while the

commitments from France, Germany’sKfW , and DBSA were $272m, $113m,and $5.5m, respectively.

Of total commitments made inblended funds, $783m was directedtowards regional projects. AfDBcommitted grants for several com-ponents of PIDA/PAP projects,including $298m for the Cameroon-Chad Power Interconnection Project,and $155m for the Nigeria-Niger-Burkina Faso-Benin Power Inter-connection Project.

A number of equity investmentswere made by ICA members into

infrastructure focused companiesduring 2017. IFC reported $50m ofequity investments in Actis Fund 4, afund managed by UK private equityfirm Actis Capital which will supportICT and multi-sector projects. Thefinancing is part of a larger $100minjection into Actis Fund 4, $65m ofwhich is from IFC’s own account andthe remaining $35m from IFC AssetManagement Company. EIB alsoapproved an equity investment of upto $50m into the power-focused fundof US private equity firm DenhamCapital, the largest proportion ofwhich will be targeted at Africa.n

Great North Road – Zambia EIB – $122m (loan), AIF – $76.5m (grant)

The EIB provided a $122m concessional loan and AIF a $76.5mgrant (via EIB) to Zambia’s Ministry of Finance to upgrade theGreat North Road (T2). The objective of the project is to widenand upgrade 372km of road between Mpika and Nakonde. Theupgraded road is expected to enhance safety, shorten traveltime, and reduce bottlenecks. In addition, given that it is a keynational road which connects Zambia to neighbouringTanzania and Zimbabwe, the upgraded road is expected tofacilitate intra-African trade. The T2 loan also covers therehabilitation of about 50km of feeder roads, support for anumber of unspecified complementary initiatives in the area,and the provision of technical assistance.

Addis Ababa Power Supply ImprovementProject – EthiopiaAfDB – $99.6m

In November 2017, the AfDB approved $99.6m in blendedfinance for the Addis Ababa Power Supply Improvement Projectin Ethiopia. A $83.6m African Development Fund (ADF) loanwas supplemented by a $14.2m ADF grant to help finance therehabilitation and construction of 545km of medium-voltagelines, replace and install 582 distribution transformer and 13primary substations, upgrade nine high-voltage substationsand construct 3.8km of 132kV double-circuit overhead lines.The project, which is expected to be completed by end-2020,is designed to alleviate existing or future constraints involvingelectricity infrastructure and address the connection backlogof an estimated 432,000 customers.

Bamako Drinking Water and SanitationSystem – MaliEIB – $56m

In June 2017 the EIB signed a €50m ($56m) loan for a drinkingwater and sanitation system in the Malian capital Bamako. Theloan, which supports the Millennium Development Goals-aligned Water and Sanitation Programme of the government,addresses the ever-increasing water access needs of a rapidlyincreasing population. The project will double water capacityfrom 144,000 to 288,000 cubic metres per day by 2021.Overall, 2.5m people will benefit from the new sanitationsystem. Of these, 560,000 people will have access to drinkingwater in the very near future.

‘Digital Tunisia 2020’ National StrategicPlan – TunisiaAfDB – $81.7m

In October 2017, AfDB approved an $81.7m loan to finance theTunisian government’s €135m ($150m) ‘Digital Tunisia 2020’National Strategic Plan. The project will be implementedbetween 2018 and 2020. In general, it will strengthen publicservices through the use of digital platforms on a grand scale.The activities include the implementation of onlineadministrative and sectoral information services and thedevelopment of a digital ID system and a data exchangeplatform. The programme covers a wide geographical area andwill reduce the current regional disparities significantly. Onceimplemented, Digital Tunisia 2020 will help create a climate ofopen government and provide impetus to the digital economy,providing much-needed job opportunities for younggraduates.

Projects Financed in 2017ICA members provide finance to projects and programmes in four sectors: transport, water, energy and ICT. The followingprojects are selected to provide examples of members’ activities in each of those sectors.


ICA members reported softinfrastructure commitments of$1.5bn in 2017. In 2016, thecommitments amounted to $1.7bn.

While this amount is more than the$1.3bn reported in 2015, it is lowerthan the amount of $2.3bn for 2014.Soft infrastructure as a proportion oftotal commitments in 2017 stood at7.8%, which is consistent with theproportion for the previous year.

Project preparation commitments of$120m accounted for about 0.6% oftotal commitments. While this islower than the $245m reported in2016, it is broadly consistent with thehistorical trend. Project preparationdisbursements stood at $88m in 2017,which represents just under 1% of thetotal. Again this was around half ofthe figure reported in 2016.

In 2017, soft infrastructure disburse-ments amounted to $717m, or 72% oftotal disbursements. This is about halfthe $1.4bn reported in 2016 andsignificantly below the $3.1bndisbursed in 2014. It should be notedthat soft infrastructure financingfigures prior to 2015 included projectpreparation data. Project preparationdisbursements, however, are relativelysmall, so this change in data reportinghas not altered the overall trend insoft infrastructure disbursementssignificantly.

ICA members provided project leveldata on 69 soft infrastructuredisbursements across regions andsectors, the largest of which was the$167m disbursement by AFD of aloan for the Egyptian power sector.

An additional 69 projects totalling$838m of soft commitments werereported by ICA members in 2017.Notable commitments in 2017 include$187.5m by AFD for Nigeria’s LagosStrategic Transport Master Plan, and$35m by AfDB for the Kapchorwa-Suam-Kitale and Eldoret BypassRoads Project in East Africa.n

4.3 Hard vs Soft Infrastructure

WBG AfDB Japan France EU Germany UK DBSA US (MCC) Italy Canada


8,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

$m

5,000

4,000

3,000

2,000

1,000

0

$m

99.9%

0.1%

3,216

2,360

1,432

1,881

820

203

477292

4,059

2,463

241

841583

218

911

5800

6,935

15134

0.70

6910

1235

0.418

698

343020

8504

0019

0270

11

400

500

0062

0

917 206

00 69

8

00.8

140

93.8%

6.2%

95.1%

4.5% 0.4%

100%79.2%

20.8%

96.9%

2.4% 0.7%

80.7%

19.3%

74.1%

23.3%

2.6%

99.9%

0.1%

100% 100%

92.3%100%

7.7%

95.6%

4.0% 0.5%

67.4%

32.6%

97.6%

0.6%1.8%

97.8%

0.1% 2.1%

32.5%

11.1%1.2%

55.1% 96.0%

4.0%

95.0%

5.0%

100%

116

Unknown

Project preparation commitments

Soft infrastructure commitments

Hard infrastructure commitments

Unknown

Project preparation commitments

Soft infrastructure commitments

Hard infrastructure commitments

Total:4,330

2,590

4

1,158868

723

294

912

0

5 62

Total:7,516

3,364

2,361 2,123

1,928

838 623

497292 89 19

Figure 25 ICA members’ 2017 hard/soft/project preparation infrastructure commitments

Figure 26 ICA members’ 2017 hard/soft/project preparation infrastructure disbursements


As per previous reports, trends incommitments and disbursementsare based largely on aggregateddata, reflecting the challengesfaced by some ICA members interms of both collating anddisclosing disaggregated finan-cial information.

CommitmentsAccording to data provided by ICAmembers, commitments towardsinfrastructure projects in 2017 haveremained consistent with the previousyear. The most notable changes are asignificant increase in commitmentsto the transport sector, which reached

an eight year-high of $8.1bn (seeFigure 27). The financing ofinfrastructure projects in SouthernAfrica also reached a high of $3.8bn(see Figure 28).

After a slight dip in 2016, totalcommitments by ICA membersrebounded to $19.7bn in 2017. This is$190m below 2015’s record high(when the exceptional $7bn PowerAfrica contribution in 2013 isexcluded). During the 2012-17 period,commitments from ICA membersranged between $18.7bn-$19.8bn,which contrasts with the $29.bn and$11.9bn reported in 2010 and 2011,respectively.

The $620m of commitments to theICT sector in 2017 slightly exceededthe 2015 high of $616m, while the$4.6bn of financing towards watersector projects fell by only 1%compared to 2016. Commitments tomulti-sector projects remain at a levellower than the previous four years.Financing of power sector projectsalso decreased by 25% to $5.8bn.However commitments to all othersectors are above the eight-yearaverage.

Data provided by ICA members forthe period 2010 to 2017 shows thatthe average level of commitments overthe eight year period are: transport

4.4 Trends in Commitments & Disbursements

2010 2011 2012 2013 2014 2015 2016 2017

2010 2011 2012 2013 2014 2015 2016 2017

30

20

10

0

$bn

30

20

10

0

$bn

2.4

1.1

3.3

2.45.1 4.1

8.9

1.6

4.7

2.3

6.7

2.4

0.81.4

2.7

1.7

2.2

2.14.9

1.2

0.72.0

1.6

5.0

8.5

2.4

6.9

2.5

1.11.4

3.4

3.7

2.0

2.0

1.51.1

4.0

1.3

4.7

1.8

1.7

2.2

3.8

1.0

4.6

5.3 3.66.86.9

12.9

0.30.8

4.4

0.50.23.0

3.8

3.4

5.6

7.8

0.10.50.2

5.0

13.0

0.41.5

3.4

9.2

0.52.2

3.2

8.6

0.60.6

3.7

4.9

1.9

4.1

3.8

0.50.9

8.1

4.6

5.8

0.60.5

5.0

4.7

7.7

0.40.9

3.7

4.6

2.2

4.4

1.41.01.4

West Africa (10.7%)

North Africa (Ð11.9%)

Central Africa (2.1%)

East Africa (Ð2.0%)

Southern Africaexcluding RSA (7.3%)

RSA (Ð31.1%)Other (Ð13.1%)

Compound annual growth rate (CAGR),

2010Ð2017

Water (2.8%)

Transport (2.4%)

Energy (Ð10.9%)

ICT (10.9%)Multi-sector (Ð5.8%)

Unallocated

Compound annual growth rate (CAGR),

2010Ð2017

TOTAL (Ð5.4%)

29.1

11.9

18.7

25.3

18.8 19.8 19.7

TOTAL (Ð5.5%)

29.1

11.9

18.7

25.3

18.8 19.8 19.718.6

18.6

Figure 28 ICA members’commitments byregion (includinggrowth rate),2010-2017

Figure 27 ICA members’commitments bysector (includinggrowth rate),2010-2017


Trends in Commitments & Disbursements

$5.6bn, water $4.1bn, energy $8.5bn,ICT $410m, multi-sector $940m.

Commitments to infrastructureprojects in North, West, Central andEast Africa in 2017 remainedconsistent with the previous year.Financing of projects in West Africarose by $300m, while commitments inCentral and East Africa both fell by$300m. Since 2014, only minor changesare noticeable in the regionalallocations of ICA member commit-ments to infrastructure (see Figure 29).The financing of projects in West andSouthern Africa were above the eight-year average of $4.2bn and $2.1bn,respectively. However, commitments toNorth, Central, East and South Africawere slightly below average.

DisbursementsTotal disbursements made by ICAmembers stood at $10.9bn in 2017.This represents an 18% declinecompared to the 2016 high of $13.4bnand is below the eight-year average of$12.2bn.

The change is accounted for mainlyby a $292m (25%) decline by DBSA, a$242m (17%) drop from France, and a$645m (47%) reduction fromGermany. Disbursements fromGermany were particularly high in2016, therefore such a reduction isnot unusual. Disbursements reportedby the EU were also down $363m(30%) in 2017, however this figureonly includes EIB (which reporteddisbursements totalling $839m) andthe EU-Africa Infrastructure TrustFund (EU-AITF) which reported$28m. The EC, which reporteddisbursements totalling more than$1bn last year, was unable to providedata for 2017.

Disbursements to all sectorsexcluding ICT declined in 2017compared with 2016. For exampledisbursements to transport declinedby $700m, water by $400m, energy by$1.3bn, and multi-sector projects by$200m. Disbursements to ICTprojects rose from $300m in 2016 to



8,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

$m

5,000

4,000

3,000

2,000

1,000

0

$m

98

685

325462

1,009

198

416

406596

602

32

00

31

2214

75

5546

491412

11330.20.050.12

140027200

029200000

00065313982

2201000

1251920.00724

0381810890121

04000.400

872

1,860

722

2,150

1,23773

1,047

758

663178

28971

183

1,493

923173

525010

207

7070

051756

162

241168

32

889426193410182

2

199

974

555

1,094

1,016525

220

657

232

257181128

06337

100 355015

103

8036301447

053070327479

Other (including Pan-African, regional and unallocated)

RSA

Southern Africa excluding RSA

East Africa

Central Africa

West Africa

North Africa

Other (including Pan-African, regional and unallocated)

RSA


East Africa

Central Africa

West Africa

North Africa

Total:4,330

2,590

4

1,158868

723 294 912

0

5 62

Total:7,516

3,364

2,3612,123 1,928

838 623 497 292 89 19

Figure 29ICA members’ 2017 commitments by donor and region

Figure 30ICA members’ 2017 disbursements by donor and region


$400m in 2017, which is consistentwith the levels seen between 2013 and2015.

As in the past, multilaterals led theway in terms of disbursements in2017, with 71% ($7.8bn) of totaldisbursements coming from WBG,AfDB and EU. Bilaterals accountedfor the remaining $2.2bn. Multilateraldisbursements of $7.8bn for 2017 arebelow the $10.6bn reported in 2016.However, it should be noted that thedata for 2017 does not includeinformation from the EC.

The WBG’s 2017 disbursements of$4.3bn were the largest reported by anyICA member. This is comparable withits $4.1bn of disbursements recorded in2016. It is noteworthy that since 2013,the WBG has been disbursing thehighest amount among ICA membersevery year.

Of the WBG’s $4.3bn disbursementsin 2017, $1.9bn was directed to theenergy sector. The transport and



8,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

$m

5,000

4,000

3,000

2,000

1,000

0

$m

6

732

1,048

1,584

10518358761070.289

1852492631129124

4

803

477

1,493

34138456937754

1161579435028835

2,228

575

1,780

2,389

288132

804

360

1,491

716182

71

1,649

853

720

525

372

660

346

875

26587

444

593

226

526

260773

319

635

203

1,26777

Other (including Pan-African,

RSA regional and unallocated)


East Africa

Central Africa

West Africa

North Africa

Other (including Pan-African,

RSA regional and unallocated)


East Africa

Central Africa

West Africa

North Africa

Total:8,125

4,607

5,773

618 528

Total:3,039

2,131

4,767

384626

20172016201520142013

0

2

4

6

8

10

12

14

$bn

3.03.5

4.24.2

2.1

2.6

2.62.4

4.8

5.04.03.9

0.4

0.40.4

0.4 0.6

1.11.8

0.4

3.7

2.5

6.1

0.30.8

Multi-sector

ICT

Energy

Water

Transport 13.413.0

Total:11.3

12.6

10.9

Figure 31ICA members’ 2017 commitments by sector and region

Figure 32ICA members’ 2017 disbursements by sector and region

Figure 33ICA members' disbursements by sector,2013-2017


water sectors received $1bn each. Theremaining disbursements weredirected at ICT ($281m) and multi-sector ($65m) projects.

North and East Africa both receiveddisbursements of about $1bn fromWBG. This includes $648m for energyprojects in Egypt, and $184m fortransport projects in Kenya.

Other countries that receivedsubstantial disbursements from WBGinclude Nigeria ($299m), Ethiopia($204m), DRC ($144m), Morocco($185m), Tanzania ($246m), andSouth Africa ($189m).

Disbursements made by AfDB rose

from $2.4bn in 2016 to $2.6bn in 2017.The AfDB’s disbursements have beenrising since 2014. EU disbursementsfell from $1.3bn in 2016 to $868m in2017. Although again this 2017 figuredoes not include EC data, which in2016 amounted to $1bn. Of EUdisbursements in 2017, the EIB’s$839m was down on the $1.2bnreported in 2016, while EU-AITFdisbursements of $28m were alsodown on the $38m reported theprevious year.

The largest disbursements made bybilaterals came from France, withAFD reporting that the country’sdevelopment institutions and fundsdisbursed $1.2bn in 2017, slightly

more than the $912m disbursed byDBSA.

Disbursements made by bilateralsdropped in 2017. Despite being thelargest source of disbursements,France’s AFD reported that totaldisbursements of $1.2bn made by thecountry’s development institutionsand funds declined by 17% comparedto 2016. DBSA, which at $912m wasthe second largest source ofdisbursements in 2017, also reporteda decline of 24% on the previous year.

Italy’s disbursements ($5.4m) declinedby fell 72%, and Japanese disburse-ments ($4.3m) declined by 93%. n

Trends in Commitments & Disbursements

The NEPAD Infrastructure Project Preparation Facility

(NEPAD-IPPF), the multi-donor fund hosted by the AfDB,

which supports African countries’ preparation of regional

infrastructure projects, provided commitments of $4.8m and

disbursements of $5m in 2017. This compares with

commitments provided of $14.8m and disbursements of

$7.8m in 2016.

The facility provided entirely ODA grant funding. It provided

$2.1m (43%) of commitments to the transport sector; $1.6m

(32%) to water and sanitation operations and $1.2m to ICT

projects. A total of $2.3m (47%) of commitments targeted

East Africa while $2.1m (43%) targeted Southern Africa

excluding South Africa, which alone received $500,000 or

10% of total commitments. In 2016, energy projects received

commitments of $8.6m while the transport and water sectors

received $5m and $1.3m, respectively.

Disbursements of $4.4m were provided for transport

projects while energy projects received $261,139, water

operations $201,139 and ICT activities $57,310. In 2016,

disbursements of $4.2m were provided for transport projects

while energy projects received $3.1m and water projects

$473,692.

NEPAD Infrastructure Project Preparation Facility

NEPAD IPPF Commitments, 2017

Project Region Commitment ($m)

Masaka-Mutukula-Kyaka-Bugene-Kasulo-Kumunazi Roads Project East Africa 2,089

Support Project for the Creation of a Communauté Economique des Etatsde l’Afrique Centrale (CEEAC) Cross-border Basin Organisation Central Africa 1,073

Feasibility Study For Gabon ICT Backbone Project Central Africa 1,179

Public Private Partnership Advisory Services for the Songwe River BasinDevelopment Programme (SRBDP)

Southern Africa(excluding RSA) 500

Totals 4,841


4.5 Projects Completed

Ten ICA members providedfinancial information on 183projects completed in 2017,totalling $5.2bn in commitmentsand $4.7bn in disbursements1 (seeFigures 34-36). These projects relate toboth investments and technicalassistance. The average originalcommitment year for these projects was2012. Unlike previous years, none weremade before 2000. A single project hadits original financial commitment madein 2001 while 122 projects hadcommitments made this decade.

Transport projects amounting to$1.6bn were completed in 2017, whichis equal to that recorded in theprevious year. The 37 energy sectorprojects completed in 2017 totalled$2.6bn, accounting for 50% of thevalue of all completed projects andrepresenting a significant increase on

the $1.2bn reported in 2016. The valueof completed water sector projects fellfrom $1.2bn in 2016 to $834m in 2017,while ICT projects of $103m were alsoreported as being completed in 2017.

As in the past, the breakdown byfunding type is different from previousyears. Loans accounted for 59% of thetotal funding for completed projects in2017. While this is significantly morethan the 25% reported in 2016, it isbelow the 75% recorded in 2015.

As in the past, grant funding was themost popular method of financing forprojects completed in 2017, which at$1.7bn was less than loan funding, butmore than the $1.5bn reported for2016. Only $127m was reported ashaving been committed via blendedfinance instruments in 2017, which issignificantly below the $1.1bn in 2016.

The regional breakdown of completedprojects is somewhat different toprevious years. Projects completed inNorth Africa totalled $1.5bn in 2017,which is almost double the $858mrecorded in 2016. Completed projectsin Central Africa also more thandoubled, from $251m in 2016 to$559m in 2017, while the total forSouthern Africa (excluding SouthAfrica) rose from $508m to $1.4bn.

In West Africa, the value of completedprojects declined to $461m, while inEast Africa it remained at just over$1bn. South Africa reported only$115m of completed projects in 2017,which is significantly down from the$1.1bn reported in 2016. n

No. ofprojects

AfDB 36

France 40

EIB 22

Japan 17

IFC 8

KfW 12

GIZ 11

Canada 30

EU-AITF 6

DBSA 1

0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600$m

2,0911,821

1,3331,333

682682

621583

161169

98

4444

1919

22

94

154n.a.

Commitments

Disbursements

Transport

Water

Energy

ICT

Multi-sector

0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600$m

834

2,632

103

18

1,617

North Africa

West Africa

Central Africa

East Africa

Southern Africaexcluding RSARSA

Other*

0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600$m

461

1,529

559

115

1,412

1,056

9

71* Including Pan-African, regional and unallocated

Figure 36 ICA membersupported projectscompleted in 2017,by region

Figure 34ICA members’commitments anddisbursements forcompleted projects

Figure 35ICA membersupported projectscompleted in 2017,by sector

ICA membersupportedprojectscompleted in2017:

1 Project level data was not received from DFIDor WBG


4.6 Disbursement Rates


500

0

$m

2,500

1,500

1,000

2,000

408

1,170

210(51%)

1,106(95%)

126

599

118(94%)578

(96%)

1,143

942

1,138(100%)

76

645(68%)

76(100%) 18

1,249 1,239(99%)

17(98%)

00

Total project-based disbursements

Non-ODA disbursements

ODA disbursements

Original project-based commitments

Non-ODA commitments

ODA commitments

(Averagedisbursementrate)

Average year of commitmentTransport: 2012 (ODA: 2012, non-ODA: 2011)

Water: 2011 (ODA: 2011, non-ODA: 2009)

Energy: 2012 (ODA: 2012, non-ODA: 2012)

ICT: 2014 (ODA: 2014, non-ODA: 2012)

Multi-sector: 2012 (ODA: 2012, non-ODA: Ð)

Total:1,578

1,316(84%)

725696

(96%)

2,3922,377(99%)

1,018

721(71%)

18

17(98%)

Figure 37Disbursement ratesper sector forselected ICAmember projectscompleted in 2017

The disbursement rate is thepercentage of disbursementsmade to projects completed in2017 compared with the originalamount committed. The disburse-ment rate is therefore not anattempt to compare ICA members’commitments and disbursementsmade in 2017.

As with previous years, some of theprojects reported as completed by ICAmembers in 2017 had their originalcommitments made several years ago.However, the average timeframebetween commitment and completionappears to be shrinking, indicating thatprojects are being completed at a fasterrate.

Total disbursements of $4.7bnrepresent about 94% of the $5bnoriginally committed (some of whichdates back to 2001) for projectscompleted in 2017. This figure iscomparable with the 95% reported in2016, and only 3% lower than the 97%reported in 2015. This trend follows aperiod of relatively low disbursement

rates of 84% and 77% in 2014 and2013, respectively.

The disbursement rate to transportsector projects fell to 84% in 2017from the 95% reported in 2016.Possible reasons include projectsbeing completed at lower costs thaninitially anticipated due to advancesin technology and manufacturing. Thecancellation in 2017 of two loanstotalling $90m and $50m issued,respectively, in 2015 by the AfDB andits Africa Growing Together Fundwindows for the Sharm El-SheikhAirport Project in Egypt, has alreadycontributed to the relatively lowdisbursement rate in this sector.

The disbursement rate to waterprojects remained consistent with2016’s figure of 96%, while thedisbursement rate for energy projectsincreased from 93% in 2016 to 99% in2017. The disbursement rate to ICTsector projects was 100%, equallingthat reported in 2016.

After last year’s high disbursementrates among non-ODA projects, data

provided by ICA members show thatthis has fallen back to levels reportedin previous years. The non-ODAdisbursement rate for transportprojects has fallen significantly from98% in 2016 to 51% in 2017, while therate of non-ODA disbursements forwater projects fell from 100% in 2016to 94% in 2017. The energy sectorhowever saw the rate of non-ODAdisbursements rise from 85% to 100%.

Of the 183 projects completed in 2017,the average date of their financialcommitments was 2012. This averageof five years is significantly shorterthan the nine years reported in 2016.

Transport sector projects, which in2016 had an average of nine yearsbetween a project commitment and itscompletion, fell to five years. Theaverage time to complete water andsanitation projects fell from seven yearsto six, while energy projects droppedfrom seven years to five, and ICTprojects from 11 years to three years. n


4.7 Trends in Regional Infrastructure Portfolios

2010 2011 2012 2013 2014 2015 20172016

0

$m

4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

4,500

327

751 7891,090

288

1,299 1,046193

1,230

688

310

1619

n.a. n.a. n.a.

682

1,568 803

449

977

622

223

604

587

258

174

67241

1,124

553

591

297

1,030

n.a.

227

967

195

79 10

194

156

88

0

8 96

0n.a.n.a.n.a.

61 n.a. n.a. n.a.

92 n.a.230

23 n.a.

51

152 n.a.129

292

2517426

479

133

369

2

264

349

32101

12410

DBSA

Canada

UK Ð CDC

UK Ð DfID

EU

WBG(including

IFC)

AfDB

Japan

France

Germany

Total:2,783

2,091

4,529

4,203

1,810

3,408

3,078

1,864

Since 2010, ICA members’commitments to regional projectshave fluctuated significantly. The$3bn-worth of commitments reportedin 2017 is considerably higher thanthe $1.9bn recorded in 2016, but isbelow the $3.4bn seen in 2015 andway off the record high of $4.5bnreported in 2012. As a result, it isdifficult to ascertain any trends inregional investments.

Of total regional commitments in2016, over half ($1.6bn) were directedat transport projects while under$1bn was committed to energy sectorprojects. Major investors in regionalinfrastructure projects in 2017included AfDB, which at $1bn morethan doubled its total commitments toregional projects in 2016. The WBG

increased investments from $133m in2016 to $622m, while the UKincreased its regional spending from$133m in 2016 to $199m in 2017.

Japan, which made commitmentstotalling just $2m in 2016 reportedregional investments of $1bn in 2017.This was accounted for by a single$1bn non-ODA loan to finance theconstruction of the Nacala railwayand port infrastructure inMozambique and Malawi. This$2.73bn project is a part of the Beira-Nacala Multimodal CorridorsPIDA/PAP project and is financed byJapan’s Mizuho Bank, AfDB and nineprivate finance institutions. Therailway will connect the Moatize coalmine in Mozambique’s westernprovince of Tetê – under development

by Brazilian miner Vale and Japan’sMitsui & Co – to the 22m tonnes peryear capacity deep-sea port of Nacalaon the country’s east coast. Thismassive investment by Japan, whichis dependent on imported coking coal,will help to reduce its fuel supplyrisks. For Southern Africa, the railwayline, which will cross Mozambique andMalawi and possibly be extended toZambia, will help facilitate intra-African trade through improvedregional transport links.

The data provided on project levelcommitments for 2017 was limited.Notable commitments include the$12m provided by AfDB to theEconomic Community of West AfricanStates (ECOWAS) for the promotionof a climate-friendly market.n

Figure 38 Trends in regional infrastructure portfolios, 2010-2017


4.8 PIDA/PAP Commitments, Disbursement Trends

Commitments from ICA membersto Programme for InfrastructureDevelopment in Africa PriorityAction Plan projects amounted to$2.9bn, one-third higher than the$2.1bn committed to PIDA fromall sources in 2016. Total ICAcommitments in 2016 amounted to$447m, while non-ICA memberscontributed $1.6bn, which was mainlyChinese funding for two port projectsin Kribi, Cameroon and Tema, Ghana.

Transport sector projects for thesecond year running received mostPIDA funding from ICA members,with the Beira-Nacala MultimodalCorridors receiving a commitment of$1.5bn from Japan. The commitmentis one of several efforts made bystakeholders to promote this project.The SADC Secretariat and NEPADfor example have worked withDeutsche Gesellschaft für Inter-nationale Zusammenarbeit (GIZ) onthis project in the context of the PIDAAcceleration Pilot Programme whileJapan in 2015 put $241m towards theNacala Port Development ProjectPhase 2 which is part of thisambitious development.

The entire project comprises therehabilitation and reconstruction ofrailway and road links. This will alsoinvolve the upgrading of one-stopborder posts along the corridors;

improvement of capacity at the ports,capital dredging at Beira Port andnatural resource development,including the Moatize Coal Field inthe Zambezi Valley that will use theports as main export gateways.

ICA members are collaborating onseveral initiatives in PIDA/PAP, whichextends to 2020. The collaborationcovers 51 programmes and projectsdivided into 433 projects in thetransport, energy, ICT and trans-boundary water sectors.

AFD, AfDB, EU and GIZ support theCommission Internationale du BassinCongo-Oubangui-Sangha (Congo-Oubangui-Sangha International Com-mission) which is mandated with thepromotion of inland navigation andwater resources development in theCongo basin. The basin extends acrossten countries, in an area seven timeslarger than Germany. It is the secondlargest river basin worldwide justafter the Amazon basin.

One important PIDA project in theCongo is the Palambo multi-purposedam on the border of DemocraticRepublic of Congo and Central AfricanRepublic. The project aims to providesolutions to problems of interruptionof navigation on the Oubanguitributary of the Congo River. Theproject also addresses the issue ofregional electricity shortages with the

construction of the Oubangui flowcontrol and power generation dam atthe Palambo site, which is about 60kmupstream from Bangui.

In the energy sector, AfDB made newcommitments in 2017 to the CentralAfrican Interconnection and the WestAfrica Power Transmission Corridor.It also disbursed funds to severaltransmission projects, including theWest Africa Power TransmissionCorridor, North–South Power Trans-mission Corridor, Central AfricanInterconnection and North–SouthPower Transmission Corridor. Inaddition, disbursements were made totwo major regional power generationprojects, Inga III Hydro and RusumoFalls.

Inga III involves the construction ofan 11,050MW hydropower project onthe Congo River. The project is seen asthe leading clean, affordabledevelopment option to address thechallenges of energy access in Africa.Moreover, the project aims to createlocal employment and incomegeneration opportunities and stabiliseregional political conditions. Angola,Democratic Republic of Congo andSouth Africa are expected to benefitfrom the project. It is expected togenerate up to 2,500MW of power.

Pre-feasibility studies for the projectwere completed in 2017. Commission-

Specified ICA Member Commitments to PIDA Projects ($m)

PIDA/PAP No. & Project AfDB EU-AITF Germany Japan Total

2. North-South Power Transmission Corridor 12 12

6. Central African Interconnection 298 298

8. West Africa Power Transmission Corridor 238 11 249

12. Ruzizi III 27 16 43

Energy Total 536 27 27 12 602

16. TAH programme 24 24

20. Northern Multimodal Corridor 156 111 267

24. Beira-Nacala Multimodal Corridors 1,501 1,501

26. Southern Africa Hub Port and Rail Programme 401 401

31. West Africa Hub Port and Rail Programme 132 132

Transport Total 0 0 156 2,169 2,325

Total 536 27 183 2,181 2,927


Data provided by AfDB, EIB, EU-AITF, WBG, DBSA, Canada, France,GIZ, KfW, Italy, JICA and JapanBank for International Co-operation (JBIC), as well as thosesourced independently from CDCand the US’s Millennium ChallengeCorporation (MCC), show $16.3bnof commitments made to nationalprojects in 2017.

This figure excludes the $3.1bn ofregional commitments and the $254mprovided by the UK’s Department forInternational Development (DFID) for

which country allocations were notprovided.

The figures show similar countryallocations as in 2016. Egypt was thesingle largest recipient ofinfrastructure finance in Africa in2017, with total commitmentsstanding at $1.7bn. This accounted forthe lion’s share of total funding in theregion (47%), while Cameroonreceived 29% of commitments made toCentral Africa, slightly less than the34% of the regional commitments thatwere directed towards Rwanda.

Kenya, which with 55.8% was themajor recipient of ICA membercommitments to East Africa in 2016,was in 2017 replaced by Tanzania,which received 34% of the region’sallocations.

Country-level commitments expressedas dollar spend per capita and as apercentage of GDP show interestingdistributions, with Indian Oceanislands benefitting from ICA financingin greater terms relative to theircontinental neighbours. Seychellesreceived $195 per capita in

4.9 Country Allocations

ing of preliminary works is expectedby the end of 2018. Projectpreparation costs are estimated at$423m while capital costs of $18bnare anticipated.

In 2017, KfW committed to twoPIDA/PAP energy projects, both witha distinctly regional outlook. The WestAfrica Power Transmission Corridoris a 2,000km line along the coastconnecting with the existing Ghana–Nigeria line with a capacity of1,000MW. Guinea, Guinea-Bissau,Gambia, Sierra Leone, Liberia, Côted’Ivoire and Ghana are expected tobenefit from the project that will aidin the establishment of an integratedWest African power market and willensure lower energy costs andimproved energy security. Thereduction in the need for reservecapacity in the existing powersystems will lead to savings oninvestment costs.

Ruzizi III involves the construction ofa 30-metre high, 120-metre longrockfill dam with a reservoir capacityof 1.9m cubic metres and threeFrancis-type turbines. It is sponsoredby the Energie des Grands Lacsconsortium and will be developed on apublic-private partnership basis. Thepower will be bought by Distributiond’Eau et d’Electricité of Burundi(Regideso), Société Nationale

Japan

AfDB

Germany

EU-AITF

0 $m 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200

535

183

27

2,181

SA

DC

CO

UN

TR

IES

E C O W A SC O U N T R I E S

Transport projects

Energy projects

PIDA/PAP no. 2: North-SouthPower Transmission Corridor.Commitment: Japan $12m.PIDA/PAP no. 6: Central African

Power Interconnection.Commitment: AfDB $298m.

PIDA/PAP no. 8: West AfricaPower Transmission Corridor.Commitments: AfDB $238m,Germany $11m.

PIDA/PAP no. 12: Ruzizi III HEP.Commitments: EU-AITF $27m,Germany $16m.

PIDA/PAP no. 16: TAH (Trans-African Highways) Programme.Commitment: Japan $24m.

PIDA/PAP no. 24. Beira-Nacala Multimodal Corridors.Commitment: Japan $1,501m.PIDA/PAP no. 26. Southern Africa

Hub Port and Rail Programme.Commitment: Japan $401m.

PIDA/PAP no. 31. West AfricaHub Port and Rail Programme.Commitment: Japan $132m.

PIDA/PAP no. 20: NorthernMultimodal Corridor.Commitments: Germany$156m, Japan $111m.

Figure 39 Specified ICA member commitments to PIDA projects

d’Electricité of the DemocraticRepublic of Congo (Snel), and Energyand Water Sanitation Authority ofRwanda under long-term powerpurchase agreements. In 2017 theAga Khan Fund for EconomicDevelopment (AKFED)’s IndustrialPromotion Services and CDClaunched a new power platform to

mobilise funding for projects in sub-Saharan Africa including Ruzizi III.

Key commitments to Ruzizi III –which is supported by several ICAmembers – in 2017 included a €22m($25.4m) project preparation grantfrom EU-AITF, which committed$26.7m and disbursed $9.6m toPIDA/PAP projects in 2017. n


Country Allocations

ANGOLA

SOUTHAFRICA

MADAGASCAR

BOTSWANA

ZIMBABWE

ZAMBIA

LESOTHO

MALAWI

TANZANIA

KENYAUGANDA

RWANDABURUNDI

GABON

NAMIBIA

DJIBOUTI

ERITREASUDAN

CHAD

NIGER

EQUAT. GUINEA

SÌO TOM� & PRêNCIPE

CAMEROON

MALI

ALGERIALIBYA

EGYPT

TUNISIA

MOROCCO

MAURITANIA

MAURITIUS

SENEGALGAMBIA


SIERRA LEONE

LIBERIA

CïTEDÕIVOIRE

BENIN

MO

ZAM

BIQUE

BURKINAFASO

GHANA NIGERIA

SEYCHELLES

ETHIOPIASOUTHSUDAN

CAPEVERDE

CO

NG

O

TOGO


CENTRALAFRICAN REP.

DEMOCRATICREPUBLIC

OF CONGO

COMOROS

SOMALIA

ANGOLA

SOUTHAFRICA

MADAGASCAR

BOTSWANA

ZIMBABWE

ZAMBIA

ESWATINI(SWAZILAND)

LESOTHO

MALAWI

TANZANIA

KENYAUGANDA

RWANDABURUNDI

GABON

NAMIBIA

DJIBOUTI

ERITREASUDAN

CHAD

NIGER

EQUAT. GUINEA


CAMEROON

MALI

ALGERIALIBYA

EGYPT

TUNISIA

MOROCCO

MAURITANIA

MAURITIUS

SENEGALGAMBIA


SIERRA LEONE

LIBERIA

CïTEDÕIVOIRE

BENIN

MO

ZAM

BIQUE

BURKINAFASO

GHANA NIGERIA

SEYCHELLES

ETHIOPIASOUTHSUDAN

CAPEVERDE

CO

NG

O

TOGO


CENTRALAFRICAN REP.

DEMOCRATICREPUBLIC

OF CONGO

COMOROS

SOMALIA

ESWATINI(SWAZILAND)

$ per capita:

$60.1 +

$35.1 Ð $60.0

$20.1 Ð $35.0

$10.1 Ð $20.0

$7.1 Ð $10.0

$2.1 Ð $7.0

$0 Ð $2.0

No data

% of GDP:

4.01% +

2.01% Ð 4.00%

1.01% Ð 2.00%

0.71% Ð 1.00%

0.21% Ð 0.70%

0 Ð 0.20%

No data

North Africa

West Africa

Central Africa

East Africa

Southern Africa

RSA

Kenya$1,208m(33.3%)

Tanzania$1,235m(34.1%)

Othercountries$110m(3.0%)

Ethiopia$749m(20.7%)

Uganda$324m(8.9%)

DemocraticRep. of Congo

$189m(13.3%)

Burundi$49m(3.4%)


Rwanda$489m(34.4%)

Cameroon$411m

(28.9%)

Congo$160m(11.3%)

Egypt$1,727m(47.3%)

Tunisia$1,095m(30.0%)

Othercountries

$1m(0.03%)Morocco

$831m(22.7%)

Senegal$1,030m(23.4%)

Niger$178m (4.1%)


Nigeria$416m (9.5%)

Ghana$348m (7.9%)

C�tedÕIvoire$1,169m(26.6%)

Burkina Faso$242m (5.5%)

Zambia$561m(20.6%)

Namibia$191m (7.0%)


Mozambique$450m (16.5%)

Angola$219m (8.0%)

Madagascar$822m (30.2%)

RSA$495m(15.4%)

Togo$129m (2.9%)

Benin$128m (2.9%) Cent. African Rep.

$79m (5.6%)

Mali$434m(9.9%)

Liberia$126m (2.9%)

Malawi$262m(9.6%)

Botswana$152m (5.6%)

Madagascar$822m (25.6%)

Zambia$561m(17.4%)

Mozambique$450m (14.0%)

Malawi$262m(8.1%)

Angola$219m (6.8%)

Namibia $191m (5.9%)Botswana $152m (4.7%)


Total:$3,625m

Total:$1,423m

Total:$3,654m

Total:$4,399m

Total:$2,723m


Total:$3,218m

Southern Africaincluding RSA

commitments in 2017 compared to theAfrican average of $23.9/capita whilefinancial commitments made toMadagascar in 2017 were equal to7.8% of the country’s GDP,significantly greater than the Africanaverage of 1.9% (Figure 41, below).

Recipients of significant amounts offunding for transport projects in 2017were Zambia ($399m), Tunisia($489m), Tanzania ($810m), SouthAfrica ($288m), Senegal ($752m),Madagascar ($728m), Kenya ($555m),and Côte d’Ivoire ($650m).

Of the $4.5bn committed to the waterand sanitation sector, Egypt was thelargest recipient ($584m) followed byEthiopia ($470m), Tunisia ($419m)and Kenya ($352m). Large countriesthat received limited funding to thewater and sanitation sector includeDemocratic Republic of Congo ($2.9m)and Zambia ($10m).

Egypt received the largest commit-ments to energy sector projects in2017, amounting to $1.1bn. Severalcountries with low GDPs andpopulations received relatively highlevels of commitments to their energysectors in 2017, including Mali($156m), Senegal ($153m) and Niger($145m). n

Figure 40 ICA members’ reportedcountry-levelcommitments byregion, 2017

Figure 41ICA members’ reported 2017 country-level commitments: $ spend per capita (left) and as percentage of GDP (above)


AfDBCommitments of around $3.4bn werereported in 2017 by AfDB, lower thanthe $4bn reported in 2016, $4.2bn in2015 and $3.6bn in 2014.

The AfDB committed $1.4bn totransport projects, less than the$1.7bn reported in 2016 and $2.4bn in2015 but on a par with the $1.4bncommitted in 2014. One of the AfDB’slargest transport sector commitmentswent to the Uganda-KenyaKapchorwa-Suam-Kitale and EldoretBypass Roads project. Another largeloan supported the Dakar-Diamniadiosegment of Senegal’s project for anexpress train link between the capitaland its international airport.

Energy commitments in 2017 at$1.4bn have increased from the$882m reported by AfDB in theprevious year and $1.1bn in 2015,though less than the $1.7bn reportedin 2014. The AfDB made severalcommitments and disbursements toPIDA/PAP projects in the energysector. Projects supported by newcommitments included the CentralAfrican Interconnection and the WestAfrica Power Transmission Corridor.It disbursed funds to projects in theWest Africa Power TransmissionCorridor, North–South PowerTransmission Corridor, CentralAfrican Interconnection and North–South Power Transmission Corridor.Disbursements were also made to twomajor regional power generationprojects, Inga III Hydro and RusumoFalls.

ICT commitments for 2017 amountedto $100m which is less than thecommitments of $119m in 2016 and$122m in 2015. The AfDB’s ICTcommitments in 2017 focused on theCentral Africa Fibre-Optic BackboneProject (CAB), specifically the CentralAfrican Republic component of thismajor regional project.

CanadaWith total commitments of $19m,Canada focused once more in 2017 onsupport for energy projects with 72%or $14m of its commitments going tothe sector, more than double theamount committed in 2016. Multi-sector projects attracted $5m ofcommitments. ICT projects accountedfor $351,000 and water and sanitationprojects for $312,000 of commitments.All of Canada’s support is ODA.

Of its $140.3m 2016 commitments,Canada committed $135.4m to energyand $4.6m to water and sanitationoperations and $312,986 to ICTprojects.

In 2017 Canada announced it wascreating a development financeinstitution with an initialcapitalisation of C$300m to be housedwithin Canada’s Export DevelopmentCorporation (EDC).

The Development Finance InstituteCanada (DFIC) has been builtprogressively since the 2017announcement and is now operatingas a wholly owned subsidiary of EDCunder the FinDev Canada brand.

FinDev Canada’s mandate is tosupport the growth and sustainabilityof businesses in developing markets.It aims to fill the gap betweencommercial support and developmentassistance by supporting privatesector activity where it contributes tosustainable development. It aims to befinancially sustainable by generatingreturns on its loans and investments,and to have a favourable economicand social impact in the communitieswhere its clients operate.

In addition, FinDev Canada has amandate to provide financial services tothe private sector in developingcountries with the aim of combatingpoverty through economic growth.Areas of focus will include greengrowth, agribusiness, and support forsmall and medium-sized enterprisesthrough local financial institutions

with specific goals to generate economicdevelopment by creating jobs,promoting women’s economicempowerment, and action to combatclimate change.

Global Affairs Canada managesCanada’s international developmentand humanitarian assistance.Canada’s priorities for Sub-SaharanAfrica are providing developmentassistance, promoting democracy,promoting peace and security andincreasing commercial and economicties. International development effortsin Sub-Saharan Africa are focused onten countries: Benin, Burkina Faso,Democratic Republic of Congo,Ethiopia, Ghana, Mali, Mozambique,Senegal, South Sudan and Tanzania.In North Africa, Canada works withEgypt, Tunisia and Morocco.

Canada also works with other Africancountries where challenges benefitfrom regional approaches, and withcontinental institutions such as theAfrican Union and the AfDB, as wellas regional economic com-munities.

DBSADBSA committed $497m to Africa’sinfrastructure in 2017. The majorityof this ($381m) targeted the transportsector. Multi-sector projects attracted$81m of commitments while $28mtargeted the energy sector. The ICTand water sectors saw commitmentsof $140m and $5m, respectively. In2016, energy sector projects receivedthe most commitments ($544.8m)followed by multi-sector ($511.5m).DBSA’s disbursements in 2017amounted to $912m, slightly less thanthe $1.2bn reported in each of theprevious two years.

DBSA manages the South Africangovernment and EU developedInfrastructure Investment Pro-gramme for South Africa and SADC’sProject Preparation and DevelopmentFacility (PPDF) which is funded byGermany (through KfW) and the EU.

4.10 ICA Member Activities


ICA Member Activities

The aim of the PPDF is to assistSADC in addressing the imple-mentation of the SADC RegionalInfrastructure Development MasterPlan, which will promote andcontribute to enhancing regionaleconomic integration in the SADCregion.

It also manages the New EconomicPartnership for Africa’s DevelopmentProject Preparation and FeasibilityStudy and was fund manager of thecompleted and closed DFID TripartiteTrust Account (TTA). The TTAfinanced priority infrastructureprojects through pooled donor andother funds. All remaining funds werereturned to DFID in February 2018.

DBSA disbursed $6.9m to RavinalaAirports which holds the concession tooperate airports in Antananarivo,Madagascar’s capital and Nosy Be, thecountry’s main tourist destination.Four DFIs have collaborated tosupport the improvement andexpansion of the airports. As well asDBSA, the project is supported by theIFC, Proparco, and OPEC Fund forInternational Development (OFID).Support has also been forthcomingfrom the Emerging Africa Infra-structure Fund (EAIF) for the $245mprogramme of work. Constructionwork in the project is underway at theIvato international airport inAntananarivo and the Fasceneinternational airport in Nosy Be.

DBSA also supports the Kathu SolarPark, a 100MW greenfield Concen-trated Solar Power (CSP) projectlocated in the town of Kathu in theNorthern Cape Province of SouthAfrica. Shareholders include Engie ofFrance, South Africa’s GovernmentEmployees Pension Fund and SIOCCommunity Development Trust,Development Bank of Southern AfricaLimited, Investec Bank Limited,Lereko Metier and the Kathu Trust.

European InvestmentBankAmongst several sizeablecommitments by EIB in 2017 was a€219m ($252m) financing for thedepollution of the Kitchener Drain,one of the most severely polluteddrains in the Egyptian Nile Delta.

The project, which has also receivedfinancing from European Bank forReconstruction and Development(EBRD), comprises: (i) wastewater &sanitation; (ii) solid waste, and (iii)drain infrastructure rehabilitation. Theproject is expected to enhance healthand social conditions in thesurrounding areas by improvingwastewater and sanitation; solid waste,and drain infrastructure rehabilitation.

The project is expected to be co-financed by EIB and EBRD, with EIBfinancing focusing on the wastewaterand sanitation project componentsand EBRD financing focusing on thesolid waste and drain rehabilitationproject components. The EIB andEBRD will be seeking an EU grantcontribution from the NeighbourhoodInvestment Facility for this project.

EIB in 2017 disbursed €75m ($86m)for the conversion of the existing opencycle gas turbine power plant to acombined cycle gas turbine powerplant in El Shabab, Egypt. Whencompleted, the conversion will allowthe project promoter, EgyptianElectricity Holding Company, toincrease generating capacity at theplant from 1,000MW to 1,500MW. Theproject employs modern, commerciallyproven, combined-cycle powergeneration technology to increase theoutput and fuel efficiency of anexisting power plant project. It isexpected to contribute to meeting theincreasing electricity demand at acompetitive cost, with relatively lowenvironmental impact.

EIB committed €166m ($190m) for theconstruction of a 98.9km long two-lane each-way motorway in central

Tunisia between the cities of Sbikhaand Jelma.

The project benefits expected includetime savings and vehicle operatingcost reductions for road users on thecorridor, due to enhanced roadcapacity.

In Madagascar, EIB committed to a€110m ($122m) loan and EU-AITF a€109m ($122m) grant for therehabilitation of several priority roadsub-sections in the northern andsouthern parts of Madagascar,allowing access to ports and unlockingeconomic growth potential in theregion. The project will improvetransport connections in the northernand southern parts of the country,which will help the businessenvironment and strengthen anddevelop the private sector. Themodernisation of the road networkwill increase people’s mobility andsupport the transportation of goods,thereby unlocking growth potential inthe areas covered by the project.

EU-Africa InfrastructureTrust Fund/AIPEU-AITF provided new commitmentsof $76.3m in 2017 compared with$64m in 2016 and $156m in 2015. Themajority ($66m) of 2016 commitmentswere directed at energy projects, whiletransport projects received $10m.

Disbursements in 2017 amounted to$28m compared with $38m in theprevious year. The fund reported de-commitments of $37m, of which $20mrelated to transport and $17m toenergy projects.

Around two-thirds of EU-AITFcommitments are directed atPIDA/PAP projects (see p40 on ICAmembers’ participation in PIDA/PAP).

The Africa Infrastructure Platform,formerly known as the EU-AfricaInvestment Facility (AfIF), is a newblending mechanism. It startedoperating in November 2015 andcombines grants with other resources


such as loans from DFIs to leverageadditional financing for developmentand increase the impact of EU aid.AIP provides its support throughinvestment grants, technicalassistance, risk capital and other risksharing instruments. It willprogressively replace EU-AITF, aprocess that began in mid-2015.

The fund provides technicalassistance for preparatory work,project supervision and targetedcapacity building. It provides interestrate subsidies to lower interest ratesand reduce the total amount of debt.

Investment grants are also availableto finance project components or partof an investment, to increase theconcessionality of the financingpackage. AIP also provides financialsupport to guarantee cost financing,equity or quasi-equity investments orparticipation and risk-sharinginstruments.

FranceFrance reported commitments anddisbursements via AFD, its Proparcosubsidiary dedicated to private sectorsupport and Fonds Français pourl’Environnement Mondial (FrenchFund for the Global Environment).

In 2017, commitments by Francetotalled $2.1bn, in line with the $2.8bn,$2.5bn and $2.4bn committed in eachof the successive previous years.Commitments were spread acrossthree sectors, with energy projectsattracting $901m or 42% of the totalamount committed. Transport projectsreceived $672m or 32% of commitmentswhile water and sanitation projectsattracted $550m or 26% of the totalamount committed by France.

France uses blended fundssignificantly. Of its 2017 commitments$272m or 13% comprised blendedfunds while grant funding accountedfor $49m or 2%.

AFD is investing with CDC in a€600m ($691m) investment fund. The

agency aims to play a catalytic role inthe financing of infrastructureprojects, mainly in Africa, throughlong-term equity investment inenergy, transport, telecommunicationsand digital infrastructure.

The fund aims to facilitate the designand implementation of low-carbonprojects. With average investments ofbetween €15m-€50m ($17m-$58m),AFD and CDC plan to leverage morethan €6bn of investments.

The alliance intends to make use ofCDC’s relationships with many publicbanks and institutions and itspresence in many countries throughshareholdings and subsidiaries.

The AFD network meanwhile, with its85 agencies as well as geographicaldepartments at its headquarters, willsupply CDC with information andanalysis and share its expertise on therealities of financing needs andexisting stakeholders.

GermanyGermany reported $838m ofcommitments via KfW ($685m), GIZ($132m) and Deutsche Investitions-und Entwicklungsgesellschaft (DEG –$21m). Most 2017 commitmentstargeted water ($294m or 35%)followed by transport ($263m or 31%)and energy ($240m or 29%) projects.

KfW, the largest German donor toAfrican infrastructure in 2017,committed 38% of its $685mcommitments to projects in thetransport sector and 35% to water andsanitation operations. Energy projectsattracted 24% of commitments andmulti-sector projects 3% of KfW’s totalcommitments.

New commitments in 2017 from KfWfocusing on PIDA/PAP projectstargeted the Northern MultimodalCorridor in Kenya, the West AfricaPower Transmission Corridor and theRuzizi III hydropower plant.

Of KfW’s disbursements, 59% targetedprojects in the energy sector while 37%

were directed towards operations in thewater and sanitation sector and 4%focused on projects in the transportsector.

KfW makes significant use of blendedfunds. Of its 2017 commitments$113m or 17% comprised the loanelement of blended funds.

Grant funding however accounted for$343m or 50% and loans amounted to$228m or 33% of commitments in theyear.

In 2017 GIZ’s commitments, which ismostly technical assistance andprovided on basis of commission byGermany’s Federal Ministry ofEconomic Cooperation andDevelopment (BMZ), focused mainlyon the energy and water andsanitation sectors, with 55% ofcommitments going to energy and43% of commitments going to waterand sanitation projects. Multi-sectorprojects attracted 2% of GIZ’scommitments.

Of GIZ’s disbursements, 61% targetedprojects in the water and sanitationsector while 37% were directedtowards operations in the energysector and 6% and 2% focused onprojects in the transport sector andmulti-sector projects, respectively.

DEG’s commitments focused entirelyon ICT projects while disbursementswere more or less evenly distributedbetween projects in the ICT andenergy sectors.

GIZ continues to provide support tothe Programme for InfrastructureDevelopment in Africa (PIDA) with acommitment of €2m ($2.3m) in 2017.

GIZ also committed in 2017 to theLake Chad Basin Commission (LCBC)capacity development project. It isinvesting in the institutional reform ofLCBC, the consolidation of planningprocesses, the setting up of amonitoring and evaluation systemand an information system (regionaldatabase), and the improvement ofinternal and external communication.


Disbursements to PIDA/PAP projectsincluded efforts to promote a climatefriendly energy pool in West Africa.

International FinanceCorporationIn 2017, IFC committed $523m, ofwhich $341m or 65% targeted projectsin the energy sector. Multi-sectorprojects attracted $75m or 14% ofcommitments and ICT projects $60mor 12% of commitments. IFCcommitted $46m or 9% to projects inthe transport sector. This compareswith $413m committed in 2016,$246m in 2015 and $621m in 2014.

Total disbursements made by IFC in2017 amounted to $212m of which$86m or 41% went to projects in thetransport sector and $65m or 31% tomulti-sector projects. Energy projectsreceived $41m or 19% and ICTprojects $19m or 9% of disbursements.IFC disbursed $203m in 2016compared with $292m in 2015 and$747m in 2014.

IFC supported the South African cityof Ekurhuleni’s capital investmentprogramme through an investment ofup to $50m (South African randequivalent) in the city’s bond issuanceof around the equivalent of $106m.The investment is aimed at capitalspending to improve and expandpublic infrastructure. The cityproposed capital expenditure tosupport investment in up to 67km ofnew roads and the maintenance ofover 1,300km of existing roads;electrical infrastructure including theconnection of over 6,000 newhouseholds; and water and sanitationinfrastructure including the upgradeof existing infrastructure andinstallation of new water and sewerpipes to expand access to services to1,200 settlements.

IFC and a consortium of other lendershad by 2017 pledged $653m to supportEgypt’s ambitious Benban solarproject. The financing will help 13private companies build and operate

power plants at the site. IFC led afinancing package for the Benbanproject under its Nubian Sunsprogramme, marshalling support froma consortium that included nineinternational banks. The World Bankalso supported reforms to Egypt’selectricity sector and provided thecountry with a $3.2bn loan. TheMultilateral Investment andGuarantee Agency (MIGA) isproviding $210m-worth of politicalrisk insurance to private lenders andinvestors involved in the solar park.

ItalyItaly has provided support toMozambique’s water and sanitationsector with a 2017 commitment of€60m ($69m) for a project designed tobuild and renovate rainwaterdrainage systems in the city ofMaputo. It aims to improve livingconditions and the safety of localpeople. The initiative will enhancehygiene and environmental conditionsand reduce the incidence ofwaterborne illnesses.

This operation confirms the strategicrole of Italy’s newly establisheddevelopment bank, Cassa Depositi ePrestiti (CDP). It operates as part ofItaly’s restructured Ministry ofForeign Affairs and InternationalCooperation (MAECI), which leadsItaly’s development policy.Established in 2016, CDP providestechnical and financial support to theministry and the Italian DevelopmentCooperation Agency (AICS).

CDP can act as an administrativemanager of third-party funds,including Italy’s Revolving Fund forDevelopment Cooperation. It can alsomanage Italian, European andinternational funds, or fundsconnected with EU programmes thatmay involve the private sector.

The Italian agency has adopted ablended finance approach aimed atbringing together various types offunds to provide the most effective

form of development financing. Inaddition, CDP may intervene on itsown initiative, using its ownresources, public/private blending, orother Italian public funds.

AICS is in charge of the execution andmonitoring of all projects inaccordance with the strategicobjectives set by the MAECI. Theagency is largely autonomous andmanages its own budget to providemore operational flexibility.

JapanJapan reported commitments of$2.4bn and disbursements of $4m in2017. Of Japan’s commitments, $1.9bnor 82% were directed at transportprojects, $394m or 17% at water andsanitation projects and $30m or 1% atenergy projects.

This compares with commitments of$2.4bn and disbursements of $58m in2016. In 2015, Japan committed$1.8bn compared with $2bn in 2014.Disbursements in 2015 amounted to$960m compared with $1bn in 2014.

Some of Japan’s largest 2017commitments targeted PIDA/PAPprojects in the transport sector,including the following:

• Toamasina Port development inMadagascar (part of PIDA/PAPSouthern Africa Hub Port and RailProgramme);

• Abidjan Port Cereal Berthconstruction project in Côte d'Ivoire(part of PIDA/PAP West Africa HubPort and Rail Programme);

• Mombasa Port Area RoadDevelopment Project II in Kenya (partof PIDA/PAP Northern MultimodalCorridor);

• Construction of Bridges on N380 inCabo Delgado Province inMozambique (part of PIDA/PAPBeira-Nacala Multimodal Corridors);

• Rehabilitation of port facilities inDakar, Senegal (part of PIDA/PAP

ICA Member Activities


West Africa Hub Port and RailProgramme);

• Upgrade of South-East TansobaBoulevard Bypass in Ouagadougou,Burkina Faso (part of PIDA/PAP TAHprogramme);

• Project finance for the constructionof Nacala Railway and PortInfrastructure in Mozambique andMalawi (part of PIDA/PAP Beira-Nacala Multimodal Corridors).

JBIC committed $1.3bn under a loanagreement in project financing for theconstruction of Nacala Railway andPort Infrastructure in Mozambiqueand Malawi, operations in whichJapan’s Mitsui and Brazilian minerVale hold an equity stake. Valeannounced in March 2017 that it hadcompleted the sale of a stake inMozambique’s Moatize coal project toMitsui. The railway and port project isinternationally co-financed by theAfDB and private financialinstitutions, including SumitomoMitsui Banking Corporation, MizuhoBank, Standard Chartered Bank,Nippon Life Insurance Company,Bank of Tokyo-Mitsubishi andSumitomo Mitsui Trust Bank. Thesyndicated loans bring the total co-financing amount to $2.7bn.

Expansion of Madagascar’s largestcommercial port at Toamasina is theaim of one of JICA’s largest ($400m)loans. By expanding the port thisproject will strengthen Madagascar’sability to meet increasing demand forfreight, thereby expanding andimproving the efficiency of goods flowsand contributing to its economicdevelopment. The ODA loan will helpfinance public works such asbreakwater expansion, construction ofa container freight berth, dredgingwork and expansion of the containeryard. Part of the loan will be used topay for consulting services, includingdetailed design work, biddingassistance and constructionsupervision.

United KingdomIn 2017, the UK committed $623m, ofwhich $246m or 29% targeted projectsin the energy sector. Water and multi-sector projects each accounted for 16%of the UK’s contributions withcommitments of $134m and $137m,respectively. Commitments totransport operations amounted to$80m or 10% and ICT projects $26mor 3% of the UK’s total contribution.Direct grant funding from DFID andequity investments by CDC totalled$537m in 2016 and $288m in 2015.

The UK’s 2017 commitmentscomprise $280m direct grant fundingfrom DFID and $344m in equityinvestments by CDC Group.

In 2017, DFID committed 48% of itsfunds to water ($134m) with 29% offunds going to transport ($80m), 12%to multi-sector ($34m), 11% to energy($33.7m) and 1% to ICT ($7.7m).

In the same year DFID madedisbursements of $294m, of which34% went to water ($101m) with 22%to energy ($65m), 20% to multi-sector($58m), 17% to transport ($49m), and7% to ICT ($21m).

In comparison, in 2016 DFIDdisbursed $291m, of which the mostwent to water ($109m) followed bytransport ($78m), multi-sector ($57m),energy ($41m) and ICT ($6m).

Of CDC’s total commitments of$344m, $216m or 63% is directed atenergy operations while $103m or30% supports multi-sector activitiesand $25m or 7% is focused on the ICTsector.

Pan-African commitments accountedfor 34% of CDC’s investments while26% targeted North African activities.The UK’s DFI committed 7% ofinvestments to Southern Africa.

Data for this year’s report wereprovided by DFID and obtained fromthe UK’s DFI, CDC Group. UKcontributions not reported on in thisreport include commitments to

multilateral institutions, includingthe AfDB and the EU. DFID reportingdoes however include commitments tothe Private Infrastructure Develop-ment Group.

World BankThe World Bank’s 2017 commitmentsamounted to $7bn, of which $2.4bnor 34% targeted projects andprogrammes in the energy sector. Itcommitted $2.2bn or 31% to transportand $2.1bn or 20% to water andsanitation activities. Commitments toICT amounted to $260m or 4% of totalcommitments.

Disbursements by the World Bank in2017 amounted to $4.1bn, of which$1.9bn or 45% were directed towardsenergy projects. The transport andwater sectors received around $1bn or24% of the World Bank’s disburse-ments in the year. ICT disbursementsamounted to $260m or 6% of the totaldisbursed in the year.

Notable commitments in the energysector included $325m to theElectricity Transmission and AccessProject to contribute to theimprovement of the efficiency andreliability of electricity supply andincreased access to electricity in Côted’Ivoire. The Improved RuralConnectivity project in Zambia, whichaims to improve rural roadaccessibility, received a $200mcommitment.

A commitment of $300m was providedto the Water and SanitationDevelopment Project to improve watersupply and sanitation services inselected coastal and northeasternregions in Kenya. This projectinvolves the rehabilitation andexpansion of urban water supply andsanitation services.

In the transport sector the WorldBank supported the Dar es SalaamMaritime Gateway Project inTanzania with a commitment of$345m to improve the effectivenessand efficiency of the Port of Dar esSalaam. n


This chapter looks at identifiedspending commitments made in2017 towards Africa’s infra-structure by a range of actorsthat are not ICA members. As agroup, Africa’s national govern-ments provided the largest blockof funding for the continent’sinfrastructure.

The methodology for collecting andcompiling data on state spending forinfrastructure has been improved in Infrastructure Financing Trends in Africa, 2017. The improvedmethodology is designed to capturespending not only at a national levelbut also at a subnational level, whereit can be identified that subnationalspending has not been accounted forin national or federal budgets. Toensure consistency, this improvementrequired a restatement of 2016 data toinclude the same subnational datathat are included in this report.

In 2017, total identifiable infra-structure capital expenditureallocations for 47 African nationalgovernment budgets amounted to$34.3bn. This compares with a revised$30.7bn for 49 countries, in 2016. Therevised total was reached by increasingthe $26.3bn in the 2016 report by$4.4bn of newly identified governmentbudget allocations. The revisionincludes the addition of budget data forCentral African Republic, Chad and

Equatorial Guinea, and additionalstate subnational spending identifiedfor RSA.

To minimise double counting, and toimprove the accuracy of the data asmuch as possible, identifiable externalfunding was removed. Double countingremains a possibility.

Around 10% of budget commitmentswere classified as unallocated where itis known that capital expenditurecommitments fall into the ICA’sdefinition but it is not possible toallocate to a specific sector.

TransportAs in previous years, transportaccounted for the largest proportion ofthe combined infrastructure budgetallocations across Africa, claiming two-thirds of all funds in 2017, and a higherproportion than the 53% of Africa’sbudgets allocated to transport in theprevious year. Spending on thetransport sector grew by 23%,accounting for much of the 11% overallgrowth for infrastructure spendingacross all sectors.

Despite this large overall growth,changes in individual regions andcountries were inconsistent. Forexample, while transport allocationsdoubled in East Africa and SouthernAfrica and increased by one-third inNorth Africa, there was little change inallocations in West Africa and South

Africa. In Central Africa allocationsdecreased by 38%. These regionalvariations are reflected in the followingcountry-level variations: in Tunisia andGabon transport sector spending grewsignificantly, while in Chad andCameroon the allocations decreased.

WaterAllocations to water and sanitationprojects amounted to $5.9bn,accounting for 19% of total allocations,thus making it the sector with thesecond highest contributions to 2017total infrastructure spending across allsectors. This is minor decrease from thewater allocations for 2016. Threecountries (Burkina Faso, Guinea andNiger) prioritised the water sector. Inmany countries the transport sector isgiven top priority.

Some countries allocated their budgetsin favour of water-based infrastructure,without prioritising it. For example,RSA allocated 34% of its infrastructurebudget.

Regional changes in spending on thewater sector vary. This is especially thecase with Central Africa where suchspending declined by 67% between2016 and 2017. In West and East Africathe growth in spending on water wassignificant.

There were notable changes in theallocation of funds for the water sectorsin several countries between 2016 and

5. Other Public Sources ofFinancing

5.1 African State Spending on Infrastructure


2013 2014 2015 2016 2017

40

30

25

20

$bn

15

10

5

0

35

15.0

17.6

12.9

3.5

5.1

5.2

6.9

0.8

2.6

3.2

1.1

7.5

2.1

0.64.8

2.1

5.6

5.9

0.6

20.1

16.3

6.1

4.4

0.9

2.9

Multi-sector/unallocated

ICT

Energy

Water

Transport

34.5

24.0

30.7Total:30.5

34.3

North Africa$6.5bn (19.0%)

East Africa$8.4bn (24.4%)

RSA$6.7bn (19.5%)

West Africa$3.6bn (10.5%)


Central Africa$2.9bn (8.5%)

1

2017. For example, in Zambia, waterspending rose from 0.2% of itsinfrastructure budget to 8.7%. Thesignificant increase in Zambia isconsistent with the government’sefforts to achieve national targets forimproved access to water andsanitation, of 100% and 90%,respectively by 2030.

EnergyThe share of the energy sector inoverall infrastructure spending is 18%thus making it slightly lower than the

Botswana’s flagship projects havereceived increased attention. Inparticular, the allocations for theNorth-West electricity grid, ruralelectrification and emergency powersupply are notable. The main purposeof the increased attention to the energysector is to expand the national grid toprovide electricity to the 20% of villagesthat are presently not servedadequately by the existing electricitygrid. In September 2016, thegovernment of Botswana signalled anew commitment to introduce localrenewable energy sources, along with aplan to expand the national grid usinggreen technology.

ICTICT projects received the lowest statebudget allocations across all sectorswith $600m committed. This amountis somewhat consistent with commit-ments in previous years. It is however33% less than the unusually high$894m of ICT allocations reported in2016.

Multi-sector and UnallocatedMulti-sector and unallocated budgetallocations have been merged in thisyear’s report to facilitate consistenttrend analysis. In 2017 there was a25.5% drop compared with 2016 inallocations to these categories. n

share of the water sector. Following a20.8% decline in the energy sector in2016, budget allocations to energyinfrastructure are on the rise andincreased by 26% in 2017.

Regional trends indicate growth inenergy sector spending in all regions.The exception is Central Africa wherespending for the energy sector declinedby 39%. In most countries there issteady growth in energy sectorspending. Botswana’s allocations forthe energy sector have increasedsignificantly by 700%. Several of

Figure 42 (left)Nationalgovernmentbudgetallocations bysector, 2013-2017

Figure 43(below, right)Nationalgovernmentbudgetallocations byregion, 2017


In the the following tables, identifiable state spending on infrastructure by region is presented. Thecountries where no 2017 data were available are Djibouti, Equatorial Guinea, Eritrea, Guinea Bissau,Gambia, Libya and Sudan. In addition, the tables show, where identifiable, how external financing has beenused to supplement state budgets. It should be noted that data given for external financing are mainlyindicative. This is because many countries do not separate internal and external funding. In other words,data listed under the heading of internal funding may also include undisclosed external funding.

Regional State Spending on Infrastructure in 2017 ($m)

North AfricaInternal

Financing($m)

ExternalFinancing

($m)

Internal &External

Financing($m)

Algeria 817.1 0.0 817.1

Egypt 3,730.3 3,704.3 7,434.6

Mauritania 102.6 0.0 102.6

Morocco 1,134.7 0.0 1,134.7

Tunisia 737.5 0.0 737.5

Totals 6,522.3 3,704.3 10,226.6

South AfricaInternal

Financing($m)

ExternalFinancing

($m)

Internal &External

Financing($m)

South Africa 6,698.7 0.0 6,698.7

West AfricaInternal

Financing($m)

ExternalFinancing

($m)

Internal &External

Financing($m)

Benin 244.2 156.0 400.2

Burkina Faso 304.1 0.0 304.1

Cape Verde 49.0 0.0 49.0

Cote d'Ivoire 368.4 78.1 446.5

Ghana 243.4 0.0 243.4

Guinea 137.5 0.0 137.5

Liberia 0.2 0.7 0.9

Mali 165.8 0.0 165.8

Niger 8.9 0.0 8.9

Nigeria 1,074.0 0.0 1,074.0

Senegal 769.5 0.0 769.5

Sierra Leone 37.2 64.1 101.3

Togo 218.3 0.0 218.3

Totals 3,620.5 299.0 3,919.5

CentralAfrica

InternalFinancing

($m)

ExternalFinancing

($m)

Internal &External

Financing($m)

Burundi 2.3 0.0 2.3

Cameroon 1,242.4 0.0 1,242.4

CentralAfricanRepublic

7.9 35.3 43.1

Chad 46.3 93.7 140.1

Congo-B 303.9 0.0 303.9

DRC 523.8 0.0 523.8EquatorialGuinea 0.0 0.0 0.0

Gabon 366.3 0.0 366.3

Rwanda 433.2 0.0 433.2São Tomé andPríncipe 0.0 3.9 3.9

Totals 2,926.1 132.9 3,059.1

SouthernAfrica

InternalFinancing

($m)

ExternalFinancing

($m)

Internal &External

Financing($m)

Angola 3,545.3 0.0 3,545.3

Botswana 465.7 0.0 465.7

Comoros 0.2 25.4 25.7

Lesotho 94.8 89.6 184.4

Madagascar 36.8 77.2 114.0

Malawi 11.8 166.8 178.6

Mauritius 128.4 0.0 128.4

Mozambique 106.7 470.2 576.9

Namibia 334.0 15.6 349.5

Swaziland 173.7 0.0 173.7

Zambia 990.2 0.0 990.2

Zimbabwe 308.1 0.0 308.1

Totals 6,195.7 844.8 7,040.5

East AfricaInternal

Financing($m)

ExternalFinancing

($m)

Internal &External

Financing($m)

Ethiopia 2,359.1 0.0 2,359.1

Kenya 1,977.1 2,076.0 4,053.1

Seychelles 51.5 0.0 51.5

Somalia 1.4 0.0 1.4

South Sudan 4.0 0.0 4.0

Tanzania 3,429.2 0.0 3,429.2

Uganda 559.8 569.5 1,129.3

Totals 8,382.1 2,645.4 11,027.5


RSA 8.4%

ANGOLA

SOUTHAFRICA

MADAGASCAR

BOTSWANA

ZIMBABWE

ZAMBIA

LESOTHO

MALAWI

TANZANIA

KENYAUGANDA

RWANDABURUNDI

GABON

NAMIBIA

DJIBOUTI

ERITREASUDAN

CHAD

NIGER

EQUAT. GUINEA


CAMEROON

MALI

ALGERIALIBYA

EGYPT

TUNISIA

MOROCCO

MAURITANIA

MAURITIUS

SENEGALGAMBIA


SIERRA LEONE

LIBERIA

CïTEDÕIVOIRE

BENIN

MO

ZAM

BIQUE

BURKINAFASO

GHANA NIGERIA

SEYCHELLES

ETHIOPIASOUTHSUDAN

CAPEVERDE

CO

NG

O

TOGO


CENTRALAFRICAN REP.

DEMOCRATICREPUBLIC

OF CONGO

COMOROS

SOMALIA

ANGOLA

SOUTHAFRICA

MADAGASCAR

BOTSWANA

ZIMBABWE

ZAMBIA

ESWATINI(SWAZILAND)

LESOTHO

MALAWI

TANZANIA

KENYAUGANDA

RWANDABURUNDI

GABON

NAMIBIA

DJIBOUTI

ERITREASUDAN

CHAD

NIGER

EQUAT. GUINEA


CAMEROON

MALI

ALGERIALIBYA

EGYPT

TUNISIA

MOROCCO

MAURITANIA

MAURITIUS

SENEGALGAMBIA


SIERRA LEONE

LIBERIA

CïTEDÕIVOIRE

BENIN

MO

ZAM

BIQUE

BURKINAFASO

GHANA NIGERIA

SEYCHELLES

ETHIOPIASOUTHSUDAN

CAPEVERDE

CO

NG

O

TOGO


CENTRALAFRICAN REP.

DEMOCRATICREPUBLIC

OF CONGO

COMOROS

SOMALIA

EastAfrica32.9%

West Africa29.4%

North Africa35.6%

CentralAfrica

Ð37.9%

Regionalaveragespercapita

Southern Africa $54.7

East Africa $49.7

North Africa $32.4

West Africa $23.1

Central Africa $24.0

West Africa1.0%

Southern Africaexcluding RSA 50.7%

CentralAfrica

Ð67.5%

West Africa0.4% Central

AfricaÐ39.4%

RSA 0.9%

North Africa69.8%

EastAfrica

149.0%

RSA 11.0%

EastAfrica51.9%

RSA 5.7%

North AfricaÐ16.3%

Southern Africaexcluding RSA Ð27.8%

North Africa51.2%

EastAfrica6.4%

Southern Africaexcluding RSA 104.4%

West Africa24.8% Central

AfricaÐ69.9%

Southern Africaexcluding RSA Ð88.6%

ESWATINI(SWAZILAND)

$ per capita:

$100.1 +

$50.1 Ð $100.0

$35.1 Ð $50.0

$20.1 Ð $35.0

$10.1 Ð $20.0

$5.1 Ð $10.0

$0 Ð $5.0

No data

Percentage increase/decrease(2017 vs 2016) in actual amount

% of total infrastructure budget:

35.1% +

25.1% Ð 35.0%

15.1% Ð 25.0%

8.1% Ð 15.0%

3.1% Ð 8.0%

0 Ð 3.0%

% of GDP:

4.01% +

2.01% Ð 4.00%

1.01% Ð 2.00%

0.71% Ð 1.00%

0.21% Ð 0.70%

0 Ð 0.20%

No data

TRANSPORT WATER

ENERGY ICT

Transport$20,117m(58.6%)Water

$5,876m(17.1%)

Energy$5,581m(16.3%)

Multi-sector/unallocated$2,172m(6.3%)

ICT$600m

(1.7%)

Total:$34,345m

Figures 44 and 45Allocations to infrastructure in nationalbudgets, 2017, by $ per capita (top left)and percentage of GDP (top right)

Figure 46 Percentage of infrastructure allocationsin national budgets by sector andregion for 2017, with year-on-yearchange indicated (left)

Figure 47 Total identifiable 2017 infrastructurecapital expenditure allocations innational government budgets, by sector


Spending per Capita and as a Percentage of GDP

Identifiable Internal Infrastructure Spending

Top 20 % of GDP

Tanzania 5.57%

Rwanda 4.86%

Senegal 4.79%

Togo 4.55%

Swaziland 4.31%

Cameroon 4.05%

Congo-B 3.90%

Zambia 3.87%

Lesotho 3.48%

Seychelles 3.48%

Ethiopia 2.96%

Angola 2.86%

São Tomé and Príncipe 2.84%

Cape Verde 2.83%

Botswana 2.78%

Namibia 2.66%

Benin 2.60%

Gabon 2.53%

Kenya 2.52%

Burkina Faso 2.31%

Identifiable Internal Infrastructure Spending

Top 20 ($ per capita)

Seychelles 549

Botswana 210

Gabon 207

Namibia 134

South Africa 122

Angola 121

Swaziland 118

Mauritius 95

Cape Verde 87

Tunisia 65

Tanzania 64

Zambia 62

Congo-B 61

São Tomé and Príncipe 53

Senegal 52

Cameroon 50

Lesotho 48

Kenya 42

Egypt 38

Rwanda 36

The following tables show the top 20 countries interms of identifiable internal infrastructurespending as a percentage of GDP and identifiableinternal infrastructure spending per capita. As withall the data in this section, figures should be takenas indicative as some state spending identified asinternally-financed may benefit from externalfunding that may have been reported in this orprevious editions, or may be reported in futureeditions of Infrastructure Financing Trends inAfrica.

As expected, 16 countries feature in both top 20 rankings.The exceptions are Benin, Burkina Faso, Ethiopia and Togowhich feature in the top 20 countries in terms of identifiableinternal infrastructure spending as a percentage of GDP butnot in the top 20 of identifiable internal infrastructurespending per capita. Egypt, Mauritius, South Africa andTunisia feature in the top 20 countries in terms of

identifiable internal infrastructure spending per capita butare not ranked similarly in terms of identifiable internalinfrastructure spending as a percentage of GDP.

Although they do not appear in both lists, the rankings ofBenin, Burkina Faso and Egypt are quite close, but thedifferences in rankings amongst the other countries notedin the previous paragraph are quite pronounced.

The biggest differences are seen with Mauritius, RSA andTunisia that ranked substantially higher in terms of percapita spending compared with infrastructure spending as apercentage of GDP. Togo and Ethiopia meanwhile ranksubstantially higher in terms of infrastructure spending asa percentage of GDP compared with per capita spending.

Internally consistent data sets have now been built for sixyears, and trends are noticeable. Southern Africa, includingRSA is the region spending consistently more oninfrastructure than other regions on a per capita basis. n


Subnational Financing

Nigerian State Funding forInfrastructureNigeria’s infrastructure demon-strates how in some countries,subnational financing exceedsfederal funding. Nigeria’s stateinvestments in infrastructureamount to considerably more thanthe sums allocated to infra-structure in the nation’s federalbudget, which are reported inInfrastructure Financing Trendsin Africa, 2017.

Nigeria’s infrastructure developmentis funded at a federal level and by thecountry’s 36 states. On the other hand,Nigeria’s 774 local governments aretasked with the construction andmaintenance of roads, streets, drains,public transportation and refusedisposal.

Federal funding for infrastructure inNigeria was eclipsed by state-levelfunding in 2017, with the 26 of the 36states for which sufficiently detaileddata was available cumulativelyallocating more than double the

amount of federal budget allocations toinfrastructure expenditure. The 26state budgets allocated $2.6bn toinfrastructure while the federal budgetallocation was $1.1bn in the year.

The following table shows that stateallocations for infrastructure in 2017were weighted mostly towards thetransport sector, which accounted forover 77% of identified infrastructurespending. Water Infrastructure sawthe second highest amount ofallocations (16%), followed by energy(5%), and finally ICT (3%). n

In several African countries, state spending on infrastructure is substantially made at a state, provincial,municipal, city or local level rather, than at a federal level. Nigeria and South Africa fall into this category.

South African StateFunding for InfrastructureSouth Africa’s spending is higherdue to improved reporting.Whereas previous years recordedonly national financing, the SouthAfrican treasury has nowpublished data that combinesinfrastructure financed atnational, provincial and localgovernment level.

Provinces and municipalities areresponsible for providing roads,electricity, water and municipalinfrastructure services. They have theautonomy to allocate resources to

meet basic needs and respond toprovincial and local priorities, whilegiving effect to national objectives.This year’s data on South Africa’sinfrastructure includes national,provincial and local governmentsleading to total infrastructurespending of $6.6bn.

The budgets of state-owned powerutility Eskom and rail, port andpipeline Transnet are also publishedby South Africa. Their budgets are not,however included in the overall data inInfrastructure Financing Trends inAfrica, 2017 because not allinvestments by state-utilities arefunded from the public purse. For

example, they may be funded by bondissues, commercial loans or profitsretained. In this regard, according todata compiled by Bloomberg Eskomissued a total of 3.8bn rand ($250m) ofdebt in 2017. Another reason forexcluding state utilities from thissection is the possibility of doublecounting. Eskom, for example, in 2010received a $3.75bn commitment fromthe World Bank, which was reported inICA data for that year. InInfrastructure Financing Trends inAfrica, 2015, a $1.5bn loan from ChinaDevelopment Bank to Transnet wasreported. n

Nigerian State Spending on Infrastructure ($m)

State Total Rank based on GDP(as of 2010)

Lagos 401.7 1Rivers 58.8 2Delta 149.6 3Kano 196.7 6Edo 7.7 7Kaduna 111.7 10Abia 77.6 12Ondo 30.6 13Osun 82.3 14Anambra 205.2 16Katsina 110.0 17Niger 23.2 18Borno 101.7 19

State Total Rank based on GDP(as of 2010)

Plateau 67.7 20Bauchi 103.2 22Kogi 143.0 23Adamawa 160.1 24Zamfara 66.9 27Kwara 42.0 28Kebbi 71.0 30Nasarawa 22.7 31Jigawa 93.5 32Ekiti 37.3 33Ebonyi 135.7 34Gombe 43.4 35Yobe 53.9 36


5.2 China

Chinese announced investmentsin Africa bounced back in 2017 to$19.4bn compared with $6.4bn in2016. In 2015 investments byChina amounted to $20.9bn. Thisbrings the seven-year average ofChinese investments in Africa’sinfrastructure to $13bn perannum.

Difficulties remain in confirmingChinese investments in Africa’sinfrastructure. The figure of $19.4bnfor 2017 may be an under-estimate.Chinese companies that play a keyrole in the design and construction ofinfrastructure projects in Africa do notconsistently report details offinancings for those projects.

An exaggeration of the data on Chineseinvestments is also possible, becausesome announced investments do notmaterialise, although this is a validpoint that can be made about forcommitments from all sources offinance. The largest commitmentrecorded in Infrastructure FinancingTrends in Africa, 2017may fall into this

category, as it targets the 3,050MWMambila hydroelectric power plant inTaraba state. This project has seen falsestarts before and proved problematicfor nearly half a century.

The largest Chinese investmentannounced in 2017 has been excludedfrom the data in this report because itseems unlikely to progress. Nigeria’scoastal railway may yet receive the$11.1bn of funding announced, butthere are clearly several other optionsunder consideration.

There is no doubt China intends toremain a key funder of Africa’sinfrastructure development. Markinga milestone in Africa-China relations,the China Overseas InfrastructureDevelopment and Investment Cor-poration (COIDIC) in April 2017opened its first African headquartersin Johannesburg, South Africa.

With a $500m capital base, COIDICfocuses on overseas early-stageprojects, especially those in Africa,developing projects from concept tobankability and facilitating China’s

overseas infrastructure investments.COIDIC aims to establish public-private partnerships (PPPs) and saysit will be involved in the planning,designing, financing and constructionof infrastructure projects across Africain the energy, transportation and ICTsectors. This will be in line withChina’s Belt and Road initiative,which emphasises internationalcooperation on infrastructure develop-ment.

Chinese financings in the transportsector announced in 2017 includeloans of $1.2bn for the construction inEgypt of an electrified railwaynetwork linking Cairo to 10th ofRamadan City and the newadministrative capital; $1.8bn for theAbuja mass transit railway in Nigeriaand $153m for the upgrade of HarareInternational Airport in Zimbabwe.

In the water sector, China said itwould provide $1.5bn for theconstruction of the Gerbi Dam inEthiopia to provide water to AddisAbaba and $290m for a programme in


Equatorial Guinea that includes plans

to improve the treatment of drinking

water in various parts of the country.

In the energy sector, China has said it

would provide $1.5bn for the Medupi

coal power station in South Africa;

$364m for two hydropower dams in

Gabon; $290m for a 120MW wind park

in Ethiopia’s Somali state and $70m for

the construction of the 15MW Ruzibazipower plant in Burundi.

China has also said it would provide$98m for Zimbabwe’s state-ownedtelecommunications utility, TelOne,for it to implement a broadbandexpansion project to improve ICTaccess in the country.

Ghana signed a memorandum of

understanding in 2017 with China’sSinohydro for a multi-sectorprogramme that is expected to cost inthe region of $4bn. The programmeincludes a multipurpose hydro projectat Pwalugu, a flood prevention projectin Accra as well as other priorityinfrastructure projects includinggarbage treatment plants, solar powerplants and rail projects. n

2012 2013 2014 2015 2016 2017

20,000

15,000

10,000

5,000

0

$m

1,149

1485,158

1,254

5,651

9,987361

2,577424 94

1082,095

0477411

9,844 0

9,992

1,032 0

1,005

4,632

0

300Other 476

3,390

1,841

9,046

1,051

4,075

0

Multi-sector

ICT

Energy

Water

TransportTotal:13,360 13,443

3,091

20,868

19,403

6,413

2012 2013 2014 2015 2016 2017

20,000

15,000

10,000

5,000

0

$m

2,736

0 0 0 0

40

3,107

6456,871

2,274539

9,320

1,310

317

1,450

1,025259

4,336

6,816

338

9,378

2,292

1,261

2,060800

1,447

11,474

936

2,739

2,807Southern Africaincluding RSA

East Africa

Central Africa

West Africa

North AfricaTotal:13,360 13,443

3,091

20,868

19,403

6,413

Figure 48 Chinesecommitments bysector, 2012-2017

Figure 49 Chinesecommitments byregion, 2012-2017

2013 2014 2015 2016 2017 2013 2014 2015 2016 2017

5,000

4,000

3,000

2,000

1,000

0

$m

5,000

4,000

3,000

2,000

1,000

0

$m

610621

378

1,404

1,665

1,5552080

17

237

392

1,051 1,167

2,072

1,414

1,019

1,270

0

1,825

1,267

593

1,126

00

1,639

2,022 1,921

3,349

67

680

648

35226

908

79

362863

1,201

498

467

3250

1,509

83

538

491

1,555

795

50

528

580

BY SECTOR BY REGIONPan-African

Southern Africa including RSA

East Africa

Central Africa

West Africa

North Africa

Multi-sector

ICT

Energy

Water

Transport

Total:3,295

4,412

3,460

5,528

2,985 Total:3,295

4,412

3,460

5,528

2,985


Members of the Arab Co-ordination Group have consist-ently reported data for the ICA’sreports. The data provides clearinsights about the group’sactivities each year, which isappreciated by ICA members.

The ACG committed $3bn to Africaninfrastructure projects in 2017,compared with $3.8bn in 2016 and$4.4m in 2015.

The Islamic Development Bank (IDB)committed $597m in 2017,significantly lower than its 2016figure of $1.1bn. Of the totalcommitments from all sources, 86.8%was directed towards West Africa. Theremaining 13.2% was dedicated toNorth Africa.

The highest proportion of IDB’scommitments targeted energy projects($292.3m), accounting for almost halfof its investment total (49%).Financings included $166m towardsthe construction of the Sirakoro HFOII power plant in Mali, the $104m

expansion of the Kossodo HFO DieselPower plant in Burkina Faso and$22.4m for the Kayes HFO powerplant in Mali.

OFID made total commitments of$180.9m in 2017, compared with$225.8m in 2016. In 2017, OFID’scommitments were spread moreevenly across the continent. Thegreatest proportion of commitmentswas allocated to North Africa, a regionwhich received no contributions fromOFID in 2016.

Almost half of OFID’s commitmentsmade were directed towards watersector projects ($87.25m or 48%).Support was provided for the secondphase of the rehabilitation ofirrigation and drainage pumpingstations in Egypt ($53.2m); theRwanda Sustainable Water Supplyand Sanitation Programme toimprove access and provide sanitationservices in highly-populated urbanareas ($20m); and the Greater MaseruWater Supply project in Lesotho,

which includes new waterinfrastructure in peri-urban areas($14m).

Commitments by the Saudi Fund forDevelopment (SFD) amounted to$97m in 2017, compared with $2.3bncommitted in 2016. The largestcommitment was made in West Africa,accounting for 91% or $88m of thefund’s total commitment. Theremaining 9% was dedicated to NorthAfrica. Of its commitments, the SFDdirected 79% to transport, 12% towater and 9% to energy.

The Abu Dhabi Fund for Development(ADFD) committed $449m in 2017.This amount was significantly higherthan its 2016 figure of $81m. In 2016the group directed almost half of itscommitments toward energy, whereasin 2017, the majority of itscommitments were allocated totransport ($291.1m or 64.8%) with thevast majority directed towardstransport projects in Morocco ($280mor 62% of ADFD’s total funding in

5.3 Arab Co-ordination Group

Figure 50 Arab Co-ordination Group (ACG) commitments by sector and region, 2013-2017


2017). The projects include therehabilitation and expansion of the oldfishing port in Casablanca ($80m), thedevelopment of the Tangier fishingport ($72m), the construction of acruise terminal in the Port ofCasablanca ($40m), expansion andrehabilitation of the 30km roadbetween Sidi Allal and Al Maha Forest($5m), and a ship repair project inCasablanca ($83m).

Banque Arabe pour le DéveloppementEconomique en Afrique (BADEA –Arab Bank for Economic Developmentin Africa) committed $119m in 2017.The largest commitment was made toWest Africa, accounting for 61% of thebank’s total commitments. As in 2016,BADEA directed most funding (63%)towards the transport sector withcommitments of $74.5m.

Kuwait Fund for Arab EconomicDevelopment (KFAED) committed atotal of $500m, close to its 2016commitments of $509m. In line with2016, the greatest proportion wasdirected towards North Africa, whichaccounted for 60% or $299m of thefund’s total commitment for 2017.KFAED committed $250m towardswater projects, the largest commit-

ment made by the ACG for this sector.The projects included the constructionof a seawater desalination plant forEastern Port Said City in Egypt,which received two loan commitmentsin 2017 totalling $176m.

The Arab Fund for Economic andSocial Development (AFESD) in 2017financed $1bn or 35% of ACG’scommitments to infrastructureprojects. Of AFESD’s commitments,$806m or 77% was directed towardsNorth Africa, and the remaining 23%to East Africa. The highest proportionwas committed to energy (67% or$698m). The projects includeddevelopments on Egypt’s electricitytransmission grid ($197.4m) and theconstruction of the El Bagair PowerGeneration Plant in Sudan ($171m).

AFESD’s commitment to energyaccounts for 66% of the total ACGcommitments for this sector, thelargest made by any of its members.

Overall, with the exception of waterand multi-sector projects, ACGpreferences reflected those of 2016.Transport received $1.3bn of totalcommitments in 2017, similar to lastyear’s commitment of $1.4bn. Supportfor the water sector decreased byalmost half, from $1bn in 2016 to$592.7m in 2017. Energy commit-ments declined from $1.3bn in 2016 to$1.1bn. ICT has never featuredprominently in the group’s portfoliosand as in 2016, there were no 2017commitments targeted at this sector2017. n

2013 2014 2015 2016 2017

2,400

1,800

1,200

800

400

0

$m

1,600

97119

500

449

597

1,043

71

182102

360

363

615

1,604

90135259357

444

882

1,293

81135

312342392

984

2,166

81147

226

509

2,284

1,109

1,172

Transport$230m(22.1%)

Water$115m(11.0%)Energy

$698m(66.9%)


Water$250m(50.0%)

Energy$33m(6.6%)

Transport$210m(35.2%)Energy

$292m(49.0%)

Water$95m(15.9%)

181

AFESD

IDB

KFAED

SFD

BADEAADFD

OFID

2,9853,297Total:3,460 5,5284,412

AFESD2017

KFAED2017

IDB2017

IDB Partners with Chinese Private Equity HouseA memorandum of understanding was signed in 2017 between the IslamicCorporation for the Development of the Private Sector (ICD), the private sector armof Islamic Development Bank Group, and China-Africa Development Fund(CADFund), the Beijing-based private equity firm and subsidiary of the ChinaDevelopment Bank which focuses on Africa. The envisaged cooperation reflectsICD and CADFund’s goal of developing and establishing a strategic framework thatfocuses on mobilising investment in the African Islamic Infrastructure FinancingFund. n

Figure 51 Arab Co-ordinationGroup (ACG)commitments, bymember, 2013-2017


Commitments to African infra-structure by non-ICA memberEuropean development financeinstitutions totalled $1.6bn in2017, a significant increase on2016 ($392m). In 2017, energyaccounted for more than half ofthe commitments made (56% or$894m), a significant increaserelative to the 2016 commitmentof $294.2m.

Investments in transport accountedfor 31.2% ($500.7m), a greater shareof the total than in 2016 (12.8% or$50m). Water accounted for 13% or$208.3m – there were no reportedwater sector commitments in 2016.Commitments to ICT fell from $47.3m(12%) in 2016 to $1m in 2017 (0.06%).

The European Bank for Recon-struction and Development and theNetherlands’ FMO again dominatednon-ICA European DFI 2017commitments, accounting for 83% and12%, respectively, in 2017. In 2016,EBRD contributed 61% and FMO 27%of all commitments from these DFIs.

North Africa accounted for 90.3%($1.4bn) of total commitments in 2017.EBRD’s mandate for Africa is solelyfocused on this region, to which itcommitted $1.3bn in 2017. Of this$501m was directed towards transport,$207m to water and $620m to energy.This included a commitment of$322.6m to support the EgyptianNational Railways in the acquisition ofup to 100 diesel locomotives, technicalassistance for the operator’s freightreform platform and the upgrade ofservices.

The bank’s transport commitmentsalso included an investment of $178mto support Tunisian state-owned railcompany Société Nationale desChemins de Fer Tunisiens (SNCFT)with the aim of creating additionalcapacity on the railway network,addressing overcrowding on trains andimproving service reliability. Thefinancing will contribute to the upgradeand realignment of the existing Tunis-Kasserine railway line, improvingconnections between the North Westand Centre West governorates and thecapital city Tunis.

5.4 Non ICA European Sources

EBRD was the only non-ICA Europeangroup member to invest in thetransport sector. FMO and Austria’sOesterreichische Entwicklungsbank(OeEB) also made commitments inNorth Africa, accounting for 7%($101.6m) and 1% ($20m), respectively.

Of commitments made by the non-ICAEuropean DFIs in 2017, West Africa

Netherlands$193m(12.1%)

Norway $24m (1.5%)

EBRD $1,327m(82.8%)

Finland $28m (1.8%)

Austria $20m (1.2%) Denmark $10m (0.7%)

Total:$1,604m

Figure 52 Non-ICA European commitments toinfrastructure by source, 2017


As with 2016 commitments,investments made in the energy sectorfeatured prominently in a number ofthe non-ICA member Europeanfunders’ portfolios. EBRD made thegreatest contribution, accounting for69% ($620m) of the total. Around one-third of its commitment ($200m) wasdirected towards Egyptian NaturalGas Holding Company’s (EGAS)energy efficiency programme, whichfocused on improving the Egyptiantransmission network and gas pipelinesystems; the programme includes theinstallation of waste heat recoverytechnologies, turbo-expanders atnatural gas pressure reductionstations, the establishment of aliquefied petroleum gas (LPG)separation plant, carbon dioxideremoval from wet gas systems and theprovision of metering data systemsinfrastructure at Amerya, Dahshourand the Western Desert Complex.

The remaining proportion of EBRD’senergy commitments were directed atthe Egyptian solar FiT (feed-in tariff)programme for the development of 16

solar PV projects in the Benban SolarPark (see page 67).

FMO’s commitments were directedsolely towards the energy sector,accounting for 22% ($193m) of thetotal commitment made to this sector.As with EBRD, more than half ofFMOs commitments were directedtowards the Egyptian solar FiTprogramme. FMO also supported M-KOPA Solar, which is also being co-financed by Norfund, to providepay-as-you-go off-grid solar systems inEast Africa.

Commitments to the water sectoraccounted for 13% ($208.3m) of totalinvestments made. EBRD made thegreatest contribution of any member($207m or 99.3%) having committed tosupport improvements in sanitationinfrastructure in the Fayoum area,south of Cairo, which will provide30,000 jobs for local people. Finnfundinvested $1.3m in the water sector,focusing its commitments towardspan-African Sanergy Inc, which worksto provide affordable and accessiblesanitation facilities in urban areas.n

accounted $52.7m (3%), receivingsupport from FMO and Denmark’sInvesteringsfonden for Udviklings-lande (IFU) for the development ofenergy generation projects. Thisincluded IFU’s commitment of $10.3mto support the development of theKayes 90MW HFO power plant inSenegal, a project being co-financed byIDB, Banque Ouest Africaine deDéveloppement (BOAD – West AfricanDevelopment Bank), OFID and theEAIF. FMO also directed $42.2mtowards the development of the 50MWAkuo Kita Solar PV project in Mali,$15.1m towards the development of a20MW ground-mounted solarphotovoltaic (PV) plant in the Lougaregion of Senegal and $16.7 for theexpansion of the existing Senergy IIBokhol Solar PV plant.

East Africa attracted totalcommitments of $50.6m (3%). FMO’scommitment accounted for 98% of thistotal ($49.6m), supporting thedevelopment of two run-of-the-riverhydropower projects in Uganda: the15MW Bugoye and Nyamagasanihydro power projects. Southern Africaaccounted for $15m (1%) of the totalcommitments made, which includedNorfund’s investment towards NewAfrica Power, a joint venture betweenNorfund, Vineyard and responsAbilityRenewable Energy Holdings todevelop 65MW portfolio of small scalerun-of-the-river hydro power projectsin Zambia, with the aim of submittingthese as part of Zambia’s GET FiTprogramme. Central Africa received nocommitments in 2017.

Total commitments of $34.6m (2%)were directed towards pan-Africaninitiatives, including support forresponsAbility Renewable EnergyHolding (rAREH), a company with afocus on small-scale renewable energyprojects in East Africa. FinnFund wasthe only funder to invest in the ICTsector, committing $1m to finance themobile money service M-Birr EthiopiaV project, which offers branchlessbanking networks on mobile platforms.


Energy$894m(55.7%)

ICT$1m

(0.06%)

North Africa$1,449m (90.4%)

East Africa$51m (3.2%)West Africa$53m (3.3%)

Southern Africaexcluding RSA$17m (1.0%)

Pan-African$34.6m (2.2%)

Water$208m(13.0%)

Total:$1,604m

Total:$1,604m

Figure 53Non-ICA European commitments toinfrastructure by sector, 2017

Figure 54 Non-ICA European commitments toinfrastructure by region, 2017


New Development BankThe New Development Bank, themultilateral development bankestablished by the BRICS states,reported no commitments to Africa in2017. It reported its first commitmentto Africa’s infrastructure in 2016 witha $180m loan to South Africa powerutility Eskom to build transmissionlines and a substation for the Sowetoarea to integrate renewable energyprojects from independent powerproducers. The bank said it hoped tolend as much as $600m more in SouthAfrica in 2018 in an effort to spreadfunding more evenly across its fivemember states.

In May 2018, the bank – establishedby South Africa, Brazil, Russia, Indiaand China – announced a $200m loanto state-owned transport and logisticsutility Transnet to rehabilitatecontainer terminals in Durban. InJuly, the Bloomberg news agencyreported NDB president K V Kamathsaying, “our aim is to be equitableamong our five members…if you lookat the $4bn we will be doing this year,we should be lending around $800m[to South Africa]. I hope this year, wewill hit that number.” Kamath saidtwo more loans were in the pipeline,one to a bank that will then on-lendthe funds for renewable energy

developments while the second will bemade available to critical infra-structure. NDB will also begin raisingmoney and lending in South Africanrand to help protect clients fromcurrency risk, Kamath added. In 2017,the Shanghai-based bank opened itsAfrican Regional Centre to assistproject identification in South Africa.

Africa 50Africa50, the infrastructure invest-ment platform established by AfDB, isproviding 25% equity to fundconstruction alongside Scatec Solarand Norfund of six solar projects to belocated in the Benban solar park in theEgyptian city of Aswan. Africa50 saidit would invest $8m. Norwegian solardeveloper Scatec Solar announced inOctober 2017 that it had securedfinancing of $335m from a consortiumof DFIs for the development of projectstotalling 400MW. The consortiumconsists of the European Bank forReconstruction and Development, theUnited Nations’ Green Climate Fund,Dutch development bank FMO, theIslamic Development Bank andIslamic Corporation for theDevelopment of the Private Sector. Thesix 50MW plants that Scatec willbuild, own and operate will all becompleted during 2019, At a total costof approximately $450m. Scatec’s

share of equity investments is in the$50m-$70m range. It estimatesaggregate revenues from the six plantsat $60m per annum over the 25-yearcontract period (for more details on theBenban project see page 67).

At its second annual shareholdersmeeting in Dakar in September 2017,Africa50 signed a developmentagreement with Senegalese utilitySenelec for competitive selection of astrategic sponsor to develop a 120MWcombined cycle thermal power plant atMalicounda. The process resulted inMelec PowerGen becoming theindependent power producer andselecting Lebanon’s Matelec asengineering, procurement and con-struction contractor. The plant willinitially run on heavy fuel oil, but canbe converted to natural gas when thisbecomes available from recentlydiscovered gas fields. Wärtsilä ofFinland signed a contract in March2018 to engineer, manufacture anddeliver the Flexicycle plant, which willcomprise seven Wärtsilä 50 engines. A20-year power purchase agreement isenvisaged with a competitive feed-intariff rate arrived at through a publictender. The electricity generated willbe fed into the network through anexisting distribution substation.n

5.5 Other Sources of Financing

New Multilateral Funds


South KoreaThe Export-Import Bank of Korea(Korea Eximbank) committed $10m in2017 to transport and portinfrastructure in Senegal, with $5mgoing to projects in each. The projectsaim to bring improved refrigeratedtransportation and storage facilitiesfor small- and medium-sizedSenegalese enterprises in the fisheriessector and stimulate opportunities forKorean participation in Senegal’sprospective fishing sector.

Korea Eximbank’s most notablecommitment in Africa in 2017 fallsoutside the ICA’s definition ofinfrastructure but underlines SouthKorea’s view of Africa as a seriousinvestment location. In June 2017 thebank signed a $5bn project financingcontract for offshore gas fielddevelopment in Mozambique. The gasfield development project is a jointproject of Korea Gas Corporation,ExxonMobil of the US, Italian energycompany Eni and Empresa Nacionalde Hidrocarbonetos (ENH) ofMozambique. Korea Eximbank, theKorea Trade Insurance Corporationand China Exim Bank areprovisionally financing the project.According to the contract, KoreaEximbank is responsible for one-fifthof the amount.

IndiaIndia committed just over $700m toinfrastructure projects in 2017compared with the exceptionally highamount of $1.2bn committed in 2016.

Reflecting a noticeable trend amongstfunders, Export-Import Bank of India(Exim Bank India) chose to invest ina business rather than a project whenit extended a $500m line-of-credit toSBM (Mauritius) InfrastructureCompany. The credit line will enablethe company to invest alongsidepublic sector entities in infrastructureprojects in Mauritius. The credit is

South Korea, India and Turkey

2013 2014 2015 2016 2017

1,200

0

$m

1,000

800

600

400

200

450

48

91

220

90

287

268

255

0

204

500

513

262

422Multi-sector

Energy

Water

TransportTotal:761

424

704

524

1,197

Figure 55Indiancommitments bysector, 2013-2017

Exim Bank India’s first financing forSBM, but the bank has previouslyextended four credit lines to theMauritian government aggregating$164.8m.

Exim Bank India committed $93.5mto Cameroon for the construction ofthe Nkongsamba-Bafoussam andYaounde-Abong Mbang transmissionline as well as $110m for the design,supply and assembly of transmissionlines from Nouakchott to Nouadhibouin Mauritania.

TurkeyTurkey stepped into the Africa’srailway infrastructure sector in a bigway in 2017. Turkish constructioncompany Yapi Merkezi in February2017 won a $1.22bn contract to build a205km-long rail line between Dar esSalaam and Morogoro, as part of acollaboration with Portugal-basedMota-Engil Engenharia e ConstruçãoAfrica. In October, the Turkishconstruction company secured anadditional $1.92bn contract to extendthe high-speed electric StandardGauge Railway (SGR) line a further422km from Morogoro to Makutupora,Dodoma. Construction work on bothstretches of the Central Railway Lineis now under way.

Tanzania has already allocated around$1.2bn to the Central Railway LineSGR in three successive federalbudgets up to the financial year2018/19, despite reports that theprojects would be externally funded.

China Exim Bank reportedly said in2016 that it would put $7.6bn intoTanzanian projects, but it wasanticipated that Chinese companieswould rehabilitate and build theCentral Railway Line, a commitmentthat was noted in InfrastructureFinancing Trends in Africa, 2016 butexcluded from the data as it was clearthat the parties were finding itincreasingly difficult to concludearrangements.

Tanzanian President John Magufuliterminated a contract awarded to aChinese construction company due toallegations of corruption. While ChinaExim Bank was expected to financethe Tanzanian line, it withdrew afterthe contract was terminated. This sawTanzania turn to the other BRICSnations seeking for finance, withMagufuli asking South Africa’s formerpresident Jacob Zuma for finance.

Turkish financing for the contractsundertaken by Yapi Merkezi wasdiscussed during the January 2017


visit of the Turkish president RecepTayip Erdogan to Tanzania, when hesuggested the Turkish governmentgovernment would support the deal.However, there is no evidence of directfunding of the project by Turk EximBank.

The African Development Bank inAugust 2017 indicated it would stepinto the railway financing and severalother financiers have now comeforward.

Trade and Development Bank (TDB)has also allocated funds for the CentralRailway Line according to theMauritius-based regional developmentbank’s president Admassu Tadesse. Hesaid TDB had allocated the $200m tohelp Dar es Salaam push forward withits railway and energy infrastructureprojects.

It is possible that the contracts are alsofunded by other external sources, butthese may also be reflected inTanzania’s sizeable declarations of

federal funding for its railways, whichopens up the potential for doublecounting data.

Yapi Merkezi is building a total of950km of railway in Sub-SaharanAfrica, which the construction firmsaid would be instrumental inincreasing exports for commoditiessuch as gold and coffee. The companyis also building railways, tramwaysand metro systems in the Middle Eastand North African (MENA) region.

In July 2018, IFC announced it wasproviding a $100m financing packageto Yapi Merkezi Holding, the parentcompany of Turkish constructioncompany Yapi Merkezi Insaat veSanayi (YMI), to support its expansionand boost the construction of transportinfrastructure in challenging markets.

The three-year term packagecomprises a $75m euro and US dollarequivalent loan from IFC’s ownaccount, and a $25m euro equivalentsyndicated loan from Akbank AG

under IFC’s B-loan structure. Thefinancing will provide YMI withworking capital to allow the completionof transport infrastructure projects inSub-Saharan Africa, MENA, andTurkey, and support the company’sexpansion in these markets.

The Tanzanian government has said itintends to invest around $14.2bn overthe next five years to construct a2,561km SGR network, which willconnect its Indian Ocean port of Dar esSalaam to the other regions within thecountry. To finance these ambitiousplans, Tanzania may also benefit theMarch 2017 announcement by WBGpresident Jim Yong Kim that Tanzaniawill be able to access up to $2.4bn inconcessional financing over the nextthree years, an increase of half a billiondollars over previous allocations. Theadditional resources will come fromWBG’s International DevelopmentAssociation (IDA) window. n

Other Sources of Financing


Three non-ICA member regionaldevelopment banks reportedfinancing data in 2017: BanqueOuest Africaine de Dévelop-pement, the Trade and Develop-ment Bank (formerly PTA Bank)and Ecowas Bank for Investmentand Development (EBID).

Finance committed by these bankstotalled $538m, which is significantlylower than the $924m reported in2016. West Africa received 86% offinance committed with SouthernAfrica receiving the remaining 14%.Transport projects received the mostwith $271m, energy projects received$208m, water projects $34m andmulti-sector projects received $25m.All support was provided throughloans.

Benin-based BOAD committed themajority of infrastructure finance in2017 with $453m, of which $261mwent to transport projects, $130m toenergy projects and $34m to waterprojects. Multi-sector projectsaccounted for $25m.

The bank provided $94m for fourprojects in Guinea Bissau, $54m fortwo energy projects including the

electrification of 14 localities from the225kV Organisation pour la Mise enValeur du Fleuve Gambie (OMVG)electricity interconnector thatconnects the national grids of Gambia,Guinea, Guinea Bissau and Senegal.The bank also provided $42m forthree solar projects; a 20MWinstallation in Bissau and two 1MWplants in Gabu and Canchungo. It isexpected that the projects will providepower for 500,000 people and mitigate24,100 tons of CO2 emissions.

BOAD approved a loan of $25m for amulti-sector project to rehabilitate thePort of Bissau including civil works onthe quay, construction of a mediumvoltage substation and theinstallation of new IT equipment. Anadditional loan of $15m was approvedfor a road planning and asphaltingproject for the Ntunhané-Catiò road.

In Côte d’Ivoire, BOAD approvedloans of $95m for three transport andwater projects including a safe watersupply project in Abidjan and therehabilitation of San Pedro airport’srunway.

Elsewhere, BOAD approved $42m forthe upgrade of the Lokossa-Deve-

Aplahoué-Togo border road betweenBenin and Togo. In Senegal, the bankcommitted $93m for a road rehab-ilitation project and electricitydistribution project. In Burkina Faso,a total of $85m was approved for roadmaintenance, an irrigation and damfeasibility study and the upgrading ofthe 33kV transmission grid.

Mauritius-based TDB committed atotal of $74m in 2017. The bankapproved a $55m facility co-arrangedwith the Export Import Bank of Indiafor the 29.4MW Curepipe wind farmin Mauritius. TDB’s portion of thefacility is $28.7m. The TDB alsoprovided $30m as part of a $123msyndicated loan facility with StandardBank of South Africa for ZimbabwePower Company (ZPC). The financingwill allow ZPC to secure and optimisecapacity, including the rehabilitationof the Kariba South plant.

Lomé, Togo-based EBID committed$14m towards transport and energyprojects in Benin and Côte d’Ivoire,including $8m to Sociéte Ivoirienne deManutention et de Transit tomodernise its freight handling andtransit services.n

5.6 Regional Development Banks


Water$34m(7.6%)

Energy$131m(28.8%)

Multi-sector$25m(5.6%)

Transport$10m (70.8%)

Energy$4m (29.2%)

Energy$74m (100%)

Total:$453m

Total:$14m

Total:$74m

Figure 56BOAD commitments by sector, 2017

Figure 57 EBID commitments by sector, 2017

Figure 58TDB commitments by sector, 2017


close in 2017 totalled $5.2bn. Of these,$2.3bn (44.8%) was privatelyfinanced.

This is a significant increase ininvestment compared to 2016 whentotal project investment amounted to$3.6bn, of which $2.5bn was privatecapital. The investments in 2017 werelower than the $8.5bn recorded in2015 but slightly higher than the$5.1bn reported in 2014.

The majority of projects – 41 out of 45– that reached financial close in 2017were in the energy sector. The

remaining projects include three inthe transport sector and one in thewater sector. There were no ICT ormulti-sector projects involving privatesector participation in 2017. The 45projects in 2017 is a marked increasecompared to 2016 where only 12projects reached financial close.

Private sector financing in energyprojects totalled $1.9bn, transportprojects received $360m and waterprojects $19m. The dominance ofenergy investments is largely due toseveral Egyptian solar projects,

6. Private Sector

6.1 Private Sector Engagement with the Public Sector

Private sector financing inAfrican infrastructure is criticalgiven the limited amount ofpublic and governmental supportacross the continent. However, anumber of challenges remain.Developing public-private part-nerships, particularly in largeinfrastructure projects, canattract private financing inemerging and developingmarkets.

Projects with private sectorparticipation that reached financial


Energy$1,945m (83.7%)

North Africa$1,137m(48.9%)

East Africa$6m (0.2%)

West Africa$704m(30.3%)

SouthernAfrica

excludingRSA

$321m(13.8%)

Water$19m(0.8%)

Central Africa$156m (6.7%)

Total:$2,324m

Total:$2,324m

$m

20172013 2014 2015 2016

5.2

8.8

5.1

8.5

3.6

Figure 59PPI Project Database trends, 2013-2017

Figure 60 Private sector financing by sector, 2017

Figure 61Private sector financing by region, 2017

Adams solar phase II

Italy’s Enel Green Power commissionedthe second phase of its 82.5MW Adamssolar project in February 2017. Locatedin South Africa’s Northern Capeprovince, the project was selected inthe third round of the RenewableEnergy Independent Power ProducerProcurement (REIPPP) programme in2014 and reached financial close thesame year.

The project cost $109.6m with financingprovided through a Nedbank loan andwill sell power to Eskom through a 20-year power purchase agreement (PPA)at a tariff of $0.86 per kilowatt hour.

Kuvaninga Gas

The 40MW Kuvaninga gas-fired plant inMozambique was commissioned inNovember 2017 after almost three yearsof delays. The $98m project, developedby a consortium of Enventure Partners;Intelligence, Counselling and Research,and Investec Bank, is supplied gas fromSasol’s Temane and Pande fields undera 15-year tolling agreement throughMozambique’s state-owned electricityutility, Electricidade de Moçambique.Investec Bank, China Export CreditInsurance Corporation, DevelopmentBank of Southern Africa and theIndustrial Development Corporation ofSouth Africa provided funding. n


collectively known as Benban,reaching financial close in 2017, andthe $550m Tema liquified natural gas(LNG) import terminal as part theTema port expansion in Ghana.

Investments in the energy sector aredominated by solar projects, with 32reaching financial close. Theseincluded the Benban solar parkprojects in Egypt and the 50MWAfrinergia solar PV plant in Nigeria.The largest solar investment was the$220m Noor PV I project in Morocco,which attracted $155m of privateinvestment.

Only one wind project reachedfinancial close in 2017, the 262MWRas Ghareb wind farm in Egypt,which closed in December 2017 at atotal cost of $400m, of which $208m isprivate investment. A consortiumarranged by Engie, including Orascom

Sokhna Port Bunker Located south of the Suez Canal in Egypt, the $504m SokhnaPort bunkering project reached financial close in May 2017.Financing was provided to Sonker Bunkering Company by theIFC and EBRD through loans of $150m and $94m, respectively, aswell as a commercial loan from the Commercial InternationalBank.

Sonker operates a storage and bunkering company in SokhnaPort which has grown and expanded in recent years. With theexpansion of the Suez Canal, the installation of a bulk liquidsterminal facility to import and store gasoil, LPG and LNG is vital

to ensure Egypt’s fuel and energy security. According to theSuez Canal Economic Zone, the facility will be capable ofhandling 250,000 cubic metres of LPG and gasoil.

EBRD believes the project will promote private ownership inEgypt, as Sonker is one of a few private independent entitiesoperating in the energy storage and bunkering sector. It willalso demonstrate efficient operation of hydrocarbon importand storage facilities, and set standards for corporategovernance and business conduct. The Egyptian Ministry ofInvestment and International Cooperation said in May 2017that the project will provide 2,400 direct jobs. n

Construction, Toyota and Suez, ledthe project. Société Générale andSumitomo Mitsui Banking Corp-oration provided private finance. Thewind farm is expected to be online byDecember 2019.

Two hydroelectric power plantsreached financial close, the Musanzehydro plant in Rwanda, which closedat $17m, and the Butama hydro plantin Uganda, valued at $19.3m.

The $345m 80MW South Akanyarupeat power plant in Rwanda, led byHQ Power – comprising Turkey’sHakan with Quantum Power andThemis – reached financial close inFebruary 2017. The project will beoperated under a 26-year PPA.

One of the largest privateinvestments in the transport sectorthat closed in 2017 was phase III of

the Sokhna Port Bunkering project inEgypt with a total value of $504m.Private investment amounted to$260m. The Tema LNG importterminal in Ghana and the Ivato andFascene airports in Madagascar werethe only other transport projects toreach financial close.

Only one water project reachedfinancial close, the Kigali watersupply plant in Rwanda with $19.4mprivately sourced.

North Africa received the largestamount of private investment with$1.13bn, primarily due to the Benbansolar projects. West Africa followedwith $704m, Southern Africa with$321m, Central Africa received$156m and East Africa received$5.6m, solely for the Butama hydroplant in Uganda.

Challenges for PrivateSector InvestmentPrivate investment in Africaninfrastructure is still proving achallenge to developers and investorsgiven the myriad businessconsiderations and unforeseenchanges that occur.

Speaking under the Chatham HouseRule at a recent energy investmentconference, a senior African publicsector stakeholder outlined howprivate investors and governmentagencies should be aligned.“Governments just don’t haveexperience with large, multipleproject procurement. So there is atendency to want to do one large thing

Projects Commissioned in 2017


at a time”. As large projects attracteconomic, political and social interest,governments find it difficult todevelop them in a clear manner.Therefore “private developers withclear objectives are more likely toestablish connections along the chainfor multiple projects they want toengage with, which has a bettereconomic outcome. You need to cometo the government and speak with onevoice about how you contribute to thegovernment plan, agree onstandards”.

Renewable power developer Lekelahas successfully developed a158.7MW wind project in Senegal.Lekela business development directorJulian Horn told the B2B newsletterAfrican Energy in October 2018 thatthe success of its project and otherindependent power producers (IPPs)is down to Senegal’s stability. “Theyhad a stable government, they had arelatively peaceful handover of power,they had reasonably democraticelections, and they have a presidentwho has really backed renewableenergy”.

Private Sector

Also in comments to African Energy,Fenix Zambia managing director JohnFoye attributed the success of thecompany’s solar home system projectsin Uganda and Zambia to firstly,knowledge of the markets andsecondly to the alignment of projectpartners. In Uganda, Fenixunderstood low population density inits key market would introducelogistical issues in product delivery

Ensure strong government supportGovernment support can make or break aproject. An influential politician can eitherdrive a project publicly or derail its progress.South Africa’s REIPPP programme is anexample of a government programme that isstrongly supported and subsequentlyattracted a large amount of privateinvestment. The programme has a strongtrack record and a clear framework in whichprivate investors are expected to work in.

Consider the right partnersEnlisting a diverse and strategic group ofinvestors and partners can spread theburden of responsibility and bring in

expertise, especially in difficult markets.Often the combination of public and privateinvestors with an aligned mission ensurestechnical expertise with a long-termdevelopmental approach and the capabilityto fill funding gaps.

Ensure clear milestones for projectimplementationClear and reliable project management isessential for timely project implementation.Having a structured plan including cleardeadlines along with direct access todecision makers will make implementationswifter and smoother. n

Best Practices for Private InvestorsThe following recommendations are drawn from Infrastructure Financing in Sub-Saharan Africa – Best Practices from Ten Years in the Field, which was published inMay 2017 by The Boston Consulting Group and Africa Finance Corporation.

and marketing. “Everything requiresa more entrepreneurial team, a teamthat plans a bit better”. After Engie’stakeover of Fenix, it was allowed toremain as an independent companywith its mission unchanged. “We[Fenix] want to reach millions of SSAhouseholds, so does Engie. We want todo it in a decentralised, decarbonised,digital manner, so does Engie”. n

Private investment into Africanenergy markets is becomingeasier according to Lucy Heintz,head of renewables at growthmarket private equity investor,Actis. She points to several successfulprivate energy investments across thecontinent.

South Africa’s Renewable EnergyIndependent Power Producer(REIPPP) Programme programme,which completed its fourth biddinground in April – worth an estimated$4bn – has “convincingly demonstrated,that with an appropriate framework,large-scale programme and multiplerounds of bidding, that it [the privatesector] can bring down the cost of powerover time and deliver reliable supply”.

Heintz also notes the increasingamount of installed private capacityin Senegal, Ghana, Kenya andMozambique, where IPP frameworksare well understood.

However, a number of challengesremain that national governmentswill need to address before thebenefits the private sector brings canbe fully realised. Although the cost ofrenewable power is competitive withother fuels, weak power grids and gridinvestment undermine the ability ofthe grid to absorb the intermittentnature of renewable power.

Cost reflective tariffs continue to be asticking point for national utilitiesand Heintz believes this and the high

amount of budgetary support for thepower sector constrains capacitygrowth, consequently limiting privatesector investment.

Actis has five investments in theAfrican energy sector from its twocurrent energy funds – Actis Energy 3and 4, which raised a cumulative totalof $3.9bn. Investments include, LekelaPower, Cameroon’s power utility Eneoand Azura Power in West Africa.

Actis invests in energy, private equityand real estate in growth marketsacross Africa, Asia and Latin America.The firm has invested approximately$7.8bn and realised $9.3bn from 160full and partial exits. n

Interview with Actis


Benban Solar ParkThe Benban Solar Park is one of the most complex energyprojects under development on the continent and oncecompleted will be the largest solar installation in the world. Thescheme is also an important element of Egypt’s target togenerate 20% of its electricity from renewable sources. InOctober 2017, 23 projects reached financial close in thesecond round of the feed-in-tariff programme, totalling$1.98bn, of which $513m was privately sourced. Includingprojects from the first round, 32 projects comprising 1.5GW areexpected to be fully operational between December 2018 andJune 2019.

Financing for the projects comes primarily from a syndicate ofseven lenders headed by the EBRD, which has committed to a$500m framework for renewable energy in Egypt and has sofar financed 16 solar projects. An additional nine-membergroup led by the IFC finalised a $653m debt package for 13 ofthe projects. Lenders are a mix of commercial anddevelopment financiers. While no project went ahead withoutdevelopment finance, obtaining private capital was a necessityfor all projects.

The IFC has said the complex is expected to mitigate 2 milliontonnes of greenhouse gases a year and employ 10,000 peopleduring construction and 4,000 once fully operational. n

EBRD-led financing ($m)

Project sponsorand key stats

AccessPower/Total Eren

ACWA Power-ledconsortium Alfanar Group Scatec Solar-led

consortiumEDF EnergiesNouvelles/ El-

Sewedy Electric

Capacity and PPA 100MW, 25yr PPA 120MW, 25yr PPA 50MW, 25yr PPA 300MW, 25yr PPA 100MW, 25yr PPA

Feed-in tariff $0.084/kWh $0.084/kWh $0.084/kWh $0.084/kWh $0.084/kWh

Equity 38.6 44.6 17 154.98

EBRD 58 70.3 29 114 54

Green Climate Fund 48

ICD 25.02

FMO 54

Proparco 58

ICBC 72.8

IDB 28 75

Other financing 90

Total 154.6 143.1 74 471 144

Nubian Suns: IFC-led financing ($m)

Project sponsorand key stats

Acciona Energia-led consortium

Alcazar Energy-ledconsortium

Enneray-ledconsortium

Shapoorji PallonjiInfrastructure

CapitalTaqa Arabia

Capacity and PPA 150MW, 25yr PPA 200MW, 25yr PPA 90MW, 25 yr PPA 50MW, 25yr PPA 50MW, 25yr PPA

Feed-in tariff $0.084/kWh $0.084/kWh $0.084/kWh $0.084/kWh $0.084/kWh

Equity ($m) 30 71.4 31 18 15

IFC 137 60 44 19 20

IFC syndication 84.6 48 21

AIIB 57 38 47 19 19

AfDB 19

Total 224 254 170 75 75

Selected Benban Solar Park Project Financings


Of commitments totalling $81.6bnmade in 2017, the transport sectorwas the largest beneficiary by asignificant margin. Financing oftransport infrastructure of $34bnwas equal to 41.7% of all funding.The energy sector, which recorded$24.8bn worth of financing in 2017,accounted for 30.4% of the total.Beyond this, the water sectoraccounted for $13.2bn (16.2%),followed by multi-sector investments,which registered $5.1bn (6.3%).

The remaining $2.2bn not attributedto any sector includes nationalgovernment multi-sector spendingwhich is only partly attributed to ICA-defined sectors.

TransportTransport sector financing saw aconsiderable jump in 2017, rising to$34bn compared to the $26.2bnrecorded in 2016 and above the $32bnfive-year average. There was also acontinuation of the trend seen inrecent years by which the transportsector attracted more investmentthan any other sector.

Of this total, African nationalgovernments provided the majority ofthe funding with $20.1bn ofinvestment – considerably more than

the second highest recorded figure ofthe last five years ($17.64bn recordedin 2014). ICA members wereresponsible for the second largestamount of investment into the sector,with $8.1bn (23.9%) representing asignificant increase on the $5bnreported in 2016.

Regionally, East Africa accumulatedthe largest amount of investment inthe transport sector at $8.1bn, or23.7% of all sectoral commitments.This was slightly ahead of NorthAfrica’s $7.5bn (21.9%), despite theregion witnessing a significantincrease on the previous year. WestAfrica, which recorded the highestsectoral investments in 2016, closelyfollowed with commitments of $7bn(20.5%) in 2017. Southern Africa sawa more than doubling in commitmentsfrom the previous year to $5.8bn(16.9%), up from $2.3bn recorded in2016. South Africa and Central Africaregistered $4bn and $1.6bn,respectively.

WaterTotal commitments into the water andsanitation sector increased in 2017,rising to $13.2bn from the $12.2bnrecorded the previous year. This wasmainly due to a significant increase in

Chinese financing, with investmentfrom other financiers seeing mostlysmall variations.

ICA member financing to the sectorrecorded a slight decrease of 1.2%compared to 2016, slipping from$4.7bn to $4.6bn. Egypt was thelargest beneficiary of ICA memberfinancing to the water sector with$584m of commitments. Ethiopia($471m) was the second most populardestination, followed by Tunisia($419m). African national governmentspending on water and sanitationprojects also fell slightly, which at$5.9bn was slightly lower than the$6.1bn recorded in 2016, but stillaccounted for 44.6% of total financingof the sector in 2017.

East Africa accounted for the largestshare of investment regionally, whichat $4.1bn accounted for 30.7% of allsectoral spending, and displacingNorth Africa, which was the mostpopular destination for the financing ofwater projects in both 2015 and 2016.RSA benefitted from $2.3bn (17.6%) incommitments while Southern Africareceived $1.6bn (12.2%).

EnergyCommitments to Africa’s energysector saw a considerable increase in

7. Sectoral Analysis

7.1 Overview


2017, rising from $20.6bn in 2016 to$24.7bn in 2017. Increases reported infinancing from China, Africannational governments and privateinvestors offset varying levels ofdecline in commitments made byother sources.

The most dramatic rise in the financingof energy projects came from China,whose total commitments in 2017 of$9.1bn represented almost double the$4.6bn invested the previous year.Despite ICA member commitmentsfalling slightly compared with theprevious year, the $5.8bn ofinvestments accounted for 23.3% of allsectoral financing, making ICAmembers the second largest financier ofenergy projects in 2017. WBG andAfDB were the most substantialinvestors among ICA members,accounting for $2.7bn and $1.4bn,respectively. African nationalgovernment contributions rose to$5.6bn from $4.4bn in 2016, withAngola and South Africa investing themost in energy projects.

West Africa was the most populardestination of financial commitments

in 2017, accounting for 34.2% of thetotal. Second was North Africa, whichreceived 19.8% of all sectoralspending. With commitments totalling$5.2bn, Nigeria was the largestbeneficiary of energy spending in 2017by a substantial margin. Egypt camesecond having received $3.5bn.

ICT The financing of ICT projects rosesubstantially in 2017, which at $2.3bnwas the highest figure recorded overlast five years. This amount wassignificantly more than the $1.7bnfigure recorded in 2016 andrepresents a 37% increase. Theincrease is primarily due to anincreased level of commitments fromICA members and China.

ICA member commitments rose to$618m in 2017, the highest figurerecorded over the previous five years.Of this, WBG accounted for a massive75.1% of total ICA member financingin the ICT sector. Chinese financingalso skyrocketed, which having risento $1.1bn was almost treble the$300m recorded in 2016. Conversely,

African national government spen-ding to the sector decreased in 2017 to$600m.

The most popular destinations for ICTfinancing was West Africa (41%),followed by Southern Africa (23.4%)and North Africa (12.3%).

Multi-sectorMulti-sector commitments rose to$5.1bn in 2017, a significant increaseon the $2.8bn recorded the previousyear. This was due almost entirely tothe $4.1bn of commitments made byChina, which did not register a singlemulti-sector commitment in theprevious three years. ICA membercommitments fell from $863m in 2016to $528m in 2018. Commitments fromother financiers changed marginallyin comparison.

At $4bn, West Africa received the mostmulti-sector financing. SouthernAfrica ($566m) was the second mostpopular destination followed by NorthAfrica ($224m). n

Transport Water Energy ICT Multi-sector Unallocated

35,000

20,000

15,000

10,000

5,000

0

$m

25,000

30,000

198,125

6171,051

0600

2,050

20,117

4,607

5,876

835

5,773

2,432

1,945

5,581

3,390

9,046

1

5284,075

03

525

00

02,169

0

360

1,841


Private sector


China

ICA members

Total:34,041

13,179

24,777

2,269

5,132

2,169 Figure 62 Total financing bysector andsource, 2017

In 2017, commitments to thetransport sector totalled $34bn,accounting for 42% of allinfrastructure financing. Thiswas a substantial increase on the$26.2bn reported in the previousyear, helped in part by a 63% risein commitments made by ICAmembers.

In 2017, ICA members made $8.1bn offinancial commitments accounting for24% of the total committed to thetransport sector. This was a $3.1bnincrease from the $5bn pledged in2016. Of 2017 commitments, Tanzaniawas the largest beneficiary of ICAmember financing, accounting for$810m. The second most populardestination was Madagascar ($728m)followed by Côte d’Ivoire ($650m).

The financing of transport infra-structure by African states also madenotable gains in 2017. Thecommitments rose to $20.1bn, thehighest amount recorded in theprevious five years. The contributionsmade by African states accounted for59% of total infrastructure financingin the transport sector.

In addition, Chinese commitmentsincreased from $1bn in 2016 to $3.9bnin 2017. This represents an increase of390%. Chinese funding accounted for

10% of overall transport financing in2017. However, this funding isconsiderably below its five-yearaverage of $5.3bn. In 2013, Chinesefunding for transport peaked at$10bn.

Funding by the ACG declined slightly,from $1.4bn in 2016 to $1.3bn in 2017.Major commitments by the ACG tothe African transport sector in 2017include $210m from the IDB toGuinea for the construction of tworegional integration roads projects:the Dabola-Kouroussa road, andthe Guekedou-Kissoudougou-Kond-embradou road.

Regionally, East Africa saw both thelargest total contribution of transportsector financing and the biggestincrease from the previous year. In2017, commitments rose to $8.1bn (24%of total transport commitments) from$5.3bn in 2016. The majority offinancing for infrastructure projects inEast Africa was directed towardsKenya, Tanzania and Ethiopia, whencounting both state funding andexternal financing.

Transport financing for SouthernAfrica rose by a substantial 148%from $2.3bn in 2016 to $5.8bn in 2017.The region accounted for 17% of thetotal investment into the sector.

Commitments to the transport sector inWest Africa increased by 5% from$6.6bn in 2016 to $7bn in 2017. Thisregion accounted for 21% of transportsector financing in the past year. Only5% of transport commitments went toCentral Africa. In 2017, commitmentsto the region fell to $1.6bn from $3.7bnthe year before.

With a total investment of $2.2bn, theWBG was the largest ICA membercontributor to the transport sector in2017. Japan provided the secondlargest investment, amounting to atotal of $1.9bn, followed by AfDB. n


7.2 Transport

NorthAfrica

$4,429m(16.9%)

East Africa$5,313m(20.2%)

RSA$3,510m(13.4%)

West Africa$6,648m(25.3%)

CentralAfrica

$3,651m(13.9%)

Southern Africaexcluding RSA$2,321m (8.9%)

Other$373m(1.4%)

2016total:

$26,245m

Figure 64Total transport sector financing byregion, 2016


2013 2014 2015 2016 2017

2013 2014 2015 2016 2017

0

18,000

$m

14,000

12,000

10,000

8,000

6,000

4,000

2,000

16,000

20,000

North Africa$7,458m(21.9%)


RSA$3,995m

(11.7%)


CentralAfrica

$1,622m(4.8%)


$5,768m (16.9%)

Other$133m(0.4%)

Loans$5,138m (94.7%)

Grants$287m(5.3%)

Roads$923m(43.4%)

Aviation$119m(5.6%)

Maritime/ports$535m(25.9%)

Railways$550m (25.9%)

5,299

3,602

6,771

4,982

15,036

17,640

12,949

16,349

9,987

2,095

9,844

1,005

4,567

114

1,287

2,369

1,912

2,679 2,622

8,125

20,117

3,390

360

2,050

0

23.9%

59.1%

10.0%

6.0%

1.1%

19.0%

62.3%

3.8%10.0%

4.9%

20.9%

40.0%

30.4%

8.3%

0.4%

10.5%

51.5%

6.1%5.6%

14.2%

40.4%26.8%

6.4%12.3%


ICA members

China

Private sector


* 2014 total includes $8,991msubnational financing

2017total:

$34,041m

Excludes ICA,African national governments

and private sectorExcludes ICA and African

national governments

Total:37,259 34,240* 32,357 26,245 34,041

Figure 65Total transport sector financing byregion, 2017

Figure 66 Transport sector financing by type offunding, 2017

Figure 67 Transport financing by sub-sector, 2017

Figure 63Total transport sector financing by source, 2013-2017


Commitments to the water andsanitation sector increased from$12.2bn in 2016 to $13.2bn in 2017.The main source of the increasewas the return of Chinesefinancing. Commitments fromother financiers experiencedmarginal fluctuations.

The $1.8bn of Chinese commitmentsrepresented a notable change as in2015 and 2016, there was no Chinesefunding in the sector at all. ICAmember commitments slightlydecreased (by 1.2%) from $4.7bn in2016 to $4.6bn in 2017. Nevertheless,these commitments remain higherthan the $3.2bn recorded in 2015. ICAmembers accounted for about 35% oftotal financing to the water sector,thus making these commitmentshigher than all other sources offinance except African state funding.

State funding shows a similar trend. Itfell slightly from $6.1bn in 2016 to$5.9bn in 2017. This, however, washigher than the $3.6bn recorded in2015. State financing accounted for 45%of total financing for the water sector. Ofthese, South Africa was the strongestinvestor. Its $2.3bn commitmentaccounted for 39% of state funding inthe sector. The second highestinvestment was made in Egypt, whichregistered $800m. This was followed byKenya ($483m) and Angola ($478m).

In 2016, ACG committed $1bn andthis declined to $593m in 2017.Regional development bank (RDB)commitments, however, increasedfrom $9.4m in 2016 to $34m in 2017.The private sector financing in 2017amounted to $19.4m up from zero theyear before.

China’s $1.8bn contribution includedloans to three projects in Ethiopia,Equatorial Guinea and Cameroon.The $1.5bn loan for Ethiopia’s Gerbidam which is designed to providewater for Addis Ababa is the largest ofthe three projects. Partly due to this,East Africa accounted for the largestshare of investment across Africa,which at $4bn is equal to 31% of allcommitments to the water sector onthe continent in 2017. In this regard,East Africa displaced North Africa,which was the most popular financingdestination in both 2015 and 2016.Investments in South Africa ($2.3bn)accounted for 18% of financing ofAfrica’s water sector, while SouthernAfrica ($1.6bn) accounted for 12%.

Egypt, which received $584m in 2017was the largest recipient of ICAmember financing. Ethiopia was thesecond most popular recipient of ICAcommitments with financing totalling$471m. This was followed by Tunisia,which received $419m in 2017. Notablecommitments include the AfDB’s

$156m support for the SustainableWater Supply and SanitationProgramme in Rwanda. Thisprogramme focuses on water supplyinfrastructure and improvement ofservices, sanitation infrastructure, andinstitutional support.

Important water and sanitationprojects that were completed in 2017with ICA member financing includethe Moroccan sewage systemdevelopment project. This projectbenefited from a commitment of$44.8m from JICA and its objective isto improve sewage treatment facilitiesin regional cities in the country. n

7.3 Water and Sanitation

East Africa$2,462m (20.1%)

RSA$2,166m(17.7%)

CentralAfrica$901m(7.4%)


Other$37m(0.3%)

NorthAfrica

$2,650m(21.7%)


2016total:

$12,220m

Figure 69Total water sector financing by region,2016


2013 2014 2015 2016 2017

2013 2014 2015 2016 2017

0

$m

4,000

3,000

1,000

2,000

5,000

6,000

35.0%

44.6%

14.0%

6.3%

0.1%

38.2%

49.7%

12.1%

42.2%

47.0%

9.2%

1.5%

36.0%

54.2%

1.2%7.5%

44.9%

46.3%

3.2%5.6%

NorthAfrica

$2,623m(19.9%)

East Africa$4,047m (30.7%)

RSA$2,312m(17.6%)

West Africa$1,540m

(11.7%)

CentralAfrica

$863m (6.6%)


$1,609m (12.2%)

Other$184m(1.4%)

Loans$2,664m (99.6%)

Grants$12m(0.5%)

Irrigationand drainage$86m (10.5%)

Waste treatmentand management

$1m (0.2%)

Sanitation$220m (26.9%)

Waterdistribution$80m (9.7%)

Potablewater supply

$334m(40.7%)

Other$99m(12.0%)

698 694835

631

3,377

3,184

4,6075,023

5,1805,078

3,546

5,876

361108114 114

1,480

4,663

6,077

0 00

1,841

19

1.2%


ICA members

China

Private sector


2017total:

$13,179m


and private sectorExcludes ICA and African

national governments

Total:11,195 9,375 7,538 12,220 13,179

Figure 68Total water sector financing by source, 2013-2017

Figure 70Total water sector financing by region,2017

Figure 71 Water sector financing by type offunding, 2017

Figure 72 Water financing by sub-sector, 2017


Total commitments to the energysector in 2017 reached $24.7bn, asignificant increase from 2016when they totalled $20.6bn.Increased financing from China,African state funding and privateinvestors offset a reduction infinancing from ICA members, theACG and the RDBs.

The biggest increase in the financingof Africa’s energy projects in 2017came from China. Its commitmentsrose by 95% from $4.6bn in 2016 to$9.1bn in 2017. Chinese commitmentsin 2017 were substantially more thanthe five-year average of $5.3bn. Itsfinancing to the energy sector in 2017comprised of loans (97%) and equityinvestments (3%).

ICA member commitments of $5.7bnin 2017 were lower than thecommitments in 2016 and below thefive-year average. However, ICAfinancing remained the second largestinvestment, accounting for 23% of thetotal investment in the energy sectorin 2017. Among the ICA members, theWBG contributed the highest amount,at $2.7bn. The AfDB was the secondhighest contributor with commit-ments of $1.4bn. In 2017, Egyptreceived $1.1bn of ICA member

commitments. Morocco ($445m) wasthe second most popular destinationfor ICA member commitments,followed by Côte d’Ivoire ($406m).

State funding also increased from$4.4bn in 2016 to $5.6bn in 2017. Thisaccounted for 23% of the totalfinancing of the sector. At $1.7bn,Angola invested the most in theenergy sector by a significant margin,equal to 31% of all state fundedenergy projects. South Africa ($607m)was the second largest spender onenergy projects in 2017 followed byTanzania ($504m).

ACG financing for the sector stood at$1.1bn in 2017, somewhat less thanthe $1.3bn recorded in 2016. It is alsoclear that the financing for 2017 wasbelow the five-year average of $1.4bn.

Regional development bankscommitted $209m, of which $135mwas destined for West Africa,including a $42m BOAD loan for gridstrengthening and redevelopment inthe Dakar, Thiès, Kaolack, Fatick,Saint-Louis and Tambacounda areasof Senegal.

When considering financing from allsources in 2017, West Africa was the

most popular destination, withcommitments of $8.5bn representing34% of the total. This is significantlyhigher than the commitments for allother regions. For example, NorthAfrica received $4.9bn or 19.7% of thetotal, Southern Africa received $3.8bn(15%), East Africa $3bn (12%), SouthAfrica $2.2bn (9%), and Central Africa$2.1bn (8%). Nigeria was the largestrecipient of energy sector commit-ments in 2017, having receivedfinancing totalling $5.2bn. Egyptreceived $3.5bn. n

7.4 Energy

NorthAfrica

$3,290m(16.0%)


RSA$2,272m(11.0%)


CentralAfrica

$1,819m(8.8%)


Other$934m(4.5%)

2016total:

$20,619m

Figure 74Total energy sector financing by region,2016


2013 2014 2015 2016 2017

2013 2014 2015 2016 2017

0

$m

12,000

10,000

8,000

6,000

4,000

2,000

14,000

23.3%

22.5%36.5%

9.8%

7.9%

37.3%

21.4%

22.5%

12.6%

6.2%

25.8%

14.4%

29.8%

8.5%

21.5%

38.2%

31.1%

2.0%

18.4%45.6%

24.0%

9.0%

6.8%

14.6%

NorthAfrica

$4,893m(19.7%)

East Africa$3,001m

(12.1%)

RSA$2,178m(8.8%)

West Africa$8,468m(34.2%)Central

Africa$2,070m

(8.4%)


$3,763m (15.2%)

Other$405m(1.7%)

Loans$11,241m (98.0%)

Grants$11m (0.1%)

Blended funds$12m (0.1%)

Export credit$110m (1.0%)

Lines of credit$94m (0.8%) Generation:

fossil fuels$846m(21.4%)

Other$90m(2.3%)

Generation: renewables$1,907m (48.2%)

Transmission$562m(14.2%)

Distribution$550m(13.9%)

9,180

8,635

13,044

7,699

6,861

7,486

4,817

4,420

2,577

477

9,992

4,632

4,179

2,485

7,215

1,268

1,940

4,428

2,600

5,773

5,581

9,046

1,945

2,432

2,864

10.3%

African national governmentsICA members

China

Private sectorOther bilaterals/multilaterals

2017total:

$24,777m


and private sector

Excludes ICA and Africannational governments

Total:28,601 24,056 33,522 20,619 24,777

Figure 73Total energy sector financing by source, 2013-2017

Figure 75Total energy sector financing by region,2017

Figure 76 Energy sector financing by type offunding, 2017

Figure 77 Energy financing by sub-sector, 2017

Commitments to ICT infra-structure increased by 36.9% from$1.7bn in 2016 to $2.3bn in 2017.This has brought investments inthe sector back to the highsrecorded in 2014-2015. Both ICAmembers and China made majorcontributions accounting for 27%and 46% of the overall financing,respectively.

Chinese commitments increasedmarkedly in 2017 to $1.05bn from the$300m recorded in 2016. This signifiesthe largest amount invested by Chinaover the last five years, eclipsing theprevious high of $1.03bn seen in 2015.It is also significantly above the five-year average of $643m.

ICA member contributions alsorecorded a substantial increase, risingfrom $417m in 2016 to $618m in 2016.This is the highest recorded over thepast five years. Tunisia was thelargest beneficiary of ICA memberinvestment in the ICT sector withcommitments totalling $82m, followedby Malawi ($72m) and Ghana ($50m).

State funding accounted for 26% ofthe total investment into the ICT

sector in 2017. However, total statespending of $600m in 2017 was lowerthan the $894m recorded in 2016.Non-ICA member European financialinstitutions contributed $1m, equal toless than 1% of the total. Similarly, in2016 no financial commitments weremade to the ICT sector by the ACG,India, South Korea, the RDBs orprivate sector investors.

Regionally, West Africa was the mostpopular destination for ICTinfrastructure financing in 2017,displacing Southern Africa which hadreceived the most investment theprevious year. West Africa accounted for41% of the total, with commitmentstotalling $933m. This represents asignificant increase from the $149mreported in 2016. Southern Africareceived $531m in 2017, down from the$715m committed the previous year.Nevertheless, it accounted for 23% oftotal funding of the sector. NorthAfrica’s $278m-worth of commitmentsaccounted for 12%. Commitments toSouth Africa, East Africa, CentralAfrica, and multi-regional projects eachaccounted for less than 10% of the total.

Of ICA member commitments, theWBG provided the highest amount ofICT sector financing ($464m), whichis equal to 75% of all memberfinancing into the sector. This includescommitments of $72m in Malawi,$50m in Ghana and $34m in Niger.

The AfDB was the second largest ICAmember financier of Africa’s ICTsector in 2017, with total commit-ments of $101m. Tunisia received themajority of these commitments. n


7.5 ICT

NorthAfrica$212m(12.8%)

EastAfrica$102m(6.2%)

RSA$149m(9.0%)




Other$13m

(0.8%)

2016total:

$1,658m

Figure 79ICT energy sector financing by region,2016


2013 2014 2015 2016 2017

2013 2014 2015 2016 2017

0

$m

600

1,000

800

400

200

1,200

27.2%

26.4%

46.3%

0.04%

25.1%

53.9%

18.1%

2.9%

25.8%

23.9%

43.3%

6.9%

21.2%

46.3%

17.2%

2.8%20.8%

42.3%

22.3%

13.7%

0.9%

NorthAfrica$278m(12.2%)

East Africa$215m(9.5%)

RSA$79m(3.5%)




Other$89m(3.9%)

Loans$502m(47.7%)

Equityinvestment

$550m(52.3%)

Mobile/wireless networks$1m (100%)

417

396

506

616

806

1,105

570

894

18

300

424

410

1,032

300261

67

165

47

0 0

618

1,051

600

10

12.6%

African national governmentsICA members

China

Private sector


2017total:

$2,269m


and private sector

Excludes ICA and Africannational governments

Total:1,906 2,388 2,384 1,658 2,269

Figure 78Total ICT sector financing by source, 2013-2017

Figure 80Total ICT sector financing by region,2017

Figure 81ICT sector financing by type of funding,2017

Figure 82 ICT financing by sub-sector, 2017


In 2017, investment continued its2016 trend with West Africa againreceiving the largest totalinvestments, worth $22bn. Invest-ments in North Africa, East Africa,Southern African and the Republicof South Africa all increased in2017 compared to 2016. Contri-butions to Pan-African and CentralAfrican projects declined slightly.

8.1 North AfricaIn 2017, total investment for infra-structure projects in North Africaamounted to $15.9bn. The contributionsof African state funding, ICA membersand bilateral or multilateral agencieswere $6.5bn, $3.7bn, and $3.1bn,respectively. Overall, investment to theregion reached its highest level since2014.

The transport sector received the mosttotal commitments from all sources in2017 ($7.5bn) followed by energy($4.9bn), water ($2.6bn), ICT ($277m)and multi-sector projects ($224m).Egypt received $9.7bn of totalcommitments followed by Morocco($2.5bn) and Tunisia ($2.3bn).

African state funders continued thedrive for infrastructure development bycommitting $6.5bn for projects,primarily in the transport sector($4.2bn) followed by water ($969m),energy ($777m) and ICT ($173m).External project financing reported bynational governments was dominatedby investments in Egypt’s energy sector($3.5bn). The Egyptian governmentinvested $3.7bn in its domesticinfrastructure followed by thegovernments of Morocco ($1.1bn),Algeria ($817m), Tunisia ($737m) andMauritania ($103m).

Disbursements from ICA members in2017 totalled $3bn with energy projectsreceiving the most funds ($1.5bn). Thefocus of commitments was in the energysector ($1.6bn) followed by water ($1bn)and transport ($732m) projects. Thecommitments by EU-AITF amounted to$1bn, the largest amount from ICA

8.0 Regions


2013 2014 2015 2016 2017

8,000

0

4,000

2,000

$m

0

8,000

4,000

2,000

$m

6,000

6,000

4,205

1,048

969

605

1,448

777

1,584

1050000

207 1730

877

2,365

6,522

1,639

3,481

5,078

2,137

1,219

317

3,654

3,114

1,447

2601,061

1,200

73218540000

0000399

0

5,560

4,456

2,611

1,229

0

5,584

3,681

3,568

100

4,092

0

1,137


ICA members


Private sector


China

ICA members

Private sector

* 2014 total includes $8,972msubnational financing


China

Total:7,458

2,623

4,893

278 225 399

Total:7,484 23,283* 12,389 12,933 15,875

members in 2017, followed by the WorldBank ($872m) and AfDB ($684m). TheAfDB provided $82m for Tunisia’sDigital 2020 strategic plan that aims toimprove the quality of ICT services and e-governance.

Chinese investment in North Africa in2017 totalled $1.4bn, the highest since2014. Major contributions include$207m provided by the Industrial andCommercial Bank of China for the752MW Benban Nubian Suns solarfinancing programme. The 13 solarplants in the IFC-led programmereached financial close in December2017 and are expected to begincommercial operations the first quarterof 2019.

Private investment resurged in 2017 to$1.1bn from $100m recorded in 2016.Private sector investment in the energy

sector totalled $877m and transportprojects received $260m.

Egypt was the main recipient ofinvestment with $982m for energy andtransport projects. Private investmentprovided 36% of the total financingrequired for public-private projects.

ACG and non-ICA European govern-ment contributions were $1.6bn and$1.4bn, respectively. ACG investmentsfocused on transport ($560m) andenergy ($597m) projects, while loans($1.3bn) were the preferred type offinance.

AFESD provided a $197m grant for aroad expansion project in Morocco whileEBRD provided a $200m loan for theEGAS energy efficiency project in Egyptand $374m for 16 solar power projectsat the Benban solar park. n

Figure 84Trends in North Africa financing by source, 2013-2017

Figure 83 Total financing to North Africa by sector and source, 2017


Infrastructure investments in2017 for West African projectstotalled $22bn, a significantincrease on 2016. This is largelyattributed to Chinese investmentsshowing a marked increase withfinancing of $11.5bn, followed byICA members ($4.9bn) and Africannational governments ($3.6bn).Investments in 2017 were at theirhighest level since 2013 withenergy projects receiving themost financing ($8.5bn).

Investments in transport projectsamounted to $5.2bn. Multi-sector andwater projects received $4bn and$1.5bn, respectively. ICT projectsreceived $933m. Nigeria ($7bn) andGhana ($5.1bn) received the mostfunding across West Africa. The focusin Nigeria was on energy projects($5.2bn) while in Ghana it was multi-sector projects ($4bn).

China’s investment in West Africanprojects was dominated by two projectsin Nigeria and Ghana representing atotal investment of $11.5bn. The ExportImport Bank of China provided a$4.9bn loan for the 3GW Mambillahydro plant in Nigeria while a $4bnloan was provided for a multi-sectorproject in Ghana. The project includesthe construction of a multipurposehydro project in Pwalugu, atransportation project in Lake Volta,flood protection in Accra, wastetreatment, solar power plants and a railproject. The Export Import Bank ofChina and state-owned aerospacecompany China Great Wall IndustryCorporation agreed to purchase twosatellites (worth $550m) on behalf ofthe Nigerian government through anequity investment in a Nigeriancompany. The equipment will be usedby Nigerian Communications Satellite.

ICA members continued their supportfor West Africa in 2017 by committing$4.9bn. The majority of commitmentstargeted the transport sector ($2.2bn)followed by energy ($1.6bn), water($804m), ICT ($183m) and multi-sector ($24m) projects. Côte d’Ivoire

($1.2bn) and Senegal ($1bn) receivedthe majority of investments from ICAmembers. The World Bank and AfDBcommitted $1.9bn and $1bn,respectively, to West African projects.Notable financings include a $204mAfDB loan for the Dakar–BlaiseDiagne International Airport railwayproject. Additionally, AfDB committeda $155m grant as part of a blendedfinance agreement for the Nigeria–Niger–Burkina Faso–Benin powerinterconnection project.

Identified state funding decreasedsignificantly in 2017 to $3.6bn from$4.9bn in 2016. However, there wasstill significant investment in Nigeria($1.1bn). The focus of national budgetsremained on transport projects($2.2bn), followed by energy ($659m),

water ($641m), ICT ($112m) andmulti-sector projects ($3m).

ACG financing in 2017 totalled$795m, with the focus of investmenton transport ($386m) and energy($347m) projects. IDB provided a$210m loan to Guinea for constructionof two regional roads, Dabola–Kouroussa and Guekedou–Kissou-dougou–Kondembradou.

Commitments by regional develop-ment banks decreased to $467mcompared to $601m in 2016, with themajority of funding ($273m) allocatedto transport projects.

Private sector investments recorded$704m, compared to $1.5bn in 2016.Ghana’s Tema LNG Terminalaccounted for $550m. n


2013 2014 2015 2016 2017

9,000

0

6,000

3,000

$m

0

12,000

6,000

3,000

$m

9,000

2,172

2,228

804

641

535

659

1,649

18363800

0

112

0

704

8,516

3,4334,014

4,886

6691,915

4,921

3,7324,082

2,295

11,474

5,405

1,280

2,274

1,450

4,336

1,325

1,7791,6861,841

3,620

704850

0

96244,0002503

000033

4,570

4,904

2,292

3,072

1,522


ICA members

China

Private sectorOther bilaterals/multilaterals


Private sector


China

ICA members

Total:6,984

1,540

8,458

933

4,052

33

Total:21,706 11,655 13,611 16,361 22,010

8.2 West Africa

Figure 86Trends in West Africa financing by source, 2013-2017

Figure 85 Total financing to West Africa by sector and source, 2017


8.3 Central Africa


2

3,000

2,000

1,000

0

$m

1,017

575360

123341

137

853

58350052

426

560

90000

94

0

02019

00001,307

30


Private sector


China

ICA members

Total:1,622

863

2,070

145 9

1,307

T

2013 2014 2015 2016 2017

5,000

3,000

2,000

1,000

0

4,000

$m

1,308

2,444

2,926

3,692

1,699

4,274

1,949 2,926

539

40338

936

0.4320 156

83

285

765

144

0

3,573

2,222

1,261

255

564

0


ICA members

China

Other bilaterals/multilateralsPrivate sector

A

Total:4,765 8,291 4,679 7,875 6,017

Investments from all sources forCentral Africa’s infrastructuretotalled $6bn in 2017 with leadingcontributions from African nat-ional governments ($2.9bn), ICAmembers ($1.9bn) and China($936m).

Investment from all sources declinedin 2017 compared with 2016 ($7.9bn).

Energy projects were the focus inCentral Africa with $2.1bn-worth ofinvestments, transport followed with$1.6bn while $1.3bn went towardsunallocated projects, $863m for water,$145m for ICT and $9.5m for multi-sector projects.

Cameroon received the majority offinancing with investments totalling$2bn, followed by Rwanda ($1.1bn)and Gabon ($761m).

Funding from African nationalgovernments, although down on 2016,made significant contributionstowards infrastructure. Of Cameroon’s$2bn total received commitments,$1.2bn was provided via the nationalbudget. The focus of governments wason transport ($1bn), followed byenergy ($427m) and water ($123m)projects.

Commitments by ICA membersdeclined in 2017 to $1.9bn from the$2.2bn recorded in 2016.

Energy projects received the mostcommitments ($853m) with transportand water projects receiving $545mand $360m, respectively.

In the energy sector, AfDB committed$298m for the Cameroon and Chadinterconnection project as part of aPIDA blended finance arrangement.

In Rwanda, the AfDB financed a$116m sustainable water supply andsanitation project.

Chinese investment in 2017 acrossCentral Africa was focused on energyprojects ($560m) followed by water($341m) and ICT ($35m).

Significant contributions included a$364m loan from the Export ImportBank of China for two hydropowerdams in Gabon, the 88MW Imperaticeand 36MW FE2. China’s GezhoubaGroup will build both dams.

In Equatorial Guinea, a $290m loanwill be used for a water treatmentproject and the second phase of anelectrification project in Bata.

Private investment dropped signif-icantly in 2017 to $156m comparedto $255m in 2016, the lowestcontribution to Central Africa since2014.

All of the recorded privately financedprojects were in Rwanda andcomprised two energy projects worth$362m, of which $137m was privately

financed, and one water supply project

in Kigali, which received $19m of

private finance out of the total $60m

project cost.

Contributions from the India, South

Korea and the Arab Coordination

Group totalled $94m and $50m,

respectively.

In the energy sector, India opened a

$94m line of credit with Cameroon for

the construction of the 225kV

Nkongsamba–Bafoussam and Yaounde

–Abong Mbang transmission line.

OFID provided a $20m loan for a

sustainable water project in Rwanda

and a $15m loan for the Bururi to

Gakuba road project in Burundi. n

Figure 88Trends in Central Africa financing by source, 2013-2017

Figure 87Total financing to Central Africa by sector and source, 2017


8.4 East Africa


2013 2014 2015 2016 2017

10,000

6,000

4,000

2,000

0

8,000

$m

8,000

4,000

2,000

0

$m

6,000

5,890

1,7801,491

990

720 760101381,117

260000

6,935

4,092

1,994

4,702

650

936

0000426

6,096

7,264

6,369

8,3829,320

1,025

6,816

2,739

227580

45 6

1,154

537

814 578

291 01,500

221 6122

4,433

5,571

2,060

20

1,053


ICA members

China



Private sector


China

ICA members

Total:8,082

4,047

3,001

215 26426

Total:23,732 11,400 18,745 13,136 15,796

Infrastructure investments inEast Africa totalled $15.8bn in2017 with leading contributionsfrom identified state funding($8.4bn), ICA members ($4.1bn)and China ($2.7bn).

Commitments were at the highestsince 2015 with the majority offinancing ($9.9bn) being provided fortransport projects. This was followedby water ($4bn), energy ($3bn),unallocated projects ($426m), ICT($215m) and multi-sector projects($26m). Ethiopia received the mostinvestment ($5.8bn) across EastAfrica, followed by Tanzania ($4.7bn)and Kenya ($3.3bn).

In 2017, financing from China andAfrican national budgets increased.The Tanzanian government allocated$3.4bn towards domestic infra-structure, primarily towards thetransport sector ($2.5bn). This trendwas seen across the region wheretransport projects received a total of$5.9bn, which represented a 51%increase compared to 2016 ($3.9bn).

China increased its investments in2017 to $2.7bn compared with $2.1bnin 2016 with contributions primarilymade in the water sector ($1.5bn),followed by energy ($1.1bn) andtransport ($122m) projects. Thecommitments included a $1.5bn loanfrom the Export Import Bank of Chinafor the construction of the Gerbi dam inEthiopia to provide water for AddisAbaba. In the energy sector, a $500mconcessional loan was provided to theEthiopian Electric Utility torehabilitate distribution lines in 54towns and construct 17 distributioncentres.

ICA member support in 2017 includedtotal contributions of $4.1bn and afocus on transport ($1.8bn) and water($1.5bn) projects, followed by energy($705m), ICT ($76m) and multi-sector($26m) projects. Tanzania ($1.2bn)and Kenya ($1.2bn) received themajority of commitments from ICAmembers, followed by Ethiopia($749m) and Uganda ($324m).

The World Bank provided the majorityof finance with $2.2bn incommitments with a focus on waterprojects ($1.5bn). The AfDB provideda $105m loan for debt restructuringfor the Bujagali hydro plant inUganda and a $157m loan for theexpansion of Jomo KenyattaInternational Airport in Kenya.

ACG members continued a steadytrend of investment with a total of$528m. This was directed towardstransport ($291m), energy ($171m)and water ($66m) projects. TheKuwait Fund for Arab EconomicDevelopment provided most financingwith $183m for two transport projects:the Tadjoura–Balho road in Djiboutiand the Nyahua–Chaya road inTanzania. In the energy sector, theArab Fund for Economic and Social

Development provided a $66m loan toconstruct the El Bagair oil powerstation in Sudan and $90m loan torehabilitate the drinking waterdistribution network in Djibouti.

Private sector and non-ICA Europeangovernment investments in 2017dropped to their lowest levels since2013, with totals of $6m and $51m,respectively. Only one project receivedprivate finance. The $19m Butamahydro plant in Uganda was privatelyfinanced with $6m along withbilateral contributions from the USOverseas Private InvestmentCorporation. Non-ICA memberEuropean contributions came solelyfrom the Netherlands and wereinvested in energy projects in Ugandaand Kenya.n

Figure 90Trends in East Africa financing by source, 2013-2017

Figure 89Total financing to East Africa by sector and source, 2017


8.5 Southern Africa


2013 2014 2015 2016 2017

10,000

6,000

4,000

2,000

0

8,000

$m

6,000

2,000

0

$m

12,000

4,000

3,126

716

846

525 1073780046

2,173

313550000

2,474

047

00004

1,995

3,769

1,793

0

12,021

9,926

5,030

6,196

1,310

259250

7,140

649755358

1,989920

321

02,389

741221

100

153

102

1,384

4,721

3001190

1,307

0


ICA members

China


* 2014 total includes $19msubnational financing


Private sector


China

ICA members

Private sector

Total:5,768

1,609

3,763

531 5664

Total:16,164 14,438* 15,638 6,524 6,524

Investments across SouthernAfrica in 2017 totalled $12.2bnrepresenting a significantincrease compared to 2016($6.5bn). Transport projectsreceived $5.8bn, followed byenergy ($3.8bn), water ($1.6bn),multi-sector ($566m) and ICT($531m) projects.

Angola received the most investmentwith $3.8bn, followed by Zambia($1.9bn) and Madagascar ($959m)while Malawi received the mostinvestment when excluding statefunding ($929m).

All sources of finance increased in2017 with a significant contributioncoming from state funding ($6.2bn),which increased by 31% compared to2016 to reach its highest level since2014. Angola’s government budgeted$3.5bn for domestic infrastructure,primarily in the energy ($1.7bn) andtransport ($1.4bn) sectors. Transportand energy project budgets acrossSouthern Africa increased by 51% and104%, respectively.

China continues to provide significantinvestment in Southern Africa.Although it has not reached the recordlevel achieved in 2015 ($7.1bn), it didincrease its contribution in 2017 to$1.3bn compared with $300m in 2016.Investments were made in energy($741m), ICT ($378m), transport($153m) and multi-sector ($35m)projects. In the energy sector, a $44mloan was provided for the Gwandasolar project in Zimbabwe and anadditional $30m was provided to buildan 88kV transmission line from theInsukamini solar plant to Lupane. Inthe ICT sector, China invested $280mto construct 1,009 telecom towers inZambia along with $98m for abroadband project in Zimbabwe.

ICA members contributed a total of$3.8bn into Southern Africa in 2017,with the commitments focused ontransport projects, which attracted$2.4bn. Madagascar received the mostinvestment ($822m) followed by

Zambia ($561m) and Mozambique($450m). Japanese financingconstituted the majority of investmentwith $1.5bn committed. The AfDBcommitted $143m towards atransportation improvement projectin Namibia that will upgrade railwaysbetween Walvis Bay and Kranzberg tospeed up passenger and freight traffic.The road from Windhoek to theinternational airport will also beupgraded. The project will beimplemented over a three-year period.

India invested in Southern Africa witha $500m line of credit for the SBMInfrastructure Company in Mauritiusto help public sector entities financeand implement domestic infra-structure projects

Private investment returned toSouthern Africa in 2017 after its

absence in 2016, with commitments of$321m, led by the energy ($221m) andtransport ($100m) sectors. TheCentral Termica de Ressano Garciagas plant in Mozambique received$130m in private finance alongsidemultilateral commitments from theIFC, Miga and AFD. Meanwhile,Investec Bank provided a $25m loanfor the Ejuva I solar plant in Namibia.

Regional development banks and ACGmembers contributed $74m and$58m, respectively, both increasingtheir commitments compared to 2016.Notable investments included theKuwait Fund for Arab EconomicDevelopment’s $20m loan for anirrigation project in Zimbabwe andthe Trade and Development Bank’s$30m loan to the Zimbabwe PowerCompany. n

Figure 92Trends in Southern Africa financing by source, 2013-2017

Figure 91Total financing to Southern Africa by sector and source, 2017


8.6 Republic of South Africa


2

4,000

2,000

0

$m

3,707

607

0.200078

1290000

00

1,500

710288

2,307

0006

00


Private sector


China

ICA members

Total:3,995

2,312 2,178

79 129 0

2013 2014 2015 2016 2017

8,000

0

6,000

4,000

2,000

$m

1,1211,529

1,740

0

3,495 3,384

3,855

6,699

495

3,132

3,813

1,500

15

2,238

0

6,307

2140 0

500658

966

2354


ICA members

China


A

Total:7,801 4,928 11,669 8,646 8,694

In 2017, commitments to theRepublic of South Africa totalled$8.7bn, largely unchanged from2016 ($8.6bn). However, thecommitments did not reach the$11.7bn recorded in 2015.

While the majority of funding sourcesmaintained or increased theircommitments, there was a noticeableabsence of private investment in RSA.

The absence is likely to be attributedpartly to delays in the RenewableEnergy Independent Power ProducerProcurement (REIPPP) programme.

Transport projects received the mostamount of investment in South Africaattracting a total of $4bn.

Water projects followed with $2.3bn.Energy projects received $2.2bn,multi-sector projects received $129mand $79m was invested in ICTprojects.

Chinese investment increasedconsiderably in 2017 to $1.5bn – a solecommitment from China DevelopmentBank for the 4.7GW Medupi coalpower station – compared to $500m in2016.

ICA member commitments dropped tothe lowest level since 2013. In 2017commitments amounted to $495m, asignificant drop from the $966mcommitted in 2016 and the $1.7bncommitted in 2015. DBSA committedthe majority of ICA members’investment with $398m.

Commitments for transport projectsincreased in 2017, reversing thedeclining trend of the past few years.Transport projects received the bulk ofICA commitments with $288m, ofwhich $224m was provided by theDBSA. This is higher than the ICAmembers’ 2016 transport commit-ments when a total of $3m wasprovided.

In the water sector, ICA contributionscontinued their decline with $5.9m, an

84% decrease compared to the $37mrecorded in 2016.

The most noticeable decrease ininvestment was for energy projects,with $71m committed in 2017compared to $298m in 2016. Notablecontributions include DBSA’s $18mloan for the replacement of powerlines in Polokwane and GIZ’s $11m forthe South African-Germany EnergyProgramme, which aims to improvepublic and private investment inrenewable energy and energyefficiency.

Multi-sector projects received $129m,a 76% decrease compared to 2016($549m).

Contributions included a $50m loanfrom the IFC to Ekurhuleni

Municipality and a $45m loan fromDBSA for Dannhauser municipality’scapital expenditure programme.

In addition to the absence of privateinvestment, there were nocontributions from ACG members ornon-ICA European governments. n

Figure 94Trends in RSA financing by source, 2013-2017

Figure 93Total financing to RSA by sector and source, 2017


1. General RemarksICA member commitments anddisbursements should be viewed inperspective given the very differentstrategies and purposes of eachmember and no two members’financings are directly comparable interms of the amounts or type offunding they commit or disburse.

It should also be noted that some bilateral members provideconsiderable support to multilaterals,which is not attributed to them in thisreport. For example, ICA membersincluding Canada, France, Germany,Japan, the UK and the US contributeto the AfDB’s African DevelopmentFund (ADF) and the World Bank’sInternational Development Asso-ciation (IDA).

As in 2016, this year’s report coversdata from the AfDB, DBSA, CDC, EU-AITF, EIB, Canada (MFA / CDP)France (AFD, Proparco and FFEM),Germany (KfW, GIZ and DEG), Italy,IFC (which together with the WorldBank is described as the World BankGroup (WBG)), Japan (JBIC andJICA), UK (DfID and CDC), the US(MCC and Power Africa interagencyof USAID) and the World Bank.

No data was made available by theEC in time for this report. Data fromthe EC has featured in previousreports.

Four Regional Economic Comm-unities (RECs) and Regional PowerPools (RPPs) responded to a requestto submit data to inform this report.Data was provided by Central AfricanEconomic and Monetary Community(CEMAC), East African Community(EAC), Southern African Develop-ment Community (SADC) andSouthern African Power Pool (SAPP).

2. Data RevisionDue to the availability of new data,the 2016 commitments figure hasbeen restated as $66.9bn in

Annex 1 – Data Notes

Infrastructure Financing Trends inAfrica, 2017 from the $62.5bnreported in Infrastructure FinancingTrends in Africa, 2016. (See below,African State Spending – BudgetAllocations, for details).

3. Exchange RatesExchange rates used for conversionsinto US Dollars are the averages ofthe respective currencies for 2017 asreported in publicly availableAfrican Development BankFinancial Information.(www.afdb.org/en/documents/financial-information/exchange-rates).

For ICA members the followingexchange rates were used:

$1 = 0.7253345454 AfDB Unit ofAccount (UA)

$1 = 0.8986864796 Euro (€)

$1 = 0.7829140194 British Pound (£)

$1 = 1.306971855 Canadian dollar(C$)

$1 = 13.35293147 South AfricanRand (ZAR)

$1 = 112.7079821 Japanese Yen (¥)

4. Soft InfrastructureFinance is allocated to softinfrastructure in many ways, thusmaking it hard to capture this type offunding in a granular way. For someICA members, the distinctionbetween hard and soft infrastructureis sometimes difficult to make andmight therefore not be fully accurate.Also, the judgement of whether a partof the project is dedicated to, forexample, capacity building or projectpreparation can sometimes be achallenge.

5. African State Spending –Budget AllocationsData on national governmentspending was collected from 47

countries in 2017 compared with arevised 49 in the previous year due tothe publication of sufficiently detailedbudget information from threecountries becoming available after thepublications of last report. This year’sdata also includes some subnationaldata from South Africa.

For these reasons a revised figure forAfrican state spending in 2016 of$30.7bn has been used to enable truecomparison of data from 2016 with2017. The revised total was reachedby increasing the $26.3bn in the 2016report by $4.4bn of newly identifiedgovernment budget allocations. Therevision includes the addition ofbudget data for the Central AfricanRepublic, Chad and EquatorialGuinea and additional state sub-national spending identified for SouthAfrica.

Data is drawn from budgetstatements and speeches, expenditureframeworks, or other officialgovernment documents. The datareflects approved budget allocationsfor either the 2017 calendar year, or acountry’s budgetary year of which themajority falls within 2017. For thepurposes of expediency as well asconsistency, commitments made viaapproved budget allocations arecaptured rather than actual spending.Wherever possible, only capitalexpenditure has been captured. n


Annex 2 – Transport Sector Map

CAPEVERDE

PRAIA

A N G O L A

S O U T HA F R I C A

MADAGASCAR

BOTSWANA

ZIMBABWE

Z A M B I A

ESWATINI (SWAZILAND)

LESOTHO

MALAWI

TANZANIA

KENYA

UGANDA

RWANDA

BURUNDI

GABON

N A M I B I A

DJIBOUTI

ERITREA

S U D A NN I G E R

CENTRALAFRICAN REPUBLIC

EQ. GUINEASÌO TOM� & PRêNCIPE

REP.

OF

CO

NG

O

CAMEROON

M A L I

A L G E R I AL I B Y A

E G Y P T

TUNISIA

MOROCCO

Western Sahara (under UNmandate)

MAURITANIA

MAURITIUS

R�union(Fr.)

SENEGAL

GAMBIA

GUINEA BISSAUGUINEA

SIERRA LEONE

LIBERIA

CïTEDÕIVOIRE TOGO

BENIN

MO

ZA

MBIQ

UE

S OM

AL I A

COMOROSMayotte

(Fr.)

Annob�n(Eq. Guinea)

BURKINAFASO

GHANA

(BRA

ZZA

VILL

E)

N I G E R I A

SEYCHELLES

E T H I O P I A

DEMOCRATICREPUBLIC

OF CONGO

SOUTH SUDAN

C H A D

Johannesburg

Durban

Port Elizabeth

Bloemfontein

Beira

Cabinda (Ang.)

Mwanza

Dar es Salaam

Mombasa

Nampula

Ndola

Bulawayo

Lubumbashi

Kisangani

Mbuji-Mayi

Benguela

Douala

Berbera

Port Sudan

ElFasher

Lagos

Kano

Port HarcourtAbidjan

Alexandria

Luxor

Aswan

Benghazi

Casablanca

Marrakech

Oran

Francistown

Walvis Bay

EastLondon

Tangier

Agadez

Wau

Timbuktu

Nouadhibou

El Ayoun

Sfax

Atar

Reggane

Tamanrasset

Constantine

Tobruk

N�maSt-Louis

Kayes

Kankan

Gao

Kumasi

BoboDioulasso

Ibadan

Arlit

Zinder

Enugu

Maiduguri

Sarh

SuezPort Said

Safaga

Minya

Wadi Halfa

Atbara

Kosti Assab

MassawaKassala

Kismayo

Mtwara

Pointe-Noire

Matadi

Kuito

Namibe

Tsumeb

Livingstone

Blantyre

Toliara

Mahajanga

Toamasina

Inhambane

Kimberley

Cape Town

Arusha

Mossel Bay

Pietermaritzburg

L�deritz

Taolagnaro

Pemba

Mongu

HuamboLuena

Kananga

Mbandaka

Port-Gentil

Bukavu

Songea

Mbeya

Tanga

MoyaleLokichokio

Hargeisa

Bosaso

GaroweDire

Dawa

WadMedani

GuluIsiroButa

Bunia

Kound�ra

AbuSimbelBordj

Mokhtar

OujdaF�s

Biskra

Annaba

Tozeur

Nyala

Zou�rat

KadunaParakou

Sekondi-

Takoradi

Franceville

Ilebo

Kalemie

Solwezi

Kamina

Kindu

Bumba

Kigoma

Kasama

Antsirabe

Tete

Nacala

Malanje

Menongue

Lobito

Upington

Lamu

Musina

Vryburg

Lubango

Jorf Lasfar Gharda�a

Bizerte

Sabha

Ghat

In Am�nas

Nz�r�kor�

Sokoto Gedaref

Ou�sso

Ikela

Luau

Saurimo

Kuvango

Maun

Springbok

Oudtshoorn

MananjaryFianarantsoa

Ermelo

Mbala

Gonder

Dese

Mekele

Richards Bay

Saldanha

Tema

Beja�a

Damietta

Giza

Malakal

Agadir

Hurghada

Sharmel-Sheikh

Marsa Alam

K�nitra

Bagamoyo

Ab�ch�

Al-Kufra

Antsiranana

Kribi

TangerMed

National boundary

Principal road

Main railway

Busiest airports, 2016(over 1m passengers)

L.Tana

L.Tanganyika

LakeVictoria

Lake Malawi(L.Nyasa)

L.Kivu

L.Albert

L.Volta

L.Chad

L.Nasser

L.Turkana

S a h a r aLi b

yan

De

se

rt

At l a s M o u n

t a i n s

Niger

Benue

Nile

Blue

Nile

U�l�

Con

go

Kasa�

Zambezi

Vaal

Orange

Sinai

Zanzibar I.

CapeAgulhas

TROPIC OF CAPRICORN

TROPIC OF CANCER

Cape ofGood Hope

Pemba I.

Mafia I.

Cape Hafun

Cap Bon

Jerba

CapriviStrip

Copper- belt

White

Nil e

L.Mweru

L.Edward

Chari

Omo

Juba

Limpopo

Cairo

Tripoli

Algiers

Dakar

Kano NÕDjamena

Wad Medani

Gonder

Djibouti Ville

Mombasa

Nairobi

Lagos

Lobito

Cape Town

Beira

1

2 3 4

3

3

4

4

1

5 5 6 6

7 8

8

9

9

EQUATOR

T � n � r �

PRETORIA

MAPUTO

WINDHOEKGABORONE

HARARE

ANTANANARIVO

LUSAKA

LUANDA

KINSHASA

BRAZZAVILLE

NAIROBI

LILONGWE

LIBREVILLE

YAOUND�BANGUI

KAMPALA MOGADISHU

ADDISABABA

ASMARAKHARTOUM

NÕDJAMENA

ABUJA

NIAMEY

ACCRA

LOM�

PORTO- NOVO

YAMOUSSOUKROMONROVIA

FREETOWNCONAKRY

BISSAU

DAKAR

BAMAKO

CAIRO

NOUAKCHOTT

TRIPOLI

TUNISALGIERS

RABAT

DJIBOUTIVILLE

MORONI

PORT-LOUIS

MBABANEMASERU

BANJUL

MALABO

SÌO TOM�

BUJUMBURA

DODOMA

JUBA

OUAGADOUGOU

KIGALI

VICTORIA

TRANS-SAHARANTRADE ROUTESAncient trade routesthat crossed the Sahara Desert havebeen adapted for formal and informal trade,including a variety of smuggling networks.

TRANSGUINEAN RAILWAYSProposed rail links taking minerals to a planned deep-water port SE of Conakry.

BENGUELA RAILWAYLinking the port of Lobito with the DRC, it provided an export route for Zambianand Congolese copper during the mid-20th century. Heavily damaged during theAngolan civil war (1975-2002), the route has been rehabilitated with Chinese help.

GREAT EQUATORIALLAND BRIDGEA project to link the east and westcoasts by road, rail and oil pipeline,from Douala in Cameroon to Lamuin Kenya via Bangui and Juba.

TRANS-AFRICAN HIGHWAYSAn international programme to develop a transcontinental road network.NORTH-SOUTH ROUTES:TAH-2: Algiers-Agadez-Lagos (Trans-Sahara)TAH-3: Tripoli-NÕDjamena-Kinshasa-Windhoek-Cape TownTAH-4: Cairo-Khartoum-Addis Ababa-Nairobi-Lusaka-Gaborone-Cape TownEAST-WEST ROUTES:TAH-1: Cairo-Tripoli-Algiers-Rabat-DakarTAH-5: Dakar-Bamako-NÕDjamenaTAH-6: NÕDjamena-DjiboutiTAH-7: Dakar-Freetown-Abidjan-LagosTAH-8: Lagos-Yaound�-Bangui-Kisangani-Nairobi-MombasaTAH-9: Lobito-Lubumbashi-Harare-Beira

WALVIS BAY CORRIDORSA network of transport corridors linking NamibiaÕs largest port with:1. SOUTH AFRICA: TRANS-ORANJE, to Pretoria/Johannesburg via Upington,with a link to L�deritz; TRANS-KALAHARI, to Pretoria/Johannesburg via Botswana.A railway line to export Botswanan coal is proposed, to run alongside the highway.2. ZAMBIA: TRANS-CAPRIVI, a strong competitor to the Tazara railway forZambian and DRC copper exports. 3. ANGOLA: TRANS-CUNENE.

MOROCCOHIGH-SPEED RAILThe first tranche of AfricaÕsfirst high-speed line will linkTangier with K�nitra in oneand a half hours from late2018, and is plannedto continue to Rabatand Casablanca.

ADDIS ABABA AIRPORTSBole International Airport is being expandedto triple its capacity. A new airport is plannedwith four runways and a passenger capacityup to 80m passengers/yr.

NEW EGYPTIAN AIRPORTSThe construction of five new airports was announced in 2017: SphinxInternational Airport in Giza, New Capital Airport, Bredwell Airport in Sinai,South Red Sea Airport and Ras Sidr Airport. Japan is funding a newpassenger terminal at AlexandriaÕs Borg El Arab International Airport.

DAKARÕS NEW AIRPORTBlaise Diagne International Airport opened in December2017. Costing $575m, it has a capacity of 10m passengers/yr.

KHARTOUM NEW INTERNATIONAL AIRPORTKNIA is planned to replace the existing airport, witha capacity of approximately 7.5m passengers/yr.

DJIBOUTIChinese-funded projects includethree ports, two airports and awater pipeline from Ethiopia, aswell as a Chinese military base.

SINGLE AFRICAN AIR TRANSPORT MARKETSAATM is a flagship project of the AUÕs Agenda 2063 and aims to create asingle unified air transport market in Africa, liberalise civil aviation and actas an impetus to the continentÕs economic integration agenda. Officiallylaunched in January 2018 with 23 countries as starting participants.

AFRICAN HIGH-SPEED RAILThe African Union signed an agreementwith China in October 2016 for a five-year action plan for an integrated high-speed railway network.

ETHIOPIA-DJIBOUTI RAILWAYAfricaÕs second electric railway beganoperations in 2016, linking Addis Ababa withDjiboutiÕs new Doraleh Multipurpose Port.

LEKKI DEEP SEA PORTConstruction has begun on developing new container and berth facilities in LagosFree Trade Zone by Singapore-based Tolaram GroupÕs Lekki Port LFTZ Enterprise.

NIGERIA RAILRail upgrades are planned, and a future Lagos-Port Harcourt-Calabar high-speedline has attracted interest from China and the US.

ALGERIAÕS EAST-WEST HIGHWAY (A1)A six-lane 1,200km road running from theMoroccan border to the Tunisian border builtby Chinese (west and central sections) andJapanese (east) consortia.

EGYPTÕS NEW CAPITAL CITYA 700 km2 development 45km east of Cairo with an internationalairport is planned to accommodate 5m and become EgyptÕs newadministrative capital; developed by the government and the military.

NORTH-SOUTH CORRIDORA Comesa initiative comprising a road and rail networkof over 10,000km, linking eight countries in Southern andCentral Africa ( ) with the aim of strengthening cross-border trade and tourism.

TAZARA RAILWAYBuilt with Chinese assistance in the 1970s to link Zambia withDar es Salaam, avoiding Zimbabwe and South Africa.

EAST AFRICANINFRASTRUCTUREProjects include the EastAfrican Railways Master Planand Lamu Port-South Sudan-Ethiopia Transport (LAPSSET)Corridor.

BAGAMOYOA planned new megaportand economic zone northof Dar es Salaam.

MOZAMBIQUEÕS CORRIDORSNACALA CORRIDOR: Linking Malawi to the sea and the newNacala-a-Velha port, the outlet for Moatize coal exports.BEIRA CORRIDOR: An important gateway for landlockedcountries to the west of Mozambique.MAPUTO CORRIDOR: Linking South AfricaÕs industrialheartland with the deepwater ports of Maputo and Matola.A port at Techobanine, south of Maputo, has been proposedto export coal from Botswana.

KRIBI DEEP SEA PORTThe first phase of three is completed and now open; ultimately planned tobe AfricaÕs third largest port after Durban and TangerMed. Rail link plannedto bring iron ore from Mbalam.

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