REMARKS OF H.E RAILA ODINGA; EGH, HIGH REPRESENTATIVE FOR INFRASTRUCTURE DEVELOPMENT; NAIROBI; 16TH APRIL 2019:
Let me begin by extending a very warm welcome to all our guests.
Thank you for finding time for this important meeting.
We gather at a time of a renewed realization by Africa that we have to take charge of our destiny as a Continent. That, after all, is what other continents are doing.
Now, more than ever, there is a strong realisation that the fortunes of this Continent do not lie with sympathy and help from abroad, important as those are.
I want to thank the political leadership that is spearheading this push to have Africa look more into what it can do better for itself before turning abroad for help.
We are here to discuss a solemn subject; infrastructure financing.
In the journey of a country’s or a continent’s progress towards prosperity, infrastructure plays a decisive role.
When the US unveiled the Inter-State Highways at the end of the First World War, navigation of the vast continent became easier.
The once daunting rugged terrain got ironed out, cities emerged, shopping malls spouted, restaurants evolved to serve a continent of drivers. Tourism thrived, with chain hotels popping up along interstates and to serve an influx of travellers. The highways turbo charged the economy.
Before the Interstate Highways, the western world had invested heavily in railways.
The US built the first Trans-continental railway across North America in the 1860s; linking the eastern part of the country to the Pacific Coast.
By 1850, western nations had 40,000 kilometres of railways while Africa, Asia and Latin America combined had only 4000 kilometres. One could say that investment in infrastructure is where regions and continents parted ways with regard to development.
This is where we in Africa began to fall behind while others surged ahead.
It is Africa’s turn to take up infrastructure challenge.
We must address it with the fierce agency of now.
We know the challenge. We know what it will take to address the challenge. The infrastructure programme that will turn around the Continent’s fortunes by addressing road, rail, airways, waterways, high-speed broadband connectivity and energy needs are well mapped out.
In fact some, like the Great North Road, and hydropower potential in the DRC, were marked long before the continent became free from colonialism.
But they are yet to be realised.
I wish to congratulate the African Union Commission and NEPAD for the meticulous work in recent years that has seen the Continent map out the Trans Africa highways, the missing links, the high speed rail and the air transport and energy needs and their implementation status.
From that work, we know what we need.
We need a “new frontier” transcontinental corridor – connecting the eastern and western-central Africa and deep-sea ports of Lamu and Douala in Cameroon.
We need a Continental High Speed Freight Railway. This is another important “change-agent” that will have tremendous impact for the African Continental Free Trade Area (AfCFTA).
We need to complete the Trans-Sahara Highway, the Dakar- Ndjamena-Djibouti road and rail, the Kinshasha-Brazaville Bridge, the North-South corridor involving South Africa, Zimbabwe, DRC, Namibia, Botswana, Angola and Lesotho.
We need to complete the International Logistics Infrastructure Hub involving Namibia, Zambia, Zimbabwe, Malawi, DRC and Botswana and we need to complete the Lagos-Abidjan-Dakar highway, to mention but a few.
We have to introduce robust maritime services linking eastern Africa to the North via Lake Victoria through River Nile to the Mediterranean Sea.
We need money and political will.
We need to devise effective and efficient plans to mobilize the requisite resources to fund the identified projects; otherwise the projects will remain mere wish lists.
And that is the reason we are here; to think deeply and creatively about fundraising and project implementation.
We want to act, not as individual nations but as Africa.
As we have seen, there is something for everyone in the continental infrastructure agenda. Lack of viable infrastructure has been one of the key barriers to the long-term development of our economies; making it impossible for Africa’s wealth of natural resources to translate into wealth for our citizens. A strong African infrastructure development agenda will boost member states’ productivity and economic competitiveness.
It will create jobs for millions of youths across Africa and it will ensure business thrives. It did for Europe, North America and Asia. It can’t fail Africa.
We simply can’t compete and thrive in the 21st century with 19th century infrastructure.
It is estimated that our annual infrastructure gap – that is the difference between what we have and what we need – stands at around $170 billion.
Very few African governments have sufficient finances to fund infrastructure investment themselves.
Majority of our nations are forced to rely on either loans from wealthy countries or on private companies willing to take the risk.
There are real concerns over whether African countries can repay the loans they are taking.
We are gathered here to figure out not just how to raise money but also how to ensure the monies come on friendly terms and the infrastructure we get are in line with local needs.
We appreciate the efforts by various global players to help address Africa’s infrastructure challenge. We take note that the G-8 Summit established the Infrastructure Consortium for Africa (ICA) to promote public and private investment in infrastructure.
We equally recognise the AfDB’s Africa50 Infrastructure Fund launched in 2013 to mobilize resources and support the development of key projects.
The Private Infrastructure Development Group (PIDG) was started in 2002 to develop commercially viable projects and provide long-term finance to private sector infrastructure projects is equally a commendable effort as is the Power Africa initiative by the US to mobilize investment and reform and enhance access to electricity.
Equally important is the World Bank’s Global Infrastructure Fund (GIF), which was created as a platform for identifying, preparing, and financing large complex infrastructure projects.
All these programs highlight the shared concern for the infrastructure deficit in Africa and we appreciate them and we will continue working with these programmes.
But we need to do two things.
One, we need to identify more local sources for infrastructure financing.
Two, we need to get together as a Continent and approach all these global financing institutions and lending nations as a Continent and not as individual countries. That, in my view, will give us better bargaining power, better value for money and better ability to repay.
There is growing consensus that by thinking creatively and differently, we can tap into a number of local finances that are currently largely idle; to finance our infrastructure needs on more friendly terms.
Before we look abroad, we need to look at our Central Banks, African Pension Funds, Insurance companies and local Sovereign Funds.
We believe that countries like Botswana, Namibia, South Africa, Kenya, Angola, Morocco, Egypt and Nigeria have pension funds that can be tapped into to fund infrastructure.
We need to address the governance and regulatory obstacles that limit the allocation of these funds for infrastructure development. We also need to explore ways to partner with our commercial banks so that we can tap into their reserves to finance infrastructure.
All these could come under an Africa Continental Infrastructure Fund under the auspices of AU to pool financial resources. I believe the creation of such a fund would be strategically and symbolically valuable.
I want to believe that we all agree that there is reason for us to get down to work, that some of the people to do this work are in this room and that we are all willing to apply our minds and resources and roll up our sleeves for Africa.
I wish you fruitful deliberations.