China, India and a number of Middle Eastern Gulf Nations are financing a record number of infrastructure projects across Sub-Saharan Africa, a report from the Accra Office of the World Bank said on Friday.The report, which quoted a new World Bank report, said investment commitments in Africa by these emerging financiers jumped from less than US$ 1b per year before 2004 to US$ 8b in 2006 and US$ 5bn in 2007, signaling a growing trend in cooperation among developing economies (South-South cooperation).
Under: "Building Bridges: China's Growing Role as Infrastructure Financier for Sub-Saharan Africa" the report shows how new infrastructure partnerships are emerging, driven by strong economic growth in the Region, an improved business-friendly climate, and rising demand for petroleum and other commodities from China and India.
Obiageli Katryn Ezekwesili, World Bank's Vice President for the Africa Region, said: "China's success story in reducing poverty through rapid and sustained growth is remarkable. Massive investment in infrastructure was a key factor."Today China's growing infrastructure commitments in Africa are helping to address the huge infrastructure deficit of the Continent.
There are of course challenges which will need to be addressed by African nations and China coupled with the support of development partners," he said, adding, "by working together, we can create win-win partnerships".The report said: "Africa faces daunting challenges in improving its infrastructure. Development experts agree that creaking infrastructure is cutting the growth rate of African economies by as much as one percentage point every year. One in four Africans does not have access to electricity.
Travel times on African roads and export routes are two to three times higher than in Asia, increasing the prices of traded goods. Power generation capacity is around half the levels achieved in South Asia. "The report notes that the investment commitments being made by emerging financiers are unprecedented, both in scale and the focus on large infrastructure projects.
In a changing world, with new actors and financing modalities coming into play, there is a learning process for investors and recipients. This will place new demands on national capacity to negotiate complex and innovative deals, and apply appropriate environmental and social standards needed for the long-term success of such partnerships.
"Sub-Saharan Africa's natural resource exports to China have grown exponentially, from just over $3 billion in 2001 to US$ 22bn in 2006.? Petroleum dominates, accounting for 80% of total exports to China. evertheless, the bulk of Africa's oil exports still go to the United States and Europe, which together receive 57% of the total, compared with only 14% going to China.
Other important African export commodities are iron ore and timber, followed by manganese, cobalt, copper and chromium.The World Bank is working closely with African countries, China and other development partners in sharing experiences so that the investments have the best development impact.
China is not the only emerging financier playing a major role in Africa. In recent years, India is increasing its investments, committing US$ 2.6bn since 2003. The bulk of Indian investments were in Nigeria. Oil-rich Gulf states and Arab donors are also playing a substantial role in African infrastructure, committing on average US$ 500m every year over the past seven years. |
