Summary:
- Infrastructure is critical to the successful implementation of the AfCFTA, enabling trade connectivity and regional integration.
- With an annual infrastructure financing deficit of $80 billion a year, Africa needs to significantly scale up its efforts towards financing the development of key infrastructure.
- African IFIs have been at the forefront of infrastructure financing efforts; however, African governments (constrained by rising debt-to-GDP and low tax-to-GDP ratios) remain the main investors in infrastructure.
- More coordinated and robust efforts to increase private investment flows are necessary.
- African IFIs could benefit from a more results-oriented, institutionalised coordination model with clear objectives and measurable outcomes aligned with AfCFTA goals and trade-enabling infrastructure development.
- By institutionalising coordination, local development finance institutions and regional IFIs would be compelled to align their strategies, harmonise their reporting mechanisms and collectively track progress against agreed-upon key performance indicators.
