Background: Infrastructure as one of the most important constraints for Africa’s development
According to the African Union Commission (AUC) Medium-term Plan 2018-2023 “Delivering AU Reforms and Accelerating Agenda 2063”, infrastructure is the cornerstone of the African economy. Investment in infrastructure accounts for over half of the recent improvement in economic growth in Africa and has the potential to achieve even more. Africa has undergone fundamental changes over the last decade, which in turn has fuelled demand for infrastructure services including energy, transportation, ICT, water supply, growing agriculture and urban infrastructure. Infrastructure is a key ingredient for sustainable development. However, infrastructure continues to be rated as one of the most important constraints for Africa’s development, due to shortage in finance.
The support of the European Union to African Infrastructure:
The African Union (AU) and the European Union (EU) pursue intense dialogue to increase investment in infrastructure, services and regulatory reforms to develop efficient and sustainable regional infrastructure networks. During the 5th AU-EU Summit in Abidjan in November 2017, both sides decided on further cooperation and actions in Infrastructure under the joint priority area “Mobilizing Investments for African structural sustainable transformation” for the period leading up to the next Summit. Under this priority area, they committed (art. 65 of the Abidjan Declaration) to “continue to promote intra-Africa trade and advance greater economic integration, notably by further developing sustainable connectivity, building on the Programme for Infrastructure Development in Africa (PIDA), NEPAD programmes and the AU Agenda 2063 flagship projects, NEPAD Presidential Infrastructure Champion Initiative (PICI)” and to “promote the full implementation of the 1999 Yamoussoukro Decision with a view to establishing and strengthening a single Africa Air Transport Market“. The AU-EU cooperation on infrastructure focuses on the four PIDA sectors: Energy, Transport, Water and Information and Communication technology (ICT). In this context, our project, a Technical Assistance to the African Union/Infrastructure Support mechanism (AU/ISM), was devised.
Infrastructure deficits including Energy, Transportation, ICT, Water supply and urban infrastructure have been acknowledged to be the biggest constraints on economic development in Africa.
The Technical Assistance to the African Union/Infrastructure Support mechanism (AU/ISM) aims to support the African Union in addressing these challenges by building the capacities of policy makers, regulators, the private sector, civil society, and technical community in policy and regulatory issues.
The Technical Assistance to AU/ISM, started its duties on 11 November 2019, commenced its first encounter with the EUD to AU, represented by the Programme manager in charge and with an introductory meeting with the Director of the AUC Department of Infrastructure & Energy.
It will last till December 2022.
The current project is part of the Multi-annual indicative programme (MIP) for the Pan-African programme 2018-2020. It is the 2nd component of the EU programme entitled “Boost African continental Integration, EU-Africa economic integration through enhanced evidence-based policy making on trade and investment”.
The overall objective of the Programme is: “to boost African continental economic integration and EU-Africa economic integration”
As stated above, this action is part of a wider action to promote economic integration. In fact, the programme highlights the importance of this action in the context of establishing of the AfCFTA in order to deepen economic integration and investment, from both Africa and the rest of the world, particularly, the promotion of the rules-based free market agenda and to enhance the investment environment.
The AfCFTA and investment in general are clearly priorities of the EU- Africa partnership. The Abidjan Declaration adopted during the 5th AU-EU Summit identifies investment as one of the Joint Africa EU strategic priorities: “mobilizing investment for African structural transformation” (with reference on the EIP). The component 2, named, Investment, is thus perfectly in line with the main objectives of the AU-EU strategy, and will impact the different proposals for investments as part of the Africa Investment Platform (AFIP) under the European Fund for Sustainable Development (EFSD) of the External Investment Plan (EIP).
The EIP provides a new integrated approach: in order to increase sustainable growth and job creation in Africa, more investments and the improvement of the investment climate in African partner countries are required. In the field of infrastructure this ISM TA will complement the work executed of maximizing the alignment of AU and EU instruments and achieving better cross-sectoral coordination.
The Specific Objective of the Programme is “Enhanced evidence-based policy making on trade and investment”.
The programme objective reinforces the idea of incorporating economic integration into policy making. The improvement of infrastructures, main objective of the project, is thus relevant because seen as a prerequisite for growth and economic integration and vice versa, growth will attract investments that will enable infrastructure investments. We thus understand very clearly the link and complementarity between the Programme and the Project objectives.
The Overall Objective of this action is to: “Help improving access to integrated regional and continental infrastructure networks in the fields of water, energy, transport and ICT”.
The overall objective and project purpose responds to the need to develop and enhance regional and continent infrastructure network. The development of infrastructure is seen as an essential prerequisite for ensuring sustainable growth rates and thus a decrease in the poverty rates in the African continent.