Business
Africa needs massive investment in infrastructure - IMF
Publish Date: May 30, 2014
Africa needs massive investment in infrastructure - IMF
IMF Managing Director Christine Lagarde (R) being greeted by local singers as she attends the opening session of the Africa Rising Conference, on Thursday at the Chissano Conference Center in Maputo. PHOTO/AFP/AMF
  • mail
  • img
newvision

MAPUTO - Africa's fast growing economies need to spend $93 billion a year just to bring infrastructure up to speed, the head of the IMF said on Thursday, sketching out the daunting challenges still faced by the continent.

Opening a major meeting for finance ministers and central bankers in Maputo to plot Africa's rise, Christine Lagarde said the continent still faced massive challenges.

"Only 16 percent of all roads are paved, compared with 85 percent in South Asia. These shortfalls represent huge costs to business -- and to people."

Sub-Saharan African economies, some of the fastest growing in the world, are expected to expand by more than five percent this year.

But poor infrastructure, including a lack of capacity in electricity production and poor roads, is seen as curbing growth.

"High quality infrastructure can be a magnet for foreign investment," said Lagarde.

After years of hailing Africa's economic development, policy makers want to usher in a second phase of development that sees economic gains benefit all.

While the emergence of a middle class has boosted consumer growth, much of the continent's growth has come from oil, gas and other natural resources.

"Let me be frank, in too many countries, the rents from extractive industries are captured by just a few," said Lagarde.

"Mining can account for an important share of output and export earnings, but often contributes relatively little to budget revenues and job creation."


Oxfam's Winnie Byanyima: "Africa is not rising for ordinary citizens"

Beyond the corridors of power and conference talk-shops, Africans are increasingly frustrated by the lack of good jobs.

"Jobs are scarce," says Maputo street vendor Ercilia, who sells bread to passers by. "Some days I make a living and some days I don't."

"I believe in Africa some day all this will change," said security guard, Marcelino Jaime, noting that few jobs were available for uneducated young people.

"In Africa we need a lot of creativity to improve things," he added.

Lagarde earlier hailed the leaps made by African economies in the last decade as "nothing short of remarkable."

But as policymakers take stock of Africa's strong economic performance, many are also looking at the risks that lie ahead.

The region could face lower demand for its exports should growth slow in increasingly important emerging markets like Brazil, India and, in particular, China.

Beijing is a top buyer of African resources from copper to oil and gas.

In rapidly growing cities such as Maputo the Chinese presence is manifest, from a Chinese-built airport to the country's businessmen chattering on cell phones as they walk from meeting to meeting.

But poverty perhaps remains the continent's biggest challenge.

Ahead of the meeting, rights groups questioned the current optimistic view of "Africa's rise".

"Africa is not rising for ordinary citizens," said Oxfam International's Executive Director Winnie Byanyima.

AFP


Also related to this story

IMF boss hails 'remarkable' African growth

Ugandan economy seen picking up steam, says IMF

IMF tells gov't to invest in areas that will create jobs

IMF tips Uganda on economic growth benefits sharing

The statements, comments, or opinions expressed through the use of New Vision Online are those of their respective authors, who are solely responsible for them, and do not necessarily represent the views held by the staff and management of New Vision Online.

New Vision Online reserves the right to moderate, publish or delete a post without warning or consultation with the author.Find out why we moderate comments. For any questions please contact digital@newvision.co.ug

  • mail
  • img
blog comments powered by Disqus
Also In This Section
Procuring and Disposing Entities (PDEs) of both public and private bodies have been advised to dialogue with bidders who do or are interested in doing business with them...
Shilling to weaken further, foreign currency denominated loans to suffer
Bankers have expressed concern over the continued depreciation of the shilling, saying the volatility will exert pressure on foreign currency denominated loans...
Access to finance biggest obstacle for MSMES
The biggest obstacle to business growth faced by Micro, Small and Medium Enterprises (MSMEs) in Uganda is access to finance, according to a survey released by FSD Uganda...
UNRA earmarks sh1.5bn for skills development
As the government moves to spend more on infrastructural development, UNRA has earmarked $500,000 (about sh1.5b) to register engineers in the country....
CSOs call for gov’t action on depreciating shilling
Civil society actors have expressed concern over the high US dollar-Ugandan shilling exchange rate, saying if ignored, it will have a negative impact on the implementation of the 2014/2015 financial budget....
Reflexologists granted permission to sue govt for loss
The Commercial Court in Kampala has granted reflexologists permission to sue government for losses suffered when a ban was imposed on their activities on March 24, 2011....
Will the ban of food vendors help eliminate typhoid?
Yes
No
Can't Say
follow us
subscribe to our news letter