Africa: A Snapshot of Key Infrastructure Development Plans on the Continent

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Africa: A Snapshot of Key Infrastructure Development Plans on the Continent

  1. 1. Infrastructure in Africa “A Snapshot of Key Infrastructure Development Plans on the Continent”PresenterKudzanayi BangureProgramme Manager – Infrastructure Division
  2. 2. Kudzanayi Bangure Functional Expertise • Experience in strategy consulting and market research, which include over 30 significant market research and growth consulting projects. Particular expertise in: − Local and global consulting engagements with experience in the following − Commercial due diligence analysis − Strategic analysis of new markets − Development of market entry strategies − Geographic expansion strategies − Analysis of emerging markets − Opportunity analysis − Analysis of Infrastructure development in Sub-Saharan Africa Industry Expertise  Long-standing working relationships with leading industry participants’ Senior Executives.  Experience base covering a broad range of sectors which include the following  African Infrastructure (Energy, Telecommunications, Transportation and Water Infrastructure)  Built environment (Construction, Green Buildings)  Building Technologies (Lighting, HVAC, Security, BMS, Facilities Management)Kudzanayi Bangure  Automotive & TransportationProgramme Manager What I bring to the TeamAfrican Infrastructure, • Strategic Thinking • Econometric AnalysisAutomotive & Transportation • Project and Team Management • Economic Modelling • Client and Relationship Management • Financial Analysis & ModellingFrost & Sullivan Africa • Market AnalysisSouth Africa, Cape Town • Competitor Analysis • Customer Analysis Education • Bachelor of Commerce in Economics and Information Systems from Rhodes University • Honours in Financial Analysis & Portfolio Management from the University of Cape Town 2
  3. 3. ContentsSection Slide NumberAfrica Infrastructure Overview 3Road Infrastructure Analysis 7Rail Infrastructure Analysis 8Energy Infrastructure Analysis 9Mega Infrastructure Projects 10Conclusions 12Contact Details 14 3
  4. 4. Africa – Key Infrastructure Statistics $604 billion $440 billion 31% 21% % of Annual spending Is the current % of investment in needed for the next spending on investment in Sub-Saharan five years to infrastructure Sub-Saharan Africa on upgrade, rehabilitate development in Sub- Africa on energy and and expand Africa’s Saharan Africa transport power infrastructure infrastructure infrastructure 30 $145 50 years Is the It will take 50 number of billion years for most countries in South Africa is countries in Africa which currently Africa to reach have regular investing $145 universal access power billion in to modern outages infrastructure infrastructure 50% 70% Infrastructure In land-locked development has countries, transport been responsible accounts for 70% for more than of the value half of Africa’s of exported improved goods economic performanceSource: World Bank and Frost andSullivan analysis*based on active projects in 2011
  5. 5. Infrastructure Africa: Market Outlook Infrastructure Development in Sub-Saharan Africa Transport Energy Total investment $136 billion $93 billion amounts to $440 billion Legend: Investment ($ billion) < 0.5 0.5 – 1.0 Number of high value 1.0 – 5.0 projects, many valued 5.0 – 10.0 >$1 billion 0.0 – 15.0 15.0 Water Social Telecoms $15 billion $43 billion $17 billion Most projects valued < $100 millionSource: Frost and Sullivan analysis*based on active projects in 2011 5
  6. 6. Infrastructure Africa: Market Outlook $440 billion is being invested in infrastructure development in Sub- Saharan Africa South Africa is the leader in infrastructure development on the continent, investing $145 billion Social Nigeria and Mozambique(Includes housing, hospital account for 8.9% and and school construction) 7.7% of infrastructure investment Water Sector $230 billion will be invested in the Telecoms transport and energy and power sectors Energy Transport 0 20 40 60 80 100 120 140 Investment ($ billion)Source: Frost and Sullivan analysis South Africa Nigeria Mozambique Tanzania Ghana*based on active projects in 2011 Zambia Botswana Namibia Uganda Kenya 6
  7. 7. Infrastructure Africa: Market Outlook What impacts infrastructure development on the continent? Expansion of the mining industry and Drivers increased participation of the private sector Millennium are the key drivers for infrastructure Development development Goal targets Increasing Expansion of private sector the mining Challenges participation industry Project funds have to be secured from the private sector as African countries do not have sufficient public funds to support infrastructure development Restraints Corruption and Reliance on Skills shortage on the continent results in mal- private sector engineers and other skilled labour being imported for administration for funding projects, increasing costs Poor power supply capacity, restricting the Political Instability in the long term increases growth of economies the risk of future projects. This challenge is particularly pertinent in a country like Nigeria.Source: Frost and Sullivan analysis 7
  8. 8. Infrastructure Africa: Market Outlook $28 billion will be invested in transport corridor development in Sub- Saharan Africa Current state of transport infrastructure: Roads in good condition Freight transport by rail Western 72% Western 11% Central 49% Central 2% Eastern 82% Eastern 2% Southern 100% Southern 85% Container dwell times (International standard: 7 days) Ten transport corridors are Western 11-30 days being developed across the Eastern 5-28 days region to improve road and rail networks and increase port Southern 4-8 days capacity Existing road networks will be rehabilitated and expanded Investment will Road $9.2 billion to create nine Trans-African Highways result in greater Rail networks will be extended and upgraded to regional integration Rail $14.8 billion complement the Trans-African highways and significantly Capacity building at ports will decrease bottlenecks and increased intra- Ports $3.5 billion support growth in trade and industry African tradeSource: World Bank and Frost and Sullivan analysis*based on active projects in 2011 8
  9. 9. Infrastructure Africa: Market OutlookRail infrastructure is the fastest growing segment of transportinfrastructureAfrican governments are Morocco Number ofshifting focus towards Active rail projects amount planned projects $14.67B 2large-scale investments to $48 billion 1 Number of ongoing projectsin rail infrastructure inorder to ease the burdenon road networks EthiopiaImproved rail services will $3.70Breduce trade costs and 5 1increase access to Africa’s 3 7 1 7huge population Ghana Kenya $6.40B 3 $405.5M Passenger rail Nigeria Zambia 1 services on the rise... $6.40B $93.8 M 3 Tanzania $4.8 billion is to be invested in Namibia $5.37B metropolitan light rail $2.68B 2 Lagos, Abuja, Maputo and 4 2 1 Mozambique Addis Ababa are all investing in Multi-Country Mega Projects 1 3 $3.66B urban passenger services Botswana-Mozambique- aimed at easing congestion Zimbabwe $7.0B and road traffic pressures in Isaka-Keza-Kigali Botswana $1.9B heavily built up metropolitan (Tanzania-Rwanda) $1.40B areas Namibia-Botswana $1.3B Source: Frost and Sullivan analysis *based on active projects in 2011 9
  10. 10. Infrastructure Africa: Market Outlook $94 billion will be invested in the energy sector in Sub-Saharan Africa  The generation capacity of Sub-Saharan Africa is 68 GW, equal to Spain in Europe  South Africa alone produces 40 GW  Because little development has occurred since the 1980’s, 30 countries in the region suffer from chronic power outages Mining industry drives growth in installed capacity Will continue to be the major 5.0 GW 18.0 GW energy source to 2020 3.6 GW 2.0 GW 2.0 GW 3.3 GW $57.7 billion (12 GW) to be 0.4 GW 0.5 GW developed in renewable 4.2 GW 6.3 GW energies by 2020 across Africa 2009 52.6 GW 2020 111.6 GW 1.7 GW 2.0 GW Governments to encourage 5.2 GW involvement of private 1.1 GW 0.7 GW sector 0.4 GW 0.1 GW 2.2 GW 65.4 GW 2009 10,000 km of transmission lines will be used to exploit 2015 larger scale, cheaper energySource: Frost and Sullivan analysis sources*based on active projects in 2011 40.0 GW 10
  11. 11. Infrastructure Africa: Market Outlook $15 billion will be invested in water and wastewater infrastructure in Sub-Saharan Africa $16.5 billion is required annually to meet the infrastructure gap Less than $1.0 billion is spent on developing infrastructure Access to modern infrastructure: Piped water Flushing toilet 1/0 20/0 Urban 39% Urban 25% Rural 5% Rural 2% 7/2 15/7 10/1 12/6 Water supply has been prioritised across the Legend continent Number of projects WT/ WWT 13/0 6/2 10/0 % of Greenfield projects Large number of projects, valued at less <20% 9/3 than $100 million 20%-40% 4/2 40%-60% 60%-70% Millennium Development Goals are the key 66/13 Number of projects >70% driver for development in the sector Donor organisations fund the majority of Rehabilitation, upgrading and projects in the sector improvement projects characteriseSource: World Bank and Frost and Sullivan analysis development*based on active projects in 2011 11
  12. 12. Infrastructure Africa: Market Outlook Snapshot of Mega-Infrastructure Projects across the Continent $6.3 billion 2,000 MW Wind and $6 billion 2,000 MW Solar Power Plan Development of a new deep sea port $7 billion Rehabilitation of 60,000km of urban and rural roads $10 billion 200,000 low cost houses $2.5 billion $1.2 billion 1600 MW 1,500 km railway line linking hydropower station Namibia to Botswana $14.5 billion World’s 3rd $7 billion largest 1,100 km railway linking supercritical Botswana to MozambiqueSource: Frost and Sullivan analysis coal fired plant via Zimbabwe*based on active projects in 2011 12
  13. 13. Infrastructure Africa: Market OutlookWhere will Africa be in 2020? Urbanisation in Africa will increase by 27% between 2010 and 2020, with Africa accounting for 15% of the world’s urban population Transport corridors will drive trade, economic growth and regional integration Regional Power Pools will ensure security of supply and support economic growth 13
  14. 14. Infrastructure Africa: Market OutlookBottom up approach used to create Frost & Sullivan’s InfrastructureTrackers Infrastructure Tracker CoverageA bottom-up approach is used tocollect project data across ten trackers complete 14sectors for each infrastructuretracker. Country Regional completeProject Level Sector Level Level Level Project level data for ongoing and planned projects are identified for each infrastructure sector Each sector is analysed and compared based on the level of investment and type of investment (public or private), providing a country level view Snapshot of Project Data Slide Countries can be compared, providing a regional outlook Project Data Identified: Sector Coverage: Project Phase Road Telecommunications Project Value Rail Water and Wastewater Start and End Dates Ports Housing Stakeholders Airports Healthcare Financiers Energy and Power Education 14
  15. 15. Contact details Kudzanayi Bangure Programme Manager - Infrastructure Tel: +27 21 680 3207 Cell: +27 76 905 1909 Fax: +27 86 651 9430 E mail: Kudzanayi.bangure@frost.com Guillaume de Bassompierre Business Development Director Tel: +27 21 680 3282 Cell: +27 71 684 0011 Fax: +27 86 651 9430 E mail: Guillaume.Bassompierre@frost.com 15

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