AU & AFC New Push. The African Union is setting up an infrastructure fund to help bridge the continent’s infrastructure financing deficit of $ 60 to 90 billion a year. Raila Odinga, African Union’s high representative for infrastructure, said the continent was facing infrastructure financing difficulties thanks to donor fatigue and higher debt levels. China, one of the biggest external funders of infrastructure in Africa, has sharply reduced its funding because of fears of default by some of the countries. “Africa is financially starved as far as the need for infrastructure development is concerned,” said Odinga. The new fund would finance the construction of roads, railways and power plants. African Union officials were working out the legal and financial structure of the fund. The fund will be administered by the newly-created African Union Development Agency.

Africa has been the main funder of its own infrastructure, but needs considerable external assistance. The plan is to ask pension funds and sovereign wealth funds of Angola, Egypt, Kenya, Nigeria, and South Africa to invest about 5% of their holdings in the fund. This might require the creation of special purpose vehicles as sovereign wealth funds and similar bodies generally cannot put money into non-investment grade funds.

In a bid to garner more institutional investor interest, the Lagos-based Africa Finance Corporation plans to shift its energy portfolio towards greener projects, says its new chief investment officer Sameh Shenouda. The corporation’s board agreed to bundle  a number of its solar, wind and hydro projects in several countries and possibly have this floated on the London Stock Exchange as a separate firm. While investors were interested in opportunities in green energy on the continent they could not spend time scouting out relatively small 50-60 megawatt projects, he said. “So we will deliver an opportunity that gives them higher returns and access to a market they haven’t cracked yet.” The Africa Finance Corporation is an infrastructure-focused development bank established in 2007 and 42% owned by Nigeria’s central bank. It has invested $ 8.7 billion in projects in 35 African countries across power, telecoms, heavy industry, logistics and transport. The corporation has raised money in several Asian markets including China, Singapore and Malaysia. In December, the US International Development Finance Corporation provided $250 million to strengthen the bank’s capital base.

China Tech Cities. The increasing support provided by China to African states to expand their information infrastructure and the rise of Safe City (promoted by Huawei) and Smart City (promoted by ZTE) projects across Africa has raised concerns about a possible tightening of civil liberties on the continent. Case studies show that Chinese firms are amenable to letting the host government set the rules for internet governance but have no qualms in setting up systems that are open to official abuse.

Chinese companies are key providers of internet communications technology in Africa but nowadays go well beyond just setting up networks. The smart city and safe city projects are largely about surveillance and have raised worries that China is exporting its own state-centric internet models to Africa. The primary selling point the Chinese firms make to African governments is that these technologies are useful for crime fighting. However, studies show that the impact on crime is normally shart-lived.

Nigerian Projects. Nigeria plans a series of billion-dollar projects to help pull its economy out of its worst recession in 40 years. But President Muhammadu Buhari has been criticized for funnelling too much money to his native north, operating with minimal transparency and allowing too much Chinese corporate involvement. The government broke ground for a $2 billion internationally-funded rail line connecting the country's north to neighbouring Niger. It also announced it was forming Infraco, a public-private infrastructure fund with $ 2.6 billion in seed capital collectively from Nigeria’s central bank, the Nigeria Sovereign Investment Authority and the Africa Finance Corporation. Next month, the government plans to start a $3 billion railway line that would link Port Harcourt in the south to Maiduguri in the north. Almost the entire rail line fill be financed and constructed by Chinese banks and firms.

Local Capital. Gyude Moore, senior fellow at the Centre for Global Development and ex-Public Works Minister of Liberia, has argued the continent needs to harness more local capital for infrastructure. A report by the Infrastructure Consortium of Africa found that between 2013 and 2017, the average annual funding for African infrastructure development was $ 77 billion of which 42% came from African governments. Moore points out that for all the ballyhoo about China, the truth is that over the past 20 years China has financed the making of 6000 km of roads. In comparison, the distance from Lagos to Algiers alone is 4500 kms. He has proposed African governments set up a National Infrastructure Trust Fund (NITF). “The NITF would be a coordinating institution to plan, design, and supervise the construction of infrastructure projects. It would be a central clearing house for feasibility studies, balancing economic viability and social impact…It must be established by law and its top officials professionally recruited.” Multilateral financial institutions could create a synthetic guarantee for the fund’s first decade.

Badly Placed Roads. A study by the National Bureau of Economic Research used satellite data, trade flows and other information to work out whether Africa’s road infrastructure was built in the most optimal locations. The study found that while roads built using World Bank funding are more spatially diverse than Chinese aid, World Bank funds are more directed toward regions with a surplus of road infrastructure. Between 25 and 33% of international aid flows from China and the World Bank share the same geographic destination and there is a positive relationship between World Bank and Chinese aid and an overabundance of roads.

The study found that Nigeria has relatively efficient road infrastructure, and very few optimal routes require walking, while Mali exhibits large, concentrated swathes where walking is the optimal method of transportation. Ethiopia’s optimal routes vary according to sub-region but its transportation infrastructure is predominately structured north-to-south and less east to west.

Ivorian Power. One of Africa’s best infrastructure successes has been the Cote d’Ivoire’s power sector. The country privatised large portions of its power sector and today has enough installed capacity to fulfil domestic demand and export about 10% of it power production. Only 34% of Ivorians had access to electricity in 2013, today close to 94% of them are connected to the grid and the poorest group receive subsidized power. Private operators are currently responsible for 70% of energy production and 100% of its distribution. The grid is expected to cover 99% of the population by 2035, and 42% of the energy produced will come from renewable sources.


African countries are caught in quandary over accepting the Group of Twenty’s pandemic debt relief funding – if they do they are likely to see their credit ratings cut and their borrowing costs rise. Fitch Rating’s head of the Middle East and Africa sovereign ratings, Jan Friederich, told Reuters that Fitch would downgrade any country that took up the G-20 debt relief offer. 

Kenya, for example, recently reversed its earlier stance and accepted G-20 debt relief measures to defer $690 million in debt payments to help weather the economic impact of Covid-19. Early this year, Kenya received  a $ 300 million loan repayment break from the Paris Club of international creditors and further $ 390 million from China under the G-20 Debt Service Suspension Initiative (DSSI) framework. Kenya had turned down the G-20 initiative in May saying the terms were too restrictive and would affect its  credit rating. The deal limited countries’ access to international capital markets and this would hinder Kenya’s ability to finance its budget deficit. Fitch’s warning confirmed Kenyan fears of the commercial fallout of accepting debt relief. Kenya presently has an issuer default rating of B+.

Ethiopia’s credit score was reduced by two grades after the country signalled it would use a new G-20 Common Framework plan. The country’s rating was reduced to CCC, signalling a real possibility of default on debt owed to private creditors. “It would be likely that any other countries applying under the G20 Common Framework would be considered along the same lines as Ethiopia,” Friederich said.  Fitch would only hold back if it was confident private-sector creditors who hold the bonds to which credit ratings apply would be unaffected. Congo, Gabon, Mozambique and Angola are already in the default danger zone CCC rating category. Kenya, Ghana, Cameroon and Cape Verde are likely to join the list.


The director of the Africa Centers for Disease Control and Prevention Dr. John Nkengasong has said Africa needs to produce its own vaccines following its experience during the Covid-19 pandemic. At least five African countries appear to have the capacity to produce vaccines, he said, citing South Africa, Senegal, Tunisia, Morocco, and Egypt. A meeting is planned for April 12 between the African Union and outside partners like the European Union to create a “roadmap” for boosting African capacity to eventually manufacture Covid-19 vaccines in the continent rather than be wholly dependent on imports. Twenty-two African countries have received Covid-19 vaccines under the global Covax programme of which over 70% are manufactured in India.

The death of Tanzanian President John Magufuli was announced on March 17 after having disappeared from public view for two weeks. The country’s new president and the first female to hold the post, Samia Suluhu, said Magufuli had died of heart failure at the age of 61. The former president wore a pacemaker. The country’s new acting president, Samia Suluhu, said Magufuli had died of heart failure at the age of 61. Magufuli was best known internationally for his eccentric response to the Covid-19 pandemic, initially denying the spread of the virus in Tanzania and then holding national prayers to drive the illness away. He claimed vaccines were dangerous, promoted herbal cures and discouraged the use of masks. Tanzania stopped publishing data on Covid deaths even while reports came in of overwhelmed hospitals and overworked graveyards. Magufuli’s own chief secretary and a number of prominent party members are believed to have died of Covid-19. Magufuli was also headstrong in other ways, suspending the Chinese-led $ 10 billion Bagamayo port project over what he felt were exploitative conditions. During his public absence, the Tanzanian opposition claimed Magufuli was being treated in a hospital in India for Covid-19.


A decade after negotiations began, India signed a free trade agreement with Mauritius in March. While the agreement covers less than a thousand export items, combining the lists of the two countries, New Delhi sees the agreement as a means to get access to the economies of the African Continental Free Trade Area and the European Union. Mauritius is a signatory to the first and has a preferential trade agreement with the latter. The agreement also allows India to provide a small response to claims that India has not been able to conclude any trade agreements since 2010.

Africa has a thriving but fragmented local film industry with the $ 600 million Nigerian cinema industry (“Nollywood”) being the largest cluster. Netflix has arrived in the continent and begun commissioning films for the continent. While there is some arthouse and reworks of Nollywood classics, the streaming giant is looking at producing films and shows of the lighter variety. While Nigeria and South Africa, the two biggest film markets in sub-Saharan Africa, are its primary targets its executives say they are also looking at Kenya, Ghana, the Democratic Republic of Congo and, later on, places like Angola and Mozambique. It is expected to showcase some of its new products at the Zanzibar and Durban film festivals. Africa’s film market is estimated to be worth $1.5 to 2 billion a year, nearly two-thirds the size of Bollywood but local film-making has struggled thanks to a lack of infrastructure in many part of the continent, a lack of government support and a lack of a continent-wide market.

(The views expressed are personal)


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About the Author

Pramit Pal Chaudhury

Pramit Pal Chaudhuri, Foreign Editor, Hindustan Times, and Distinguished Fellow & Head, Strategic Affairs, Ananta Aspen Centre

Pramit Pal Chaudhuri writes on political, security, and economic issues. He previously wrote for the Statesman and the Telegraph in Calcutta. He served on the National Security Advisory Board of the Indian government from 2011-2015. Among other affiliations, he is a member of the Asia Society Global Council, the Aspen Institute Italia, the International Institute of Strategic Studies, and the Mont Pelerin Society. Pramit is also a senior associate of Rhodium Group, New York City, advisor to the Bower Group Asia in India, a member of the Council on Emerging Markets, Washington, DC, and a delegate for the Confederation of Indian Industry-Aspen Strategy Group Indo-U.S. Strategic Dialogue and the Ananta Aspen Strategic Dialogues with Japan, China and Israel. Born in 1964, he has visited over fifty countries on five continents. Mr. Pal Chaudhuri is a history graduate from Cornell University.