African Leaders Adopt the Dakar Agenda for Action

Photo: BenitaNS
Photo: BenitaNS

Dakar, 17 June 2014 (ECA) - African leaders adopted the Dakar Agenda for Action (DAA) to leverage Public-Private-Partnerships for infrastructure transformation and accelerate the implementation of the Programme for Infrastructure Development in Africa (PIDA).  The Dakar Agenda for Action was the main outcome of the Dakar Financing Summit for Africa’s Infrastructure that was held in Dakar on 14–15 June 2014 and hosted by Macky Sall, President of the Republic of Senegal and Chairperson of the NEPAD Heads of State and Government Orientation Committee (HSGOC). Other Heads of State that attended the Summit include, Goodluck Jonathan of the Federal Republic of Nigeria, Ibrahim Boubacar Keita of the Republic of Mali, and Yayi Boni of the Republic of Benin. The Heads of Africa’s major continental organisations, namely, Carlos Lopes, Executive Secretary of the Economic Commission for Africa; Nkosazana Dlamini Zuma, Chairperson of the African Union Commission, and Donald Kaberuka, President of the African Development Bank played active roles in the Summit's deliberations.

Speaking at the event, Mr. Lopes said the importance of infrastructure to economic transformation was well established, noting that closing Africa’s infrastructure deficits would increase the continent’s economic growth by 2 per cent a year and increase the productivity of firms by as much as 40 per cent. Mr. Lopes, who also chaired a High Level Panel discussion on the theme Enabling Policy Environment to Enhance Infrastructure Investment and Bankability, urged delegates to move beyond the lack of political will as a constraint to project implementation. He called on them to focus the debate, instead, on the attractiveness of projects, which was crucial for private sector participation and on “political determination” which connotes a more action oriented approach to addressing Africa’s infrastructure challenges. 

The High Level Panel discussion was informed by an ECA study on the regulatory frameworks for investment in infrastructure in Nigeria, Cote d’Ivoire, Egypt and South Africa. Regarding capacity building, Mr. Lopes highlighted the paradox of inadequate capacity to develop and implement projects in Africa with the continent spending an estimated US$4 billion annually to employ over 100,000 non-African experts for its projects when there are over 300,000 highly qualified Africans in Diaspora, with up to 30,000 of them having doctorate degrees.

Overall, a number of key messages emerged from the Summit that was aimed, among other things, to showcase 16 priority NEPAD infrastructure projects. 

First, project preparation is the main obstacle to progress in the project development cycle. In this regard, Africa continues to lack adequate technical capacity to prepare projects to levels that make them bankable and attractive to the private sector. 

Second, the private sector is generally not keen to finance project preparation and is seeking for guarantees to safeguard its investment in infrastructure – this is linked, in part, to the perception of frequent contract re-negotiations in Africa. Therefore, governments have to take responsibility for project preparation, with the assistance of financial institutions and development partners. In this regard, efforts must be made to fully harness existing project preparatory facilities and to minimise the risks to the private sector.  President Macky Sall called on the AfDB to use the Africa50 Fund to finance the preparation of the 16 projects presented at the Summit. 

Third, the need to enhance the legal and regulatory environment for investment in infrastructure was paramount. In particular, transparency in the procurement and tendering processes for infrastructure projects has to be improved as this reduces project costs and act as an incentive for investors.

Recommendations in the Dakar Agenda for Action cover the areas of project preparation; project segmentation; Diaspora Funds; increased private sector participation; enabling policy environment; and Sovereign Wealth Funds. 

Highlights of the recommendations include:

  • Countries should enact laws to facilitate the participation of private sector in projects;
  • Government and public institutions must focus on financing the preparation phase of projects;
  • Countries should promote the participation of local private sector in Africa’s infrastructure development, notably through favourable local content laws and provision of capacity building opportunities; and
  • Harmonising regional regulatory frameworks for infrastructure development in order to minimise disparities in rules and regulations, including on Public Private Partnerships.
     

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