Modern Mining May 2022

MINING News

African Governments maintain infrastructure spending despite rising debt

Transport and Energy & Power projects as having consistently been key contributors to the sectoral mix of projects underway, with the Real Estate sector – most promi nently Commercial Real Estate – emerging as a critical sector in recent years. “African governments continue to play a critical role as owners of infrastructure proj ects and both public and private investors have managed to help increase spending even through the pandemic,” said Alex Moir, industrial products and construction leader at Deloitte Africa. African govern ments own 73,8% of projects under review. African Governments have also consis tently been the top funders at 31,8%, with

African Governments maintained spend ing on infrastructure, in spite of Covid and rising debt levels. At the same time, West Africa has, for the first time since 2016, led the continent in both the number and value of infrastructure projects. These are some of the findings of the Deloitte African Construction Trends 2021 Outlook report , which tracked infrastructure and capital projects (I&CP) activity across Africa. The report analyses who owns, funds, and builds infrastructure projects. The number of projects in 2021 increased by 20%, from 385 projects in 2020. The total value of projects under construction increased by 30.7%. Deloitte highlights

international development finance institu tions (DFIs) and African DFIs as important financiers too. The share of projects funded by China stood at 10,6% in 2021, the sin gle largest by country or region. China remained the largest builder on the conti nent with 21,4%. In this edition, West Africa is, for the first time since 2016, leading by the number and value of projects, with 153 projects valued at $172,8 Bn. Southern Africa recorded the second largest project share by value at $147,7 Bn, followed by North Africa at $132,2 Bn. East Africa’s high growth and economic development saw the region lead by the

number of projects annually over the three-year period from 2018. Last year the region recorded 102 projects at $60,6 billion, a decline from 118 projects at $77,7 Bn in 2021. In the Southern African region, in value terms, the Real Estate sector recorded a share of 52% ($76.7 Bn). The high value of proj ects in the Real Estate sector was fuelled by investments in some mega projects in Mozambique and South Africa. Industrial Real Estate projects in recent years in Mozambique include the Rovuma LNG Project and the Coral South Floating LNG Projects. Energy & Power accounted for 27.3% ($40.3 Bn) of the projects underway. Despite the Transport sector having recorded the most projects, the sector came third in value terms, contributing 8.6% ($12.6 Bn) in Southern Africa respectively. 

African governments continue to play a critical role as owners of infrastructure projects.

4  MODERN MINING  May 2022