Page 187 - Volume 2_CHANGES_merged_with links

Obstacles to progress

Realities

The lack of infrastructure also meant that African countries were dependent on Western

economies for much of their energy. Even oil-rich countries did not have the refineries needed
to turn their crude oil into gasoline or heating oil.”

"The Biggest Challenges Faced by African States at Independence." 214
Angela Thompsell, Professor of British and African History,

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“ Infrastructure investment is widely recognised as a crucial driver of economic development.
215
Work undertaken by Calderón et al. (2014 & 2015) gave rise to estimates that a 10 percent
increase in infrastructure provision increases output per worker by about 1 per cent in the long
run. 20

The World Bank has estimated that the poor state of infrastructure in Sub-Saharan Africa - its
electricity, water, roads and information and communications technology (ICT) - cuts national
economic growth by two percentage points every year and reduces productivity by as much as

40 percent.
Other studies provide considerable supporting detail :

74 per cent of firms in Low Income Developing Countries (LIDC) experience power outages-
compared to 53 percent in Emerging Markets (EM). Furthermore, the average firm in LIDCs
experiences 11 power outages per month, which implies a cost of 7.1 percent of annual sales.

In contrast, in EMs firms have to deal with 4.3 power outages per month, which cost 3.4
percent of annual sales.

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Despite significantly faster growth, electricity generation capacity in LIDCs - even in frontier

markets-remains considerably lower than in emerging markets (9344.5 GW vs. 141065 GW on
average in 2015, according to the UN database). Furthermore, electricity supply is also less

reliable.
Road density also lags behind (0.18 vs. 0.4 km of road per 100 km2 of land area), although the

gap is smaller.
Mobile phone penetration made huge strides from near zero in 2000 to 72 per 100 people in
2014, but was still significantly lower than 118 per 100 people in EMs.

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Data collected through a survey of IMF country teams confirm that funding constraints are a

common impediment to scaling up infrastructure investment. “
"Trends and Challenges in Infrastructure Investment in Developing Countries." 216
Gurara, Daniel, Vladimir Klyuev, Nkunde Mwase, and Andrea F. Presbitero

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