Recently Dr Amani Abou-Zeid Commissioner for Infrastructure and Energy African Union Commission said that on the ground some The Programme for Infrastructure Development in Africa (PIDA) projects have made significant move.
She further noted that infrastructure forms the backbone of the Africa economy, having responsible for more than half of African’s recent improved growth performance and with potential to contribute even more in the future.
Data by World Bank shows that as of January 2018, Tanzania’s economy grew by 1.62tri/- (726.8 million US dollars) in the first half of the current financial year. It registered a GDP of 25.5tri/- (11.5 billion US dollars) compared to 23.9tri/- (10.7 billion US dollars) in the corresponding period in 2016. Tanzania recorded the best growth rate in the East African Community.
"The government was receiving certificate of clearance from contractors who have implemented various projects and payment claims amounting to 70bn/- monthly," the Minister said, adding that the good thing was that most of the outstanding debts are being cleared by the government.
"It is worth noting that the government has managed to clear a huge amount of outstanding debts it owes contractors," he said.
He added that when the fifth phase government came to power, the outstanding debt stood at 1.268tr/- and after verification, the government had settled most of the outstanding arrears to contractors by June 2016.
On his part Engineers Registration Board (ERB), the Committee Chairman, Prof Norman Sigala lauded the government, saying it was on the right track in terms of implementing infrastructural development projects in the country, while also noting that the ministry was doing a great job by creating an environment in accordance with Section 43 of Public Procurement Regulatory Authority (PPRA) regulation to help local contractors grow.
He said there have been a number of initiatives geared towards fostering the local construction industry, which include building capacity of local contractors and consultants. "The goal of the construction industry development is to develop local contractors, enabling them to have an internationally competitive edge.
This will make them able to undertake most of the construction projects in Tanzania and export their services and products outside the country," he said.
The Programme for Infrastructure Development in Africa (PIDA) is a strategic continental initiative which has the buy-in of all African countries, for mobilizing resources to transform Africa through modern infrastructure which will unlock the continent’s huge growth potential and put Africa on the path to accelerated economic and social development.
African economies are growing rapidly propelled by new resource discoveries, urbanization, a youthful population, deepening regional integration arrangements and increased integration of the continent into the global economy.
These developments require sound and versatile infrastructure and the enabling environment for the infrastructure systems to perform efficiently and optimally. PIDA identifies priority continental projects in trans-boundary water, energy, transport and ICT to be realised by 2040, will have the greatest transformational impact on the continent.
That is – projects that, if executed – will catalyse further infrastructure investments; open up important trade routes for landlocked countries; dramatically increase access to improved transport, electricity, ICT and water services; and support other economic activities. The total estimated investment cost is US$360 billion, or around US$9 billion per year which is less than 1% of Africa’s GDP.
The PIDA Priority Action Plan (PAP) includes 51 priority projects and programmes across the major infrastructure sectors and regions of Africa at a cost of US$68 billion.
Africa presently receives about US$50 billion per annum in development assistance, and imports around US$55 billion in food every year. Investing less than US$70 billion over the next 8 years in the selected infrastructure projects could unlock an increase in trade up to 25% and additional GDP growth of up to 2% per year.
PIDA priority projects were selected based on rigorous economic analysis and selection criteria, taking into account national and regional infrastructure development plans, and in close consultation with Member States, Regional Economic Communities (RECs), development partners and the private sector.
At their 18thAfrican Union Assembly, African Heads of State and Government formally adopted PIDA as a continental programme signalling high-level political commitment to adopting a coordinated continental strategy to tackle the continent’s infrastructure needs in a bold and innovative way.
In approving PIDA, the Heads of State called for concerted action by all concerned to mobilise the necessary resources to make PIDA a reality by rallying African and international partners, both public and private to work together to make the vision of a transformed Africa, a reality.
The African policy makers recognised that the lack of capacity and funds in project preparation combined with a weak involvement of the private sector are the main issues that constitute the bottlenecks to PIDA implementation.
As a response, they set up the Continental Business Network (CBN) to facilitate private sector involvement in essential continent-wide infrastructure projects through the creation of a high-level private sector forum.
This is an outstanding instrument towards a common understanding of the investment risks (and rewards) regarding infrastructure projects.