ISS African Futures

This report by the Institute for Security Studies examines the infrastructure investment gap in Africa, detailing the financial shortfalls, the role of continental frameworks like PIDA, and the challenges of mobilising both domestic and private capital to support sustainable growth.

• Africa faces a significant infrastructure investment gap, requiring between US$130 billion and US$180 billion annually. Despite existing finance inflows, an annual shortfall of US$68–108 billion remains. This deficit is most acute in water and sanitation (41%), followed by electricity supply and transport access (approximately 28% each).
• The Programme for Infrastructure Development in Africa (PIDA) is the primary continental framework for cross-border infrastructure. While PIDA Priority Action Plan 1 (2012–2020) saw the construction of over 16,000 km of roads, 4,000 km of railways, and 3,500 km of transmission lines, only 18% of targeted projects were operational by 2025. The subsequent PIDA PAP2 (2021–2030) prioritises 69 projects valued at roughly US$125 billion.
• Several initiatives support the infrastructure pipeline and finance mobilisation. The NEPAD Infrastructure Project Preparation Facility (NEPAD-IPPF) approved 106 grants totalling US$115 million between 2004 and 2022, leveraging US$11 billion in investment. Additionally, the EU's Global Gateway aims to mobilise up to EUR 150 billion between 2021 and 2027, having allocated nearly EUR 624 million in grants to regional projects by the end of 2024.
• Public-private partnerships (PPPs) and concession models like build-operate-transfer (BOT) are used to mobilise private finance, but they present risks regarding affordability and debt. For example, the Mombasa–Nairobi Standard Gauge Railway increased Kenya's debt burden due to commercial-rate Chinese loans, and the Nairobi Expressway's toll-based profits may limit access for low-income users.
• Africa possesses over US$1.1 trillion in domestic capital, including US$777 billion in pension and insurance funds and US$400 billion in sovereign wealth funds and public development banks. However, these are often underutilised for long-term infrastructure. Further potential exists in the informal economy, which could generate over US$200 billion in savings if partially formalised, and remittances, which exceeded US$95 billion in 2024.
• Project preparation is a critical barrier to private investment; early-stage development can take up to seven years and cost 5–12% of total project costs. Consequently, up to 90% of infrastructure projects in Africa fail before reaching financial close, with about 80% stalling at the feasibility stage.

APA

Institute for Security Studies (n.d.). ISS African Futures. https://futures.issafrica.org/thematic/guide.pdf?thematic=11-large-infrastructure&topic=08-infrastructure-investment-need

Chicago

Institute for Security Studies. ISS African Futures. n.d. https://futures.issafrica.org/thematic/guide.pdf?thematic=11-large-infrastructure&topic=08-infrastructure-investment-need.

Wikipedia

{{cite report |author=Institute for Security Studies |title=ISS African Futures |url=https://futures.issafrica.org/thematic/guide.pdf?thematic=11-large-infrastructure&topic=08-infrastructure-investment-need |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{instituteforsecuritystudiesndiss, author = {{Institute for Security Studies}}, title = {{ISS African Futures}}, institution = {Institute for Security Studies}, url = {https://futures.issafrica.org/thematic/guide.pdf?thematic=11-large-infrastructure&topic=08-infrastructure-investment-need}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }