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Monday, May 30, 2011

AFRICA: INFRASTRUCURE HOLDING ECONOMIC DEVELOPMENT HOSTAGE

The Africa Infrastructure Development Index (AIDI) ranks Kenya in position 35 out of the 53 countries in Africa, as Seychelles leads while Somalia taking the last position.

However, Kenya has improved over the years in infrastructure development according to AIDI from 19.1 percent in 2006 to 20.3 percent in 2009.

The index uses five components of infrastructure development that have a direct bearing on economic growth: energy development, telecommunications development, paved roads, access to water and sanitation.

AIDI indicate that Kenya is generating a net electricity of 184 Kilowatt-hours Per Capita. This is the electricity which the country is generating from different forms of energy per person in the population. Algeria leads with 1,117 kWh per capita while Zimbabwe ranks the lowest at 668.

In telecommunications development, 50.3 percent of the total population are subscribed to mobile and fixed line. While on roads, the index shows that 14.0 percentage of Kenyan roads were paved by 2009 with either crashed stones, hydrocarbon binder or bituminized with either concrete or cobbled stones.

Further, its indicate that 58.54 percent of Kenyans have access to water while only 28.99 have access to sanitation, social infrastructure.

The Africa Infrastructure Country Diagnostic (AICD) says investment in infrastructure accounts for more than 50 percent of the recent improvement in economic growth in Africa, and Kenya in particular, and it has the potential to do more.

The African Development Bank, chief economist, Mthuli Ncube said in spite of its enormous mineral and other natural resources, Africa has the lowest productivity of any region in the world, and this low productive capacity often finds explanation in its significant infrastructure shortcomings.

Ncube who was speaking at Nairobi during the Africa Economic Research Consortium (AERC) said this is the reason why the international community has been pledging significant support for infrastructure sector from the realization that infrastructure is a key factor for the region to realize its full potential to make advances towards economic growth, internal trade, and poverty reduction like other developed countries.

The commission on Growth and Development by the World Bank also said infrastructure investment is particularly important in growth, arguing that public spending on infrastructure – roads, ports, airports, and power – paves way for new industries to emerge, it is also a crucial in structural transformation and export diversification.

Economic experts have found out that adequate infrastructure is essential for productivity and growth, indicating that transport in particular is an important factor for development. They particularly say road infrastructure will significantly reduce poverty in African countries.

Ncube, who launched the AIDI report today said it will help Africa Countries to assess their strengths and weakness as well as analyze their economic perspective. This will lead to the formulation of informed policies and investment decisions regarding the various components in a country.

The top ten countries of AIDI in 2009 are Seychelles, Mauritius, South Africa, Libya, Egypt, Tunisia, Algeria, Morocco, Cape Verde and Botswana. Of this, five countries are from North Africa, three are small islands countries where tourism constitutes an important sector of their economies. They have therefor traditionally focused on improving infrastructure to attract visitors.

The bottom 10 countries of AIDI in 2009 are Somalia, Ethiopia, Congo Democratic republic, Sierra Leone, Chad, Niger, Madagascar, Eritrea, Central Africa Republic, and Tanzania. A feature of the bottom 10 countries is that most are fragile states and had recently been involved in some form of conflict.

Countries that improved their scores over time, though slightly, among the bottom 10 countries in 2006 are: Madagascar, Niger, and Chad. The improvement comes primarily from better telephone subscription coverage in the population. Madagascar, Niger and chad hardly show any improvement in electricity generation. However, Somalia, Congo, and Democratic Republic, fell in their rankings.

The middle 33 countries showed wide variations in scores and ranking over the period 2006 – 2009. Though some countries moved downward in the rankings, almost all of them improved their scores compared to previous years.

The countries which did well in improving their rankings are: Guinea which improved its score by more than 50 percent from 17.8 to 29.73 and moved up eleven ranks from 32nd to 21st; Congo Republic which moved up ten ranks from 34th to 24th due to improved telephone subscribers share which increased nearly twofold from 28 percent to 59 percent and improved access to water share from 20 percent to more than 41 percent; Rwanda improved its score by more than 80 percent from 13.34 to 24.99and in ranks moved from 41st to 30th also due to improved telephone subscribers which increased from meager coverage of 3.4 percent to more than 24 percent and improved water access to water share from a coverage of 23 percent to more than 62 percent.

For the top 10 countries, ranking did not change much over time except for Tunisia and Egypt. Some countries, such as Mauritius, Lib ya, Tunisia, and Algeria experienced fluctuations in their scores during this period. The rest of the countries, like Egypt, Morocco, Botswana, and Cape Verde consistently improved their scores from 2006 – 2009.

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