By Irene Gaitirira
Published May 27, 2016
A new private sector partnership led by General Electric (GE) is set to benefit African infrastructure has been created.
GE has partnered with Mara Group and Atlas Merchant Capital to invest in power generation, transport, oil & gas and mining across Africa.
Though Africa’s population that is set to hit the 1.5 billion mark by 2025 presents promising economic growth potential, the continent’s infrastructure is not only under-developed but it also lacks the funds for developing it.
General Electric, Mara Group and Atlas Merchant Capital say they shall facilitate access to capital “to execute and fully finance both advanced and early development stage projects.”
Among hurdles to address, the partners say, are “rapid urbanisation and a growing middle class devoid of infrastructure.” They say that more than 50% of African countries, including Nigeria, Kenya, Ethiopia, Tanzania and Congo-Kinshasa,lack “access to electricity and an infrastructure investment of US$360 billion in power production, power transmission, water storage, modern railways, port capacity” and that “modern highways will be required by 2040” and that “Africa needs to spend US$90 billion a year for the next decade in order to upgrade and maintain its existing infrastructure alone.”
“This joint venture unifies three businesses with a strong commitment and expertise in infrastructure in Africa. The joint venture is our response to an integrated infrastructure approach in Africa,” says Jay Ireland, President and CEO of GE Africa. “We are proud to partner with the expertise and talent of Atlas Merchant Capital and Mara Group, who have an extensive footprint in Africa, to address the necessities of the African continent. We have been significantly involved in social enterprises to date and will seek to further enhance and promote social and community development in the region to complement their expertise, knowledge and entrepreneurial spirit.”
Ashish J Thakkar, Founder of Mara Group, says, “Africa is a continent of 54 countries, but there is very low connectivity between them. Intra-African trade, a key driver for economic growth, represents only a fraction of Africa’s total trade over the past decade and this is largely due to a growing shortfall in infrastructure development. Through our joint venture with GE and Atlas Merchant Capital, we hope to tackle the funding deficit by creating a platform that has the power to truly change the lives of those living on the continent.”
Welcoming the partnership as one that “can have a real impact on infrastructure development in Africa,” Akinwumi Ayodeji Adesina, President of African Development Bank, says, “We all know painfully well the imperative to fill Africa’s annual US$50 billion infrastructure funding gap. Partnerships like these are a crucial part of the development agenda as we seek to promote social and economic development and fight poverty in Africa.”