The cost of transport in Africa: A case for AfCFTA

The implementation of the African Continental Free Trade Area (AfCFTA) is poised to revolutionize Africa's transport sector, but it comes with a hefty price tag. In a recent interview, Robert Lisinge, Chief of the Energy, Infrastructure, and Services Section at the Economic Commission for Africa, discussed the need for significant investments to upgrade existing cross-border roads, increase transport fleets, and improve services to accommodate the anticipated surge in trade volumes resulting from AfCFTA. Lisinge highlighted the scale of investment required, with estimates ranging from $90 billion to $170 billion annually for infrastructure development in Africa. Lisinge emphasized that while governments have historically been the primary drivers of infrastructure development on the continent, they alone cannot meet the financial demands of the transformative projects needed for AfCFTA. He underscored the importance of public-private partnerships in securing the necessary funding for infrastructure upgrades and service improvements across various transport modes. The interview shed light on the forecasted increase in transport equipment needs driven by AfCFTA. Through rigorous research and modeling, Lisinge's team estimated the additional trucks, aircraft, and other transport vehicles required to support the expanded trade flows expected under the trade agreement. The analysis revealed that over two million trucks and approximately 240 aircraft will be essential to meet the heightened demand for transportation services. Amidst discussions on funding mechanisms for the transport sector, Lisinge pointed to a range of financing options available to African countries. These options include government financing from national budgets or loans, leveraging infrastructure funds like Africa 50, tapping into sovereign wealth funds, and accessing green funds allocated for climate-friendly initiatives. Lisinge stressed the importance of aligning transport projects with environmentally sustainable practices to qualify for green funding and support the continent's transition to cleaner transport modes. In conclusion, the successful implementation of AfCFTA hinges on substantial investments in Africa's transport infrastructure and services. The continent's ability to enhance cross-border connectivity, expand transport fleets, and embrace sustainable transport practices will be critical in unlocking the full potential of the trade agreement and driving economic growth across the region.