What are the Africa Infrastructure investment challenges?
In the 2013 ICA survey of private sector infrastructure investors in Africa partner-risk appeared to be the main consideration taken into account when deciding whether to invest, followed closely by concerns about the legal, regulatory and political environment.
When it comes to securing financing, political risk is a serious challenge. Credit and payment risk –and then transparency and corruption were ranked second and third respectively.
The survey responses highlighted critical role of bilateral and multilateral institutions. Most respondents cited multilateral finance support and guarantees is very important in mitigating risk. Respondents consistently said corruption was mitigated by their own internal controls to ensure transparent business partnerships.
GENERAL CONCLUSION: no single risk mitigation strategy emerged from this survey, but most respondents cited the importance of being locally networked and having a strong local partner.