COMESA's Commitment to Infrastructure Development

COMESA 2018 Special Report, By Mandira Bagwandeen*

COMESA 2018 Special Report

One of the most notable examples include the Gibe III, a 1,870MW Hydroelectric Project, located on the Omo River, Ethiopia. Completed in 2016, the plant can produce 6,500 GWh of electricity annually.

On 21 March 2018, 44 African countries signed a historic free trade agreement at the 10th Extraordinary African Union Summit in Kigali, Rwanda. Heralded as a milestone in the continent’s road to integration, the African Continental Free Trade Agreement (AfCFTA) has been lauded by commentators as a catalyst for a better trading and investment environment. A dearth in regional trade infrastructure, however, presents challenges. Africa’s Regional Economic Communities (RECs), and their commitment to developing the needed infrastructure is of paramount importance. Amongst Africa’s eight RECs, the Common Market for Eastern and Southern Africa (COMESA), recognises the importance of transport, ICT, energy, and trans-boundary water infrastructure in its efforts to become an internationally competitive REC by 2025.1

Show of Commitment

The current worth of intra-regional trade within COMESA is $20 billion, with the potential for over $82.3 billion.2 The lack of cross-border infrastructure networks, however, is a significant trade barrier as it hinders intra-industry exchange between businesses in the region.3 As such, addressing the lack of quality infrastructure is key to COMESA’s agenda of “inclusive and sustainable industrialisation”. In November 2012, regional members resolved to fast-track the joint infrastructure projects needed to enhance regional development.

The COMESSA Infrastructure Fund (CIF) is further demonstrative of the dedication to establishing an “efficient and dependable economic infrastructure system” in the region. Although still being finalised, the CIF is intended to leverage resources from public and private investors’ funds, acting as seed capital. According to COMESA, the fund aims to raise $2 billion, at least, for bankable infrastructure projects across various sectors.

Infrastructure Projects

With a combined value of $60.7 billion, COMESA members have (to date) undertaken various infrastructure projects aimed at improving regional economic development.4 Some notable projects are mentioned below:

Transport

In the transport sector, massive road projects have been undertaken along major transport corridors, including the Djibouti Corridor, Lamu Corridor, the Northern Corridor, Central Corridor, Dar es Salaam Corridor and the North-South Corridor. Additionally, there are several plans for new railways modernisation efforts along the Djibouti-Lamu-Nacala line. A notable inland water transport project is the Shire-Zambezi Waterways project, a 283 km canal estimated to cost $6 billion.5 The aim of the project is to provide Malawi, Mozambique, and Zambia with cost-effective and reliable modes of water transport.

Energy

On the energy front, the growing demand for electricity has resulted in several power generation projects. One of the most notable examples include the Gibe III, a 1,870MW hydroelectric project located on the Omo River in Ethiopia. Completed in 2016, the plant can produce 6,500 GWh of electricity annually.6 There are also many interconnection projects which COMESA and the Tripartite (COMESA-EAC-SADC) are involved in, including the 2,300km Zambia-Tanzania-Kenya (ZTK) Power Transmission Project. The ZTK interconnector endeavours to not only link the three countries but also create a connection to the Southern Africa Power Pool and the East African Power Pool, making it possible to convey power from the Cape to Cairo.7 The Zimbabwe-Zambia-Botswana-Namibia (ZiZaBoNa) interconnector project (estimated at $59 million) is scheduled to be completed in 2019. ZiZaBoNa will facilitate power trading across the four nations, alleviating bottlenecks on the north-south transmission corridor (from South Africa to Zimbabwe) and it will add a 400kV western corridor to the Southern African Power Pool.8

Information and Communications Technology (ICT)

The $300 million COMTEL regional connectivity project is a testament to the importance that COMESA places on ICT and its key role in intra-regional and international trade.9 This multinational broadband project aims to connect the networks of member countries, thereby providing a cost-effective regional telecommunications network that could greatly facilitate economic integration.10 Furthermore, COMESA has proposed the creation of a digital free trade area, to be divided into three parts: e-trade, e-logistics, and e-legislation. Collectively, these segments will “promote e-commerce by providing an online platform for [regional] traders to do business online.”11

COMESA’s infrastructural challenges stem from both a lack of resources and capacity among its members to plan, coordinate, implement and maintain reliable and effective infrastructure networks. These challenges have, however, not translated into a lack of determination, as COMESA has demonstrated a regional commitment to infrastructure development via numerous infrastructure projects. Going forward, COMESA is likely to forge ahead with infrastructure developments, and especially those projects which hasten economic integration. COMESA’s need to construct, update and modernise infrastructure has created a sizeable market for foreign investors that possess the skills and technology to build its members into not only regional economic forces but also global economic players.

References:

1 https://www.tralac.org/news/article/11245-comesa-call-for-papers-2017-boosting-intra-african-trade-through-recs.html

2 https://www.tralac.org/news/article/12223-comesa-s-trade-potential-pegged-at-over-us-80bn.html

3 http://www.comesa.int/comesas-trade-potential-pegged-at-over-us80bn/

4 http://africamoney.info/comesa-to-hold-infrastructure-summit-fast-track-projects/

5 http://www.engineeringnews.co.za/print-version/shire-zambezi-2016-02-19

6 https://ethiopia.salini-impregilo.com/en/projects/gibe-iii-hydroelectric.html

7 https://www.esi-africa.com/ztk-power-interconnector/

8 https://www.executiverelocationsafrica.com/zizabona-power-project-advances/

9 http://www.comesa.int/wp-content/uploads/2016/06/comesa-in-brief_2014.pdf

10 http://www.itwebafrica.com/telecommunications/335-africa/237961-comesa-seeks-to-revive-dormant-us30m-comtel-project

11 http://www.newtimes.co.rw/section/read/228217/



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