Africa must invest in infrastructure to draw Foreign Investors: DP World Chairman
DUBAI : Public-private partnerships will play a key role to attract foreign investment into Africa, Sultan Ahmed bin Sulayem, Chairman of DP World, said at the Third Africa Global Business Forum in Dubai.
The Chairman said that boosting and diversifying global and intra-regional trade is a prerequisite for sustainable growth in Africa, but it requires a foundation of both hard and soft infrastructure in the first place.
There is estimated to be a gap of $100 billion per annum of hard infrastructure in Africa. Referring to soft infrastructure, bin Sulayem cited legal infrastructure and the ease of doing business, which are important to attract foreign investment.
Africa is very important for DP World as it has six terminals in five African countries with Government partnerships, he said.
More than half of Africa lives in cities, so there is a lot of pressure to build infrastructure, he said. Although building infrastructure is a challenge, opportunities abound in this sector. Citing the risk involved for investors in African countries, he stressed the need for investment protection in Africa. Public-private partnerships are a good option for foreign investors.
He said tardy hard and soft infrastructure is a hurdle in the quick clearance of containers at ports. Citing examples of DP World's inland container terminal in Lahore, Pakistan, and its own rail in India for the quick departure of containers from ports, the Chairman said that ports are an expensive place to store containers.
Bin Sulayem declined to discuss it as the case is in arbitration. The port contributes around 12 per cent to Djibouti's gross domestic product.
"The port is the most modern in Africa with good infrastructure," he added. "In Africa, there is opportunity, but people still perceive risk. By investing there, we give more courage to people," he said.
Referring to poor transport links among African countries, he said it costs around $2,000 to ship a container from China to the Mombasa port in Kenya but it might cost more for it to be shipped, for instance, to Uganda.