THE European Investment Bank (EIB) has called for increased collaboration between government and the private sector to secure funding for international lenders, amid Zimbabwe requiring US$2 billion in annual infrastructure financing till 2032.
A study by the World Bank and others suggests that Zimbabwe requires US$2 billion annually for economic infrastructure financing until 2032.
Through the European Union’s (EU) lending programmes funded by the bloc’s EIB, over US$100 million had been accessed by Zimbabwean banks such as CABS, First Capital Bank Zimbabwe, Stanbic Bank Zimbabwe and NMB Bank.
Speaking during a panel discussion on day two of the EU-Zimbabwe Business Forum held in Harare this week, EIB regional representative for southern Africa, Jim Hodges, said securing funding for projects was a bit of a race.
“Infrastructure development in Africa is a complex process that requires a joint endeavour between governments, development banks and the private sector. We need to work together to unlock significant investment in critical infrastructure sectors,” Hodges said.
“The European Investment Bank is committed to supporting governments in Africa in developing the necessary skills and expertise to engage with the private sector and implement large-scale infrastructure projects.”
He noted that many governments in Africa faced fiscal constraints, limiting their ability to borrow and invest in large-scale infrastructure projects, and were thus looking to the private sector to fill the financial gap.
In Zimbabwe’s case, the country has a public debt of over US$21 billion, with over half of that amount being owed to foreign lenders.
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“Accessing sovereign concessional lending is a critical step in securing funding for infrastructure projects, but it’s often the biggest bottleneck,” Hodges said.
“We need to find ways to overcome this challenge and unlock new opportunities for growth and development.”
He emphasised the importance of engaging with the private sector early for successful infrastructure development.
“Governments need to develop the necessary skills to do so, including expertise in public-private partnerships and infrastructure investments,” Hodges added.
He also highlighted that infrastructure projects with the private sector were long-term commitments that required careful planning and preparation, often lasting 20, 30 or 35 years.
“It’s essential that they’re done right. We’re encouraging governments to start moving in these areas to facilitate infrastructure investment and unlock new opportunities for growth and development,” Hodges said.
“With the right partnerships and preparation, Africa can achieve its development goals and improve the lives of its citizens.”
