Sustainability and Infrastructure Investment: National Development Banks in Africa

GEGI Working Paper 002, 10/2015

35 Pages Posted: 2 Jul 2016

See all articles by Daniel Bradlow

Daniel Bradlow

University of Pretoria; American University - Washington College of Law

Christopher Strong Humphrey

University of Zurich

Date Written: June 30, 2016

Abstract

The need for infrastructure finance in Africa is tremendous. A 2009 report by the World Bank suggests that the continent faces needs of US$93 billion per year. More recent studies, pointing to economic and population growth trends and using more sophisticated methods of assessing needs, indicate that infrastructure needs are actually much higher. Existing financing sources have not been able to keep pace.

In this context, the role of national development banks (NDBs) in the continent merits attention. As will be shown below, many African countries have NDBs, although the vast majority are quite small, with limited access to finance and short on capacity. A few, however, are more significant players, particularly in infrastructure (notably in Algeria and South Africa), and others are undergoing reforms under governments that see their potential as an additional source of finance and expertise to promote their country’s development (such as Ethiopia, Rwanda and Uganda).

The aim of this paper is to provide an overview of the activities of NDBs in Africa, and present two case studies of South African NDBs — Development Bank of Southern Africa (DBSA) and the Industrial Development Corporation (IDC) — that may provide lessons for other NDBs in Africa and beyond. Where data permit, the paper considers general characteristics of the NDBs as well as specific information regarding investment in sustainable infrastructure.

Keywords: national development banks, infrastructure, sustainable development

JEL Classification: F20, F30, H54, N27, O10, O19

Suggested Citation

Bradlow, Daniel David and Humphrey, Christopher Strong, Sustainability and Infrastructure Investment: National Development Banks in Africa (June 30, 2016). GEGI Working Paper 002, 10/2015, Available at SSRN: https://ssrn.com/abstract=2802713 or http://dx.doi.org/10.2139/ssrn.2802713

Daniel David Bradlow (Contact Author)

University of Pretoria ( email )

Physical Address Economic and Management Sciences
Pretoria, Gauteng 0002
South Africa

American University - Washington College of Law ( email )

International Legal Studies Program
4801 Massachusetts Avenue N.W.
Washington, DC 20016
United States
202-274-4205 (Phone)
202-274-4116 (Fax)

HOME PAGE: http://www.wcl.american.edu/faculty/bradlow/index.

Christopher Strong Humphrey

University of Zurich ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland

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