Deepening African Capital Markets for Infrastructure Finance

Africa’s infrastructure needs are huge and it is essential to meet for sustainable economic growth across the continent. Investment in infrastructure plays a fundamental role in almost all aspects of an economy. The capital needed to finance the infrastructure exceeds the financial resources of governments, donors or other funding source individually. Meeting this challenge requires to mobilize new sources of capital to fill a gap that threatens to undermine economic development efforts underway in Africa. This article attempts to analyze how the domestic capital markets can help to finance most of the major infrastructure projects in Africa, and thus help bridge the funding gap. It highlights the opportunities available for infrastructure project bonds ; then elaborates on the conditions for efficient capital markets. Finally, it explains the crucial role of constructive government policies to deepen capital markets and structure infrastructure finance in Africa.