A new wave of African-led investment is progressively linking infrastructure development with cross-border trade, industrial production and job creation, as entrepreneurs, governments and international partners commit capital to projects designed to strengthen the continent’s economic integration.
In East Africa, Nigerian industrialist Aliko Dangote has partnered with Ethiopia and Djibouti on a $660 million refined petroleum pipeline connecting Damerjog in Djibouti with Dewele in Ethiopia. The 120-kilometre project will include storage and distribution facilities and is intended to improve the movement of petrol, diesel and jet fuel along the Ethiopia-Djibouti trade corridor.
The pipeline is expected to reduce fuel delivery time from Djibouti to Addis Ababa from about five days to one, while lowering dependence on road tankers and associated logistics costs. To a landlocked Ethiopian economy, a more reliable access to imported fuel could also strengthen energy security and reduce exposure to disruptions along international supply routes.
The investment illustrates a greater economic principle that infrastructure can generate value farther than the physical asset itself. A pipeline, port or transport corridor can create demand for logistics, maintenance, storage, manufacturing and other services while improving the efficiency of businesses that depend on it. However, the eventual return on such investments will depend on utilisation, operating efficiency, market demand, financing costs and the successful implementation of supporting infrastructure.
In West Africa, Nigeria is also advancing a major integrated infrastructure and industrial project. The Ogun State Government and DP World have signed agreements covering the proposed Gateway Deep Seaport and a 10,000-hectare Blue Marine Special Economic Zone, with more than $7 billion in initial investment envisaged and more than 50,000 direct jobs, projected at full development.
The cross-border investment story is extending into natural resources. Nigeria and the United States have signed a framework aimed at attracting American investment into Nigeria’s estimated $700 billion mineral-resource base, covering exploration, mineral development and processing, infrastructure and technical capacity. The stated objective includes moving more of the value chain into Nigeria, rather than relying predominantly on exports of unprocessed minerals.
Investment is also reaching sectors away from energy, ports and mining. In Senegal, football star Sadio Mané has launched SM10 Agro, an agro-industrial project in Bambali valued at about 11.7 billion CFA francs. The 500-hectare development is focused on mango production and processing, with more than 1000 direct jobs expected at the start, and a longer-term target of 2500 jobs to evolve.
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