Table 1.4: Industry Opportunity Groups Projected to Reach USD 2.6 Trillion in Africa
Industry Groups Consumer (goods, telecoms, banking etc.)
Estimated Annual Revenue in 2020 (in USD Billions)
Growth Between 2008 and 2020 (in USD Billions)
Compound Annual Growth Rate Between 2008 and 2020 (Per Cent)
1 380
520
4
Resources
540
110
2
Agriculture
500
220
5
Infrastructure Total
200
130
9
2 620
~980
4
Source: McKinsey Global Institute.120
required to meet power, water and transportation needs is around USD 46 billion per annum,126 and power is the greatest challenge.127 Infrastructure investments represent a significant area of future development in African cities, precisely because many of them lack basic infrastructure or, where they exist, are struggling to keep up with demand. How these investments are made would determine how multiscale and multilevel the economic activities that proceed from these large investments will ultimately become. The cities that adopt new spatial planning trajectories that depend on particular infrastructure choices will lock themselves into patterns of growth. This is especially the case where centralized bulk infrastructure offerings are compared with semi-decentralized and decentralized infrastructure and technology offerings. Different solutions may fit different local contexts more appropriately, but in the African urban context decentralized and semi-decentralized offerings have significantly more traction, precisely because they are able to operate independently of large centralized infrastructures, which city and national governments generally struggle to maintain due to lack of finances and skills.
Developing and Financing Paths to Green Growth A green economy may be defined as one that “results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities”.132 Any green development strategies undertaken in African cities must primarily recognize that development is a key priority for the urban citizenry, the majority of whom
THE STATE OF AFRICAN CITIES 2014
Regional Linkages and Investment Flows Investment flows into Africa are often intimately tied to former colonial relations, but intra-African city linkages can also be important. Mogadishu, for example, is heavily dependent on the decisions made by Somali traders in Nairobi. The mayor of Mogadishu has complained that Nairobi exerts too much control over his city, referring to the Somalis who have settled in Nairobi to escape war in their country. Regionalism is vital to introducing change in Africa and developing new linkages among its cities as well as with global markets and emerging world economic powers. Motorists in landlocked Johannesburg, for instance, take just four hours to drive to the Mozambican port city of Maputo. This regional linkage between South Africa and Mozambique, once dictated only by a shared river catchment and water supply, has expanded into a transboundary trade region. Since the closest South African harbour town to Johannesburg is eThekwini Municipality (Durban), a six-hour drive, Maputo is likely to
attract port business from Johannesburg provided Maputo’s capacity and support for trade, industry and port activity improves. In the near future, it is conceivable that tourism between Johannesburg and Maputo might be restored to, or even surpass, its former level. Through mobile phone use, Internet connectivity has increased.128 The mobile revolution has played a role in governing urban slums such as Kibera (Nairobi)129 and may eventually spread to a range of other sectors including health, agriculture, energy and education. Identified trends, which are predicted to fuel new business growth, include geolocation and mobile money; for example, money transfers and microcredit schemes. These allow for better monitoring and securitization of assets at lower data costs and improved reliability.130 The growth of Africa’s energy sector is a prerequisite for sustained expansion in all others. Large energy projects have included the development of the Inga hydroelectric dam on the Congo River; the Desertec consortium-led establishment of 100 large concentrated solar power plants in the Sahara; wind farms in South Africa, Namibia and the Rift Valley; and the continued development of the fossil fuel sectors in Central and Western Africa, and the Republic of South Africa. Investment in renewable energies and green technologies globally has surpassed all other conventional and emerging technology sectors (see also Chapter 1.1). The green technology revolution is likely to be the next global industrial transition.131 Africa and Asia constitute the largest clients for these new services, as demand for energy- and resourceefficient technologies will be huge in their rapidly growing and expanding cities. Yet the question of whether all new technologies can successfully take root in developing African cities remains open since affordability and appropriateness have not been adequately assessed.
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