Deloitte Africa on Tuesday released its Fourth Annual Africa Construction Trends Report giving an overview of the past three years on infrastructural projects and its financiers in the East African region.
According to the report, East Africa accounted for 20 percent of all the on-going projects in Africa valued at USD 57.5 billion in 2015 compared to USD 60.7 billion in 2014, with Kenya taking the lead with 20 projects out of 61, followed by Ethiopia with 12 projects.
In total, the number of projects in 2014 to 2015 in East Africa rose from 10 to 61, of which the International Development Finance Institutions (DFIs) were the largest financiers of the infrastructure projects overtaking the governments in Africa.
Out of the total 301 projects, DFIs funded 145 in Africa representing 48 percent of the total projects largely in the energy and transport sectors.
Releasing the report at a Nairobi hotel, the Head of Infrastructure and Capital Projects Deloitte East Africa, Mark Smith said the rapid urbanization and influx of an expanding middle class in the year under review drove the need for infrastructural reform, expansion and upgrading.
“The increase of middle class coupled with the promise of high yields also increased investors quest to invest in retail, entertainment and lifestyle facilities in Kenya and Tanzania, resulting in modern office parks and hotel space,” added Smith.
The report also highlighted that the total value of mega projects in the continent stood at USD 357 billion in 2015, a 15 percent increase from 2014.
Smith who singled out Chinese government as one of the biggest financiers in East Africa, said the country has funded 8 percent of the major projects and constructed 21 percent of the projects.
He said during the year under review, transport development dominated the mega infrastructure space in Africa with 111 projects valued at USD 131 billion.
Of the projects funded by International DFIs, 40 were in West Africa, 39 East Africa, 37 Southern Africa, 17 Northern Africa and 12 in Central Africa.
Deloitte Africa is a UK private company.
