AUDA-NEPAD Report Seeks to Bridge Africa’s $170 Billion Infrastructure Financing Gap

A new report by the African Union Development Agency (AUDA-NEPAD), Africa-Europe Foundation, and the African Climate Foundation titled: “The Missing Connection: Unlocking Sustainable Infrastructure Financing in Africa” proffers a way out of Africa’s $170 billion annual infrastructure deficit.

Launched at the 5th Finance in Common Summit (FiCS), the global summit of public development banks, held February 26-28 2025 in Cape Town, South Africa, the report lays out crucial gaps and opportunities to unlock more and better finance for infrastructure development in Africa.

A press statement by AUDA-NEPAD and its partners says Africa’s infrastructure financing gap, estimated at $130-170 billion annually, is holding back the continent’s economic growth. Even as African governments contribute approximately 40% of the current $80 billion annual investment, a significant funding gap remains. 

“This gap is costing Africa a 2% annual reduction in its GDP growth. Adopting innovative financing solutions through domestic resource mobilization and governance reforms is therefore critical for governments balancing competing budget lines,” said the statement.

Nardos Bekele-Thomas, CEO of the African Union Development Agency (AUDA-NEPAD) was quoted saying infrastructure development cannot succeed when sectors operate in isolation.

“Energy, transport, water, and digitalization must function as parts of a larger whole, to create synergies that drive sustainability and long-term impact. Coordinating efforts across these interconnected sectors ensures that every road, bridge, or power plant becomes a vital link in a broader network that uplifts communities and fuels economic growth,” said the AUDA-NEPAD CEO.

Likewise, Paul Walton, Executive Director of the Africa-Europe Foundation believes unlocking untapped areas of cross-continental action was in the DNA of his Foundation’s joint work with AUDA-NEPAD and the African Climate Foundation.

“At a time when the world needs the Africa-Europe Partnership to step up, our report focuses on concrete actions and processes that will unlock more money and smarter money to address the critical challenges faced by our societies,” said Walton.

Also, Saliem Fakir, Executive Director of the African Climate Foundation, says his Foundation leverages its country-level investment platforms to transform key economic sectors in Africa, primarily focusing on opportunities that can unlock much-needed investment.

The newly launched report’s priority areas of action include: Leveraging the G20 for domestic resource mobilization through South Africa’s G20 Presidency – which coincides with the defining Financing for Development Conference –  as key to stepping up the level of ambition on internal revenue mobilization.

Other priority areas are reinforcing the Africa-Europe Partnership to unlock $2.3 trillion in investment, pension and sovereign wealth funds currently locked up overseas; Embracing digital and AI industry-wide to drive transformation; Prioritizing infrastructure investments at the energy-climate-health nexus; as well as Standardizing infrastructure-investment data collection for an industry-wide reporting standard.

AUDA-NEPAD and its partners believe only these initiatives (collectively) in addition to reforms could generate more than enough resources to meet Africa’s infrastructure investment gap.

“However, they require sustained governance improvements, financial transparency, and long-term equitable international collaboration. In a changing geopolitical context where development aid is contested and purse strings are tightening, it is crucial to improve the quality and efficiency of existing investments and projects,” according to the statement.

Launched in association with South Africa’s Presidency of the G20, The Missing Connection: Unlocking Sustainable Infrastructure Financing in Africa report is designed as an operational blueprint for African and European public development banks and regional institutions to unlock needed finance without further exacerbating the African continent’s debt crisis.

You can download the report here