African infrastructure financing is facing a crisis. Financing levels have plunged from $100 billion a year in 2014 to just $31 billion last year, according to a new report published by the international law firm Baker McKenzie.
This is a massive setback for the continent that’s been working hard to fill a gaping infrastructure deficit the AfDB conservatively estimates is valued somewhere around a trillion dollars over ten years. And the situation has been made worse by the dramatic pullback in overseas development financing from China’s two largest policy banks that have been the dominant funders of African infrastructure over the past 5-6 years.
Wildu du Plessis, head of Baker McKenzie’s Global Africa Practice and a co-author of the report, joins Eric & Cobus to discuss the current state of African infrastructure financing and why, despite the current challenges, he nonetheless remains optimistic about the future.
- Baker McKenzie: New Dynamics: Shifting Patterns in Africa’s Infrastructure Funding
- Deloitte: Africa Construction Trends Report 2020
- McKinsey & Company: Solving Africa’s infrastructure paradox by Kannan Lakmeeharan, Qaizer Manji, Ronald Nyairo, and Harald Poeltner
Wildu du Plessis is the head of Baker McKenzie’s Global Africa Practice. He is based in the Johannesburg office and also leads the office’s banking and finance and restructuring and insolvency practices. Mr. du Plessis is regularly ranked as one of South Africa’s leading lawyers and has been recognized by Chambers Global and the Legal 500 as such for a number of years. Mr. du Plessis represents and advises leading domestic and international financial institutions, private equity groups, and corporates in connection with a wide range of financing transactions, acquisitions, restructurings, regulatory and general finance matters. He has advised on many of the most high profile first-to-market transactions in South Africa including the first synthetic securitization; the first asset backed conduit to be established; the first overnight call bond fund to be set up and the first high yield debt to be issued by a South African issuer. Mr. du Plessis also has extensive experience in project finance and has advised on both debt and equity capital market transactions across Africa.
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