Build Magazine August 2015

Build Magazine 24 ast Africa is fast becoming a strategic hub for Africa’s growing construc- tion industry. The number of mega construction projects in East Africa (ex- cluding Mozambique) grew by 12% in 2013 alone due to increased investment from international con- struction firms. The surge in interest is in part due to the enormous potential that East Africa presents for investors, specifically around the construction and development of regional infrastructure systems so as to facilitate further economic growth. Infrastructure and support systems in East Africa, comprising all of its 20 countries, has histori- cally been one of the world’s poorest and least developed, sharing only one quarter of the African infrastructure between 44 African countries. Experts estimate the region needs investment of around US$100 billion per year over the next decade for Africa to close the infrastructure gap and catch up with the rest of the world on basic requirements. With local and foreign investors noticing the oppor- tunities, there has been an eagerness to supply the funding for such developments. East Africa record- ed the highest increase in foreign direct investment in 2014 and has now caught the eye of international construction firms looking to enter the African market. A recent KPMG Global Construction Survey found that over 50 per cent of senior leaders in the construction and engineering industry see the continent as one of the most popular prospects for further corporate expansion. In our 35 years of operation in the region, Spencon has witnessed first-hand the surge of interest from foreign firms looking to take advantage of the opportunities in the region. Having partnered with many international companies and development agencies to deliver projects locally, we see the potential the region has in offering lucrative contract opportunities to interna- tional firms. According to The Economist, six of the world’s ten fastest growing economies of the past decade are in sub-Saharan Africa. East Africa in particular continues to show promising year on year economic growth. Beyond 2016, it is also projected to become the continent’s fastest growing region economically. Supporting this growth has created a multitude of opportunities for construction companies with the experience and expertise in delivering infrastructure projects. Rapid urbanisation, a growing middle class and an increasing population size has encouraged many African governments to seek to provide ad- equate infrastructure for their population. It has also presented an ideal opportunity for East African firms cement their place in the global construction marketplace. Foreign investors have noticed the lucrative investment potential of narrowing Africa’s infrastructure gap. The Chinese government, in particular, has been a keen investor in some of the larger infrastructure projects, like the recently started $13.8bn rail project, which will link Kenya’s Indian Ocean port of Mombasa to the capital Nairobi, then on to Uganda. Furthermore, increasing collaboration and strategic regional integration within the region has paved the way for cross-border infrastructure projects. This has opened up oppor- East Africa’s Growth Story: Opportunities for International Construction Firms Andrew Ross, CEO of Spencon Ltd examines how East Africa offers international firms potential opportunities as infrastruc- ture and the economy improve. E