GHANA INFRASTRUCTURE Energy, Water & Transport

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Nov 18, 2013 (3 years and 9 months ago)

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GHANA INFRASTRUCTURE

E
nergy, Water & Transport






Magdalene Apenteng

Director

Public Investment
-

MOFEP

1

Presentation outline


Introduction


Infrastructure Gaps


Financing options


Efficiency Gains & Potential Efficiency
gains


Institutional arrangements


sound public
investment management;


Partnerships


Conclusion


2

Introduction


Ghana Shared Growth and Development
Agenda 2010
-
2013 (
GSGDA):


Critical strategy to provide infrastructure
investment


means to promote growth and
diversify economy away from traditional
exploitation of natural resources;


GSGDA


framework for support to social
and economic development
-

transport, roads,
water & sanitation, and power
infrastructure.

3

Infrastructure Gaps
-

Roads


Network
-

66,220 km comprising


42,192 km of feeder roads



12,400 km of urban roads and



11,628 km of trunk roads.


Satisfies current minimal requirements for
regional integration








4

Infrastructure Gaps
-

Roads


Setbacks





poor
connectivity, 41% of network in good
condition, priority given to improving road
quality against expansion;


Traffic density high especially in urban areas,


rapid deterioration;


25% of population living in rural areas live
within 2km of an all season road

5

Infrastructure Gaps
-

Roads


Way forward
:



introduce improved/latest
construction
technology
,



introduce better road maintenance
and
regulation,


d
econgest urban
traffic (in Accra first), and


improve
rural
connectivity through inter
-
connectivity of roads in all three sectors


Highways, urban and feeder roads across
the country.


6

Infrastructure Gaps
-

Railways


Network


currently 1300km


Originally to transport exports


manganese,
bauxite, cocoa etc. and linked in a triangular
form


Accra


Kumasi &
Takoradi
. (
Takoradi



Kumasi partially operational)


Setback

-

Old tracks,
inadequate &
outmoded rolling stocks and other
essential
facilities

7

Infrastructure Gaps
-

Railways


Way forward
:


Rehabilitate
and
modernize
network

-

Western
region to fully tap its enormous
economic potential.


Build a multi modal connection from
Tema

-

Akosombo

part of proposed
Eastern
multimodal corridor and
finally extend line
from Kumasi
to
the North


8

Infrastructure Gaps


Ports


Currently
-

seaports of
Tema

&
Takoradi

-

well equipped to service both local
production and international traders


volumes of activity have increased sharply in
recent years;


Volta Lake transportation system
-

petroleum products, agricultural goods and
passengers


9

Infrastructure Gaps


Ports


Setback
-

Volumes of activity have
increased sharply in recent years at
Tema

&
Takoradi


congestion and capacity constraint serious
impediments to further development.


Volta Lake system


obsolete equipment;
volatile ecological conditions; poor loading
equipment and


Poor connectivity to road network


10

Infrastructure Gaps


Ports


Way forward:


Rehabilitate/retrofit and expand the
Takoradi

and
Tema

ports


Develop
a multimodal transportation
system
including provision of adequate
equipment and infrastructure on
the Volta
Lake.


11

Infrastructure Gaps


Water &
Sanitation


Steady
progress in access to safe water
(
84% of
the
population
-
2008
),



Slow
progress
in
access to sanitation (
14%
percent of the
population


2008)

12

Infrastructure Gaps


Water &
Sanitation


Setbacks



still several challenges
-

rural
and urban households rely on natural
sources of water


Unreliable water supply


Lack of basic
and appropriate sanitation
facilities.




13

Infrastructure Gaps


Water &
Sanitation


Way forward
:


Improved sector coordination


Sector wide investment plans to rehabilitate
and
expand distribution
networks


Develop adequate sanitation
facilities and


Reduce
utilities’ high distribution and other
operational losses.


Water
Sector Strategic Development Plan 2012
-
25 adopted in March 2012,

proposes universal
coverage for water and sanitation services is to be
achieved by 2025.


14

Infrastructure Gaps


Power


Current level is 2,200 MW


Seeks to increase installed
generation
capacity to above 4,000 MW by 2017,
and


Universal
access to electricity by 2020
(from the current 67 percent of the
population).


15

Infrastructure Gaps


Power


Setback




reliable
power supply
;
-

huge impediment
to economic growth


congestion
, and


the
generation mix basically oil and hydro


16

0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
MW
CCGT
Gas Turbine
Wind/Solar
Hydro
17

Ghana Installed Generation Capacity

Infrastructure Gaps


Power


Way forward
:


Increase power generation capacity


Rehabilitate
and
expand
Transmission
network,


Diversify
mode of generation
from
oil and
hydro to
more natural
(wind,
solar, gas)


Thus reduce costs and increase security
of supply.


18

Financing Options


Sources of funding include increased
budgetary resources, concessional and non
concessional borrowing, and public private
partnerships.


Budgetary resources and concessional
funding


for high social return
infrastructure projects;


Non concessional and private
funding
for
high return commercial infrastructure
projects.


19

Financing Options


Beyond GSGDA to 2017, identified
infrastructure projects amount to
US$13,996m (inclusive of US$2,175m for
2012
-
13);


Strategy


continue relying on a mix of
financial resources ( public, development
partners & private sectors)

20

Infrastructure investment plan

2012
-
2017 (
US$million
)


Generation (power)


1,980


Transmission
(power)

903


Distribution
(power)

1,000


Roads 5,497


Ports 674


Rails 2,832


Water & Sanitation 1,110


Total


13,996

21

Efficiency Gains


Need to improve social and economic
returns from infrastructure projects;


NIP expected to match investments with
economic and social returns
-

(a geographic
information system database tool will assist
in this regards)


E.g.


Integrated Transport Plan


development of north
-
south corridors
including 3 road corridors


western, central
and eastern, one rail corridor

western, 2
multi
-
modal corridors (east rail
-
lake
-
road
and west
-
rail
-
road

22

Efficiency Gains


Potential synergies and complementarities
from different projects will be reviewed in
the NIP;


Focus attention on road, transport and
water resources and other social and
economic infrastructure
-

e.g. opening

up of
markets, connecting natural resources and
production locations to national and regional
markets;

23

Efficiency Gains


Better management of utilities through:


Good governance structures,


Regulation;


Monitoring;


Discipline in maintenance of assets to
eliminate inefficiencies estimated at
about US$968m annually (under
pricing of US$729m)

24

Potential
E
fficiency
G
ains


Closer alignment of fees and tariffs to
costs;


Improve targeting efficiency of
subsidies
-

(progressive tariff structures,
rural electrification);


Better financial management and
improved balance sheets will increase
ability to become financially viable
companies

25

Potential Efficiency Gains


Use private financing through PPPs and thus
reduce impact of investment financing on
Government balance sheet and debt ;


Efforts to reduce distribution losses and
under
-
collection of revenue through
improved networks maintenance and legal
enforcement.


Improvement of the regulatory capacity
(especially with the advent of PPPs).

26

Institutional arrangements for
Sound Public Investment


Rational


Deliver Ghana’s strategic
investment plans


through:


improved revenue mobilization,


sound planning,


formulation,


allocation and supervision (operation
and maintenance) of projects;

27

Institutional arrangements for
Sound Public Investment


Commitment by
government:



Includes the
creation of the
Contract database


led to the
reduction of arrears in
2011;


Strengthen
quality control of project
preparation, appraisal, selection and
implementation




28

Institutional arrangements for
Sound Public Investment


Provide central
guidance and
independent
review

of projects;


Develop a full project database
and asset registry, and


Institute Project management
and monitoring


29

Institutional arrangements for
Sound Public Investment


Streamline
the
monitoring, production
of completion reports and ex
-
post
evaluations of projects.


O
ngoing
development of a 3
-
year rolling
Public Investment Plan (PIP
),


Adoption
by Cabinet of the Public
Private Partnership policy


30

Institutional arrangements for
Sound Public Investment


Creation of the Public Investment Division
within MOFEP to oversee activities for public
investment;


Complementary and coordinating activities
with NDPC in monitoring of public
investment activities;


However several constraints for both offices
such as staffing, office space, logistics and
financing support need to be resolved
urgently.

31

Partnerships


Strategic partnerships with private sector
-

to ensure more rapid, efficient and
satisfactory implementation of
infrastructure plans;


To mobilize and complement financing and
expertise that markets in Ghana or abroad
will not provide


Non
-
concessional financing will be mostly
used to finance commercially viable
projects.

32

Conclusion


Ghana’s investment needs are very diverse,
critical and urgently needed.


Current efforts including


adequate and reliable financing,


good governance structures,


an effective regulatory regime together


with effective and reliable partnerships are
most needed for the expected impact on the
economic and social development of the
country.

33

34

Thank
You