- As South Africa Firm Announces African Expansion And Calls For AfCFTA To Be Catalyst To Build Africa's Water Infrastructure
The United Nations warns that the world could face a 40 percent shortfall in water supply by 2030, with Africa – which already suffers from greater levels of water stress than other regions likely to bear the brunt.
The economic impact of the shortfall in water infrastructure and supply is already severe. Sub-Saharan Africa currently loses an estimated 5 percent of its annual gross domestic product (GDP) due to poor access to clean drinking water and sanitation, 5 to 25 percent of its GDP to droughts and floods in affected countries, and 40 billion hours of otherwise productive time annually, collecting water.
Having delivered on sustainable water supply projects in the SADC region, South African-based construction and engineering firm, Khato Civils, has announced its intention to expand across the continent and play its part in tackling Africa’s infrastructure shortfall.
The African Continental Free Trade Agreement (AfCFTA), the world’s largest free trade area, came into effect in January 2021. It is expected to increase levels of intra-Africa trade by over 50 percent by 2030 and offers the opportunity for increased Pan-African collaboration in major infrastructure.
In an interview with AfricaLive.net, Khato Civils Chairman, Simbi Phiri, put forward an ambitious vision for African development facilitated by infrastructure development. He said "problems like food shortages are not occasioned by lack of food on the continent necessarily, it's about our undeveloped land and waterways. If we can step up infrastructure development, we will solve a lot of other problems as well".
Africa's Water Crisis In Numbers:
As the world becomes more populous, increased urbanization, climate change, and changes in food production are driving water demand at a rate that outpaces supply.
Globally, 60 percent of wastewater goes back into the ecosystem without adequate treatment, resulting in 1.8 billion people worldwide drinking contaminated water.
Over 300 million people in Sub-Saharan Africa lack access to clean drinking water and over 700 million live without access to good sanitation.
The world faces a severe water shortage by 2030, and Africa is likely to bear the brunt – as exacerbated by the impact of climate change.
Africa’s water sector has an annual investment shortfall of USD 13 billion (urban areas) to USD 27 billion (rural areas).
African countries lose between 5 and 25 percent of GDP due to issues related to lack of water infrastructure.
For every one USD invested in water and sanitation, there are direct and indirect economic returns to individuals and households, the health sector, and agricultural and industrial sectors, ranging from USD 3 to 34, according to the World Health Organisation (WHO). Mr. Phiri said: “If you look at big cities like Accra, their biggest issue is water and sanitation. The same applies to other cities like Lagos and Kinshasa with power and roads coming a close second. Water and sanitation is without a doubt the main area that will boom in Africa in the short-term future.”
In order to unleash these economic benefits, however, Khato Civils Chief Executive Officer, Mongezi Mnyani, calls on governments to accelerate infrastructure development and foster public-private partnerships. “Political will is at the center of it all,” says Mr. Mnyani, adding that “Infrastructure initiatives must be government-driven because that’s where the agenda is set and major decisions are made. Governments must work collaboratively and also develop strategies that entice the private sector so that firms like ours have an easier time carrying out projects.”
While poor governance, mismanagement of resources, and a lack of environmental research have exacerbated water supply issues, insufficient long-term investment in water infrastructure needed to manage water resources and provide water services remains a key challenge.
The African Development Bank’s Acting Vice President for Agriculture, Human and Social Development, Ms Wambui Gichuri, recently highlighted an annual investment requirement of USD 35 billion per year. Gichuri also stated that a UN assessment indicates finance gaps of between 39 percent for urban water supply and 78 per cent for rural water supply.
De-risking Africa in the eyes of global capital is key to closing that funding gap. Mr Phiri believes indigenous African construction and engineering firms - previously often overlooked in favour of international firms - have a role to play in building investor confidence, saying “I believe it’s all about getting projects done on time, within budget, and with proper quality. People will trust you more if you have a track record of delivering what’s needed with allocated funds. Risk comes in when we have companies that do not do what’s required of them with borrowed funds. Once we develop professional and social proof based on the work done with borrowed funds, it will boost our credit rating and make it easier for us to access more capital.”
Khato Civils Impact On Infrastructure In South Africa
Khato Civils has been making a mark on water infrastructure across the Southern African Development Community (SADC) region for decades, with Mr Phiri at the helm for about 11 years. “We took over the company in 2010 because we saw a niche area in South Africa,” he says. “Lots of South African companies were either being priced out of deals or running out of budget to complete certain projects. We also wanted to bring a special quality to the market in a way that exceeds what customers want and need.”
Also speaking in an interview with AfricaLive.net, CEO Mongezi Mnyani adds, “We may be based in Johannesburg, but we have offices in Zimbabwe, Botswana, Ghana and South Sudan. We are looking to set up offices in other regions as well because our vision is to diversify into other markets and offer our products to countries that need them the most across the continent.”
With Khato Civils’ ongoing expansion and 85 per cent of their staff based in local sites, the company is poised to expand Sub-Saharan Africa’s water infrastructure and supply, thus improving climate resilience and mitigating food security risks, pending greater investments in water infrastructure. “It’s not just about business for us, we work to ensure we leave a legacy by changing the lives of communities,” says Mr Mnyani.
Botswana's 100km Pipeline Project
The government of Botswana is implementing the North-South Carrier Project to address water shortages in its growing capital, Gaborone.
The Khato Civils/South Zambezi/Evolution Engineering is designing and constructing a Transmission Water Pipeline of approximately 100km from Masama Well fields to Mmamashia Water Treatment Plant in Gaborone, to convey 64Ml/day of borehole water abstracted from both Masama East and West Wellfields. The project started in May 2020 and Khato Civils is rallying to complete what would normally require 2.5 years in half the time, as per the client’s wishes, and despite the COVID-19 pandemic.