Africa’s infrastructure paradox requires a new investment model

The paradox of Africa’s infrastructure is multifaceted. It needs more than $68 to $108 billion annually for infrastructure financing, currently has approximately 130 transnational projects, yet only six percent are under construction.

For a continent sorely in need of infrastructure, shouldn’t leaders jump at every opportunity to build infrastructure to improve the lives of millions of people on the continent? Especially when Africa’s infrastructure delivery gap is costing it more than “$500 billion in GDP, 74 million jobs, and sadly, one million lives, annually.

Yet Africa’s challenge is not simply raising more financing. It is turning financing into infrastructure in an efficient manner. Only 6% of the continent’s roughly 130 transnational energy, transport, digital, and water projects are currently under construction. By comparison, in industrial construction pipelines tracked on the same pre-execution/execution basis, 54.9% of North America’s projects (the US accounts for $941.3 billion of the region’s $1.1 trillion pipeline) and 61.2% of North-East Asia’s projects (China alone accounts for $665.7 billion) have already reached pre-execution or execution stage, according to data from the Global Industrial Construction Project Insights Report.

I have written about Africa’s infrastructure before to highlight the need to pair Africa’s infrastructure investments with investments in innovation ecosystems. In the piece, I explained that, “the emphasis on building Africa’s infrastructure needs to be paired with the development of innovation ecosystems that can create value which will ultimately be stored in or distributed via the continent’s infrastructure. Marrying infrastructural investments with the building of innovation ecosystems could yield even more substantial and sustainable long-term economic and social benefits, which in turn enable increasing investment in infrastructure.”

A recent announcement by MTN, Africa’s largest telecommunications operator, to share African digital infrastructure costs with Vodacom, Airtel Africa, Orange, Axian Telecom, and Ethio Telecom reinforced a different lesson: infrastructure is more likely to be built when the companies that depend on it have both the incentive and the ability to invest in it together. 

MTN and the other members of the consortium all depend on reliable digital infrastructure to sell communications services to households and businesses. Because they directly benefit from better infrastructure, they have a powerful incentive to build it. And because infrastructure is expensive, they also have a strong incentive to share its cost.

Take MTN for instance. In 2025, the company grossed close to $13 billion, with profits of almost $3 billion. MTN also spends roughly $2 billion in capital expenditures annually, and still industry estimates and the World Bank place Africa’s digital infrastructure gap at $100 billion. In addition, “700 million Africans live within range of a mobile network but cannot afford to get online.” 

Mobile telecommunications represents one of the most successful infrastructure investments and diffusions in Africa over the past 25 years. Today, millions of people have access, hundreds of companies are profiting richly, many jobs have been created, and billions of dollars in investments are happening annually. Yet the access gap of one of the most successfully diffused innovations remains colossal and demands collaboration and coordination from some of the largest companies on the continent. 

That is precisely why the MTN consortium matters. If even one of Africa’s greatest infrastructure success stories still requires competitors to collaborate in building shared infrastructure, it is hard to imagine sectors such as electricity, transportation, healthcare, or water succeeding without similar models of coordination. 

The MTN model offers a simple three-part framework that can be applied across sectors.

First, identify the foundational infrastructure needed for companies in the sector to more efficiently deliver their products and services to consumers. Second, create a consortium where companies can invest to build this infrastructure and jointly own it. This way, they are incentivized to use the services of the newly set up infrastructure company. Third, the consortium prioritizes collaboration on infrastructure while each company competes vigorously on services to consumers. 

The third principle is perhaps the most important. Collaboration should end at the infrastructure layer while competition should begin at the services layer. Open-access rules and strong regulation are essential to prevent infrastructure sharing from becoming market consolidation.  

“Think tanks such as Cape Town-based Research ICT Africa champion infrastructure sharing to lower market entry barriers, but warn that it must be coupled with strict open access mandates. Without them, industry bodies like the Internet Service Providers’ Association, a trade body, fear consolidation simply creates a closed cartel that permanently locks smaller operators out,” as reported in Semafor.

Africa has spent decades trying to solve its infrastructure challenge largely the same way: with governments and development finance institutions leading the charge, project by project. Yet the results suggest that more of the same is unlikely to close the continent’s infrastructure financing gap. The MTN consortium points to a different model where the companies that depend on infrastructure have both the incentive and the responsibility to build it together. Solving Africa’s infrastructure paradox will require not just more capital, but new ways of organizing it. Sometimes the biggest breakthrough is not raising more money, it is redesigning the institutions that can transform capital into infrastructure.