Improving Transnational Transport Corridors
In the OIC Member Countries: Concepts and Cases
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implementation of the plan is reviewed, very little had been accomplished. It is suggested that
a major constraint to the ability to raise private funding is the lack of progress towards
regionalization as most projects by definition are cross border, depend on market
liberalization, structural reform, political stability and elimination of economic crime.
Partnership with Private Sector in Infrastructure Development
From recent studies and as determined by the RIDMP, public financing of infrastructure
continues to face challenges owing to fiscal limitations, as well as competing needs from other
urgent socio economic sectors. In order to address this challenge, the RIDMP advocated for the
adoption of joint public and private partnership participation in Regional Infrastructure
development.
A further problem is the perceived political risk to investors of cross border investment and
the lack of harmonization of regulations. In practice, some SADC States have invited the private
sector to partner with governments on investment in infrastructure, either as sole investors or
in the form of PPP. However, the practice has not been wide spread and has met with only
limited success. Since future investment in infrastructure and transport services is largely
contingent on the private sector, innovative ways of presenting or packaging investment need
to be explored.
The RIDMP also recommended that States also need to explore elimination of monopolies and
institutionalize open access options, where the services are more amenable to the private
sector. Despite the global trend in PPP, there are few examples outside South Africa. It is a pity
that given the enormity of the investment proposed, USD 850 Billion, the issue of project
financing was not given greater prominence. Again, It is noted that the whole issue of cross
border investment is not discussed either where an investor is interested in funding
infrastructure that passes through two of more countries. However, the very existence of an
investment plan enables investors to appreciate the bigger picture.
Maintaining Asset Value
One of the key challenges to sustainability and rehabilitation of infrastructure, as observed by
the Diagnostic Analysis of the RIDMP, is the lack of application of cost reflective tariffs for the
usage of infrastructure. This has resulted in limited resources for maintenance, dilapidation of
infrastructure and crucially significant loss in asset value. Clearly the loss of value of strategic
regional assets is not acceptable. Despite the importance of this issue, SADC has not really
addressed it in the Master Plan. SADC needs to draft a protocol that member states maintain
strategically important infrastructure as a matter of priority.
User Pays Principle
The User Pays is a principle that is developed slightly in the SADC Master Plan with regarding
to power supply, but it is not extended to transport. It is crucial that this principle is widely
accepted and that sustainable development is openly discussed between corridor development
partners. Projects advanced through the SADC Master Plan must be both economically and