Big steps with “small” investments

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East Africa, like the other African regions, is only at the beginning of industrialization. It is one of the poorest regions in the world. The productivity of the people and the efficiency Afrika fonds investieren of the company is comparatively low. Measured by western standards, the infrastructure is in need of improvement. In almost all economic sectors and in public administration, potential for improvement quickly becomes apparent. At this stage of development, large increases in efficiency can be achieved even with “small” investments.

A good example is the new Grand Ethiopian Renaissance dam . The connected hydropower plant is the largest in Africa and will reliably supply not only Ethiopia, but also other countries in East Africa with electricity. It will reduce the electricity costs or, in part, make electricity supply possible in the first place. A dam comparable to the Ethiopian project is the construction of the Julius Nyerere hydropower plant in Tanzania, which will become the fourth largest hydropower plant in Africa.

Rwanda is land-locked, which means that it does not have its own seaport. The only options for importing and exporting goods are (expensive) air and country roads. However, the road network is of poor quality – transport times and costs are high. The completion of the railway line between the Tanzanian city of Isaka and the Rwandan capital Kigali will lead to a high increase in efficiency. In particular, Rwanda has a fast and inexpensive connection to the port of Dar es Salaam, which increases its international competitiveness considerably.

A Rwandan logistics center built in 2018 is also a good example of increasing efficiency through “small” investments. The logistics center in Kigali has reduced the average turnaround time from 10-14 days to 3 days. There are many other examples. They make it clear that there is enormous potential for added value that results from comparatively low investments. East Africa is making great leaps forward.

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