Finance institution the African Development Bank (AfDB) Group says it has taken a crucial step to further address the infrastructure gap in African countries, with the approval of its first strategic framework for the development of public-private partnerships (PPPs).

This follows approval by the board of directors of the banking group on January 19.

Africa’s infrastructure investment gap is estimated at more than $100-billion a year. Bank experts say PPPs offer an additional approach to increase private sector investments and higher levels of efficiency in the development and operation of infrastructure assets in Africa.

AfDB president Akinwumi Adesina says the new framework will form the bedrock of the bank’s engagements in the infrastructure sector.

PPPs are already a key feature of infrastructure projects being supported by the bank, among them several transport and energy sector projects in all the regions of the continent.

To achieve its development ambitions, the bank’s Public-Private Partnership Strategic Framework is rooted in three pillars that will provide an end-to-end solution to member countries, from upstream to downstream.

Pillar one covers upstream support, more specifically to ensure an enabling environment and capacity in member countries. Pillar two will provide midstream support, in particular project preparation and transaction advisory services to help structure projects to achieve financial closure. The final pillar entails downstream support to finance the implementation of investment projects.

To aid pillars one and two, the bank will establish a dedicated special instrument, to be known as the Africa Public-Private Partnership Development Fund.

The strategic framework streamlines group-wide PPP efforts across various departments and provides guidance on financial instruments and resources.

It recommends a selective approach to operations and markets, based on the bank’s comparative advantage in Africa’s infrastructure sector, its convening power on the continent and the level of maturity of the different markets respectively.

The Bank’s Private Sector, Infrastructure and Industrialisation Complex will coordinate the implementation of the framework over a ten-year period, starting this year.

In rolling out the strategic framework, the bank will engage clients and partners and begin dialogue with member countries to identify priority areas.