Public-private partnerships (PPPs) might have the potential to solve some of Africa’s considerable infrastructure backlogs, but should not be seen as a silver bullet, advisory firm KPMG said on Wednesday.

Speaking at the Railways and Harbours conference in Johannesburg KPMG infrastructure and projects in Africa director Johan Greyling said that the continent was only spending about half of what was required to bridge the infrastructure backlog, at around $45-billion a year, when it really should be spending about $95-billion a year.

On average, an African country needed to spend about 25% of its gross domestic product (GDP) on infrastructure, but is currently only spending about 15%. With Africa’s population set to double in the next 25 years, the infrastructure problem would keep growing.

Greyling said that Africa’s biggest infrastructure investment challenge was its inability to attract large-scale foreign investment and secure stable and reliable funds, even though the continent had been doing much better in recent years.

He noted that PPPs could assist governments to close the funding gap, but added that many African countries still did not have the desired framework to successfully execute such projects. “The fact that a reform in Africa’s regulatory process is only halfway along forms part of this problem.”

South Africa had been one of the most successful at implementing PPPs on the continent, completing 50 national, and 300 municipal projects in recent years. The country has set up a conducive regulatory system to execute such projects, but Greyling warned that a PPP model was not suitable for every project.

Greyling said the reasons why the PPP model was not always as successful in other African countries usually related to policy issues, as well as the fact that big government contracts were complex, demanding, time consuming and prone to abuse by unscrupulous individuals, firms or politicians, unless controlled by disciplined and highly transparent procedures.

However, he added that under the right conditions, PPPs could offer significant benefits to African governments, business and consumers.