Infrastructure and Economic Performance in sub-Saharan Africa

This study examined the impact of infrastructure on economic performance in SSA. By way of a departure from previous study, infrastructure was examined in aggregate and disaggregated terms (transport infrastructure, information communication technology infrastructure and water and sanitation infrastructure) for 39 sub-Saharan African countries. Also, to determine the influence/role of institutional quality (governance index) on the impact infrastructure has on economic performance, governance index was interacted with infrastructure index. The result from the system-Generalized Method of Moments estimation technique showed that infrastructure index (excluding electricity infrastructure), exerted a direct positive impact on economic performance. The negative impact of electricity infrastructure was rationalized on the basis of poor state of electricity infrastructure in most sub-Saharan African countries. The estimate from the interactive terms showed that variables (with the exclusion of information communication technology infrastructure) positively and significantly impacted on economic performance. This shows that governance index influences infrastructure and by extension economic performance in sub-Saharan African countries. In the light of the findings it was recommended that policy makers in sub-Saharan African countries should improve on existing infrastructure in the drive for sustainable economic performance.