Diplomatist Magazine Africa Day Special 2018 | Page 37

ANNIVERSARY SPECIAL
POWERING
AFRICA
T
he opportunities and challenges present in
the African power sector are unparalleled by
those present in any other part of the world.
There are potential game-changers in this segment,
but it is imperative to get a sense of the extent of
the issues involved.
African economies have experienced robust
economic development in the last few years,
outperforming other regions in this regard. In order
to ensure the sustainability of this development,
African governments need to prioritise the
establishment of reliable and affordable electricity
infrastructure which is a prerequisite for economic
development and poverty reduction.
The power sector in Africa presents a lot of
opportunities, with governments in the region
having recently opened up their domestic sectors for
private participation which is attracting companies
from across the globe.
Present Scenario
In the last decade, the African continent has
shown remarkable progress in terms of electricity
generation. In 2005, only 36.5 percent of the
Swaziland population had access to electricity;
presently, this fi gure has increased to 70 percent.
Similarly, other African countries have also shown
remarkable improvement, with Ghana, Cabo Verde
and Comoros having increased electricity access
to its population from 54.9 percent, 67 percent,
and 51.6 percent to 80 percent, 93 percent, and 75
percent, respectively, over the last decade.
Improved access to electricity has been made
possible due to an increase in the region's electricity
production, with countries like South Africa, Egypt,
Algeria, Libya, Nigeria, Morocco and Tunisia
emerging as leading producers in this fi eld. South
Africa is the largest generator of e lectricity in Africa
with a share of 32.7 percent of the total electricity
output in the region, followed by Egypt (22.5
percent), Algeria (8.4 percent), Libya (4.9 percent),
Nigeria (4 percent), Morocco (3.8 percent), and
Tunisia (2.5 percent).
On the other hand, some of the major consumers
of electricity include South Africa (34.5 percent
of Africa’s total consumption in 2014), Egypt
(23.3 percent), Algeria (8 percent), Morocco (4.7
percent), Nigeria (3.9 percent), and Tunisia (2.4
percent).
Opportunity for India
By 2040, it is expected that Africa will
need a power supply of 3,100 terawatt-hours to
meet the demands of its growing population. A
surge in power demand in the future opens vast
opportunities for foreign investment, with Indian
companies expected to become major players in
the sector.
Presently, Indian companies have been playing
a key role in the power sector in African countries,
with Indian joint ventures in South Africa,
Mauritius, Ghana, and Sudan. Apart from the joint
ventures, the EXIM Bank has played a key role
in developing the power sector in Africa through
fi nancing of various projects which include loans,
guarantees and equity fi nance.
India is a member of the African Development
Bank (AfDB) Group. Many Indian companies
participate in projects funded by the AfDB Group.
As Indian companies have earned reliability over
a period of time, it is highly likely that Indian
companies will have a major role to play in the
near future to make Africa self-reliant in the fi eld
of power generation, with companies such as
Jindal Africa becoming an established name in
the continent.
Encouraging Indian companies to take power
projects in Africa, AfDB President Akinwumi
2018 • Africa Day Special • 33