Wednesday, 3 July 2013

AfDB pledges Sh257b for Obama’s bid to light up Africa

The African Development Bank (AfDB) will expand its work in reforming the energy sector as part of its support for US President Barack Obama’s Power Africa initiative.

Already a major investor in the energy sector, the AfDB will scale up funding for energy production, transmission and distribution infrastructure, cross-border power pools, as well as government policy and regulatory reforms.

The bank will particularly emphasise reforms for national power utilities, many of which are in need of better business models and financial reinforcement.

“We expect to allocate as much as $3 billion (Sh257.3 billion) over the next five years. This will leverage at least four times more investments in the energy sector. Our interventions will include investment loans, reforms, advisory and guarantees,” AfDB President Donald Kaberuka said in Dar es Salaam, in reference to Tanzania, Kenya, Ethiopia, Ghana, Liberia, and Nigeria — the Power Africa priority countries.

“Reforms are the key,” Kaberuka said. “The billions of dollars available for investment in the energy sector will translate into actual bulbs in people’s homes and electricity necessary to grow small businesses if state utilities run efficiently and effectively. The policy reforms will facilitate and enhance cross-border energy markets.”

The main financial source for the bank’s assistance to the energy sector in the Power Africa countries is the African Development Fund (ADF), which is its concessional window.

Addressing CEOs in Tanzania on Monday, Obama said that he saw Africa as the next major success story and he wanted the US to be part of that success through Power Africa.

“So that’s why, yesterday, I announced Power Africa — our initiative to double access to electricity in sub-Saharan Africa. I want to thank the African Development Bank for its partnership, as well as many companies that have stepped up with commitments.”

Source: Standard Digital

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