Africa Business News: Entrepreneurs. Investments. Banking & Finance. Emerging Markets. Start-Ups
Sunday, 12 October 2014
57% OF SUB-SAHARAN AFRICA IS STILL WITHOUT POWER
Multilateral Investment Guarantee Agency says 57% of SSA is still without power. PHOTOS: Atomictoasters/Panoramio
Building power infrastructure remains a mammoth task for many of Africa’s leaders, this is according to industry experts.
Africa has also been grappling with regulatory concerns and capital intensive requirements which is the nature of investments.
Experts say these challenges are causing some drawbacks hindering Africa’s power sector.
“At this moment 57 per cent of sub-Saharan African people have not had access to electrification,” Keiko Honda, executive vice president of Multilateral Investment Guarantee Agency (MIGA) told CNBC Africa.
“More importantly the 57 per cent number has not increased much in past several years and this is a huge problem not only to Africa but the rest of the world.”
Honda added that there were so many interesting investment places in power especially in West Africa adding that several people would like to invest in that region’s power sector.
She added that there was however a need to mitigate the risks that come with investments in West Africa. According to the Africa Development Bank, costs of producing power in the continent are way expensive compared to the rest of the world but they could be brought down through regional integration and use of gas to leverage power deficit.
“West Africa has a lot of gas and could link gas supply to the power generation project and this could intensively reduce costs,” added Honda.
Honda said that her organisation has in the past supported gas to power project in countries Ivory Coast and this has helped reduce power costs.
The United States president Barack Obama through his Power Africa initiative has also been working to reduce power deficits in the region.
In his recent US-Africa leadership summit, Obama announced 12 billion US dollars investment towards the project.