Wednesday, June 12, 2024
BusinessAfrica eyes continental energy, ICT markets

Africa eyes continental energy, ICT markets

The African Union Commission (AUC) is working on the establishment of continental energy and ICT markets in Africa.  

This was disclosed at the second Program for Infrastructure Development in Africa (PIDA) policy dialogue conference that was held from September 24-26 in Malabo, Equatorial Guinea. At a high-level panel discussion on continental frameworks for PIDA-II program Cheikh Bedda, Director of Infrastructure and Energy, disclosed that the AUC is planning to launch a continental energy market in ten years’ time. Bedda noted that the continental energy market would benefit all member states. “We all should collaborate to establish the continental energy market,” he said. He also noted that PIDA is working on fair investment projects on renewable energy.

Delegates have deliberated on the draft regulatory framework of electricity market in Africa. The African energy market aims at interconnecting African states through electric power transmission lines. It creates the platform by which member states that can generate surplus electric power can supply power to countries which have energy deficiencies. 

According to the African Development Bank (AfDB), Sub-Saharan Africa currently has 14 percent of the world’s population and accounts for four percent of global energy investment. In Africa more than 600 million people do not have access to electricity. Analysts at the AfDB note that several countries, including Ethiopia, Gabon, Ghana and Kenya, are on track to reaching universal electricity access by 2030.

Robert Lisinga, Chief Energy, Infrastructure and Services Section at UNECA, pointed out that countries can come up with bankable energy projects if they exert some effort on it. Lisinga stated that high voltage power transmission lines could be a bankable project. “If the power transmission line is going to an industrial park believe me it would be a bankable project. The AfDB would finance it,” he said.

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Delegates expressed concern on the high electric power tariff rate that countries charge. They also proposed that countries should focus on the development of renewable energy resources.  

The panel deliberated on Policy and Regulation Initiative for Digital Africa (PRIDA). PRIDA is an ICT development program launched in 2018 in partnership with the European Union. The program aims at accelerating digitalization in Africa.

The draft digital transformation strategy was highlighted during the panel discussion. The PRIDA team noted that the digitalization strategy which is going to be implemented from 2020-2030 is home grown, transformative and comprehensive. The program aims at building a digital market in Africa by 2030.  Digital infrastructure, human resource development and the appointment of digital champion states were highlighted in the draft digital strategy.

One of the topics addressed during the lively session was the need to unlocking Africa’s renewable energy potential. The panelists stressed the need to create access to renewable energy in rural and remote areas. The panelists stressed that no community should be left behind in the implementation of PIDA-II. Major renewable energy development projects in Kenya, Ethiopia and Morocco were highlighted. It was noted that in addition to implementing renewable energy projects Morocco is developing the required technology.             

The panel also deliberated on intergovernmental agreement on Trans African Highway Network (TAH). The road transport network was conceived in the 1970s but the program was initiated in 2011 in Lusaka, Zambia and endorsed by the AU Heads of States in 2014 in Malabo, Equatorial Guinea.

When the program was drafted the road network was outlined to be 54,000 km. But that was reviewed and increased to 57,000 km. It was reported that the ratification of the TAH by member states has been a challenge. One of the reasons given by states is that some cities were not incorporated in the road network development program.  

At the end of the presentations, delegates pointed out that due attention should be given to water resources and rail transport in drafting PIDA-II.      

 With the view of addressing Africa’s infrastructure challenges, the AUC launched PIDA in 2012. PIDA is a continental infrastructure development initiative formulated by the AUC in collaboration with its partners the UNECA, NEPAD and the AfDB.

PIDA is a program dedicated to facilitating continental integration through improved regional infrastructure in the areas of transport, energy, transboundary water and ICT. PIDA was approved by the AU assembly during the 18th ordinary session of the AU in Addis Ababa, which was held from January 29-30, 2012.

The PIDA Priority Action Plan (PIDA-PAP) which extends to 2020 comprises 51 programs and projects divided into 433 projects covering transport, energy, ICT and transboundary water sectors.       

When PIDA was adopted in 2012, the program was designed in three phases – first phase from 2012-2020, second phase from 2021-2030, and third phase from 2031-2040. The total capital investment required to execute the infrastructure development program is estimated at 360 billion dollars. The first phase alone needs 68 billion dollars.

As the first phase terminates next year PIDA-II program is being drafted by the AUC Infrastructure and Energy Commission. 

Since its inception in 2012, PIDA has contributed to the development of 16,066km of road network, 4,077km of railway, and 3,506km electric power transmission line. In the ICT sector, 17 countries were connected with regional fiber optic cables.

The financing gap in Africa for infrastructure development is estimated at between USD 130-170 billion per year.

Despite encouraging investments on infrastructure, both at the domestic and international levels, which averages about USD 75 billion per year, there is a need for significant increase in infrastructure investments on the continent.             

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