Page 6 - AfrElec Week 28

AfrElec INVESTMENT AfrElec
AfDB makes pitch for Africa50
AFRICA
AFRICAN Development Bank (AfDB) chair- man Akinwumi Adesina has urged private investors to plough more cash into key African infrastructure projects in order to connect Afri- can countries and drive economic growth.
He highlighted the need to create energy, road,rail,ports,airportsandICTbackbonepro- jects that would attract more private investment.
“ is is the time to accelerate investments in the preparation of bankable projects,” Ades- ina told a meeting in Kigali of the AfDB-backed Africa50 fund, which aims to raise $1bn of pri- vate and public finance to develop key infra- structure across Africa.
“Africa50 has a solid pipeline of 12 infra- structure projects ranging from roads, railways, power and power transmission lines, as well as ports and communication cable lines, among others,” Adesina added.
“When it comes to infrastructure nancing, Africa is still doing catch-up with the rest of the world. e issue is not nance but, rather, bank- able projects,” said Africa50 CEO Alain Ebobissé.
He said that in the three years since it was founded, Africa50 had become a major player in the continent’s infrastructure-delivery space.
Ebobissé said that Africa50 would
concentrate on pushing projects forwards and avoiding delays, something he said was putting o potential investors in attractive projects.
“A game-changer in the infrastructure space in Africa will occur when enough decision-mak- ers acknowledge that the opportunity cost of delayedprojectimplementationishigh,”hesaid.
Africa50 has already supported four opera- tional utility-scale projects across Africa. ese include: the dual-fuel 120-MW Malicounda thermal power plant (TPP) in Senegal; the 100- MW Scatec Nigeria solar plant; the 420-MW Nachtigal hydropower plant (HPP) in Came- roon and 420 MW of the Benban solar complex in Egypt.
Other major projects include a bridge from the Democratic Republic of Congo and the Republic of Congo, a US$550mn project being led by Africa50 in partnership with the AfDB.
Africa50 is backed by 28 African countries, with Zimbabwe joining in early July, as well as the AfDB, the Central Bank of West African States (BCEAO) and Bank Al-Maghrib.
Africa50 is set to launch a new private sec- tor third-party fund that will be used to lever- age $1bn into infrastructure from private sector institutional investors.™
POLICY
Egypt arrears behind schedule
EGYPT
EGYPT has reduced the amount it owes to oil and gas companies to $900mn, Egyptian Petro- leum Minister Tarek el-Molla told Reuters last week. is is a reduction from $1.2bn a year ago. “We will settle [the remainder] soon, God will- ing,” he was quoted as saying, although he did not provide a rm date.
In January, Cairo told the IMF that it intended to pay o the debt by the end of June. Previously, the government had said it intended to settle the arrears by the end of 2019, which appears to be a more likely timetable.
Under a programme agreed with the IMF, Egypt is reducing the amount of nancial sup- port it gives to its citizens. Fuel subsidies were cut at the beginning of the month, with gasoline prices consequently rising by around 19%, and diesel by 23%. In addition, taxes have increased over the last couple of years through the intro- duction of VAT and a devaluation of the Egyp- tian pound.
The IMF has welcomed these moves. It described reform of fuel subsidies as a “sig- nificant accomplishment”, noting that this would provide space for more targeted reforms intended to help the country’s poorest. A
statement from the Washington-based institu- tion in May said the government’s social pro- tection package was “critical in garnering broad public support for di cult reforms. e reduc- tion in regressive and ine cient fuel subsidies has provided the nancial means for it.”
One staple that remains o -limits is bread. e Ministry of Interior Trade, in early July, said it would cover the cost of higher cooking gas charges, rather than bakeries. e government produces more than 11bn loaves per month, which it distributes to the eligible – around 76mn people – for a xed, low price.
While the pressure is on to reform the subsidy system, the government is always aware of the sensitive nature of bread prices and the role these played in rioting in the late 1970s.
ere were also protests in 2017 over govern- ment e orts to reduce the amount of subsidised bread.
Egypt has increased the amount of LNG it exports, driven largely by the volumes of gas produced from its offshore. Plans for addi- tional Israeli supplies are underway, although it appears gas will not ow into Egypt until the end of the year.™
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w w w . N E W S B A S E . c o m Week 28 17•July•2019