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Changing Dynamics of the Sub Sahara Africa Power Sector - Increasing Investments by Foreign Players
Changing Dynamics of the Sub Sahara Africa Power Sector - Increasing Investments by Foreign Players
Abundant Natural Resources But Limited Power Generation
Hyderabad,
AP,
India
(prbd.net)
12/05/2011
Africa is endowed with resources vast enough to meet all its energy needs. Africa is endowed with resources vast enough to meet all its energy needs. Hydroelectricity is by far the single biggest source of electricity in a number of countries. The region possesses some of the largest water courses in the world - he Nile, Congo, Niger, Volta and Zambezi river systems. The hydropower potential of the Democratic Republic of Congo alone is estimated to be sufficient to generate three times electricity than what Africa
currently consumes. This potential remains largely untapped.
With a total installed capacity of the countries of Sub-Saharan Africa at 68 GW, the total generation capacity is less than that of Spain. Excluding South Africa, the total installed capacity is merely 28 GW or equivalent to the installed capacity of Argentina. Approximately 25% or 7 GW of this installed capacity is not utilized for electricity generation due to a variety of reasons, including aging plants and lack of maintenance. Only 24% of the regions population has access to electricity when compared to 40% in low income countries
More than two-thirds of the countries in Sub-Saharan Africa are currently experiencing crippling electricity shortages. Ironically, this crisis has been spurred by the strong economic growth in the region which has in turn led to rapid increase in electricity consumption and urbanization. Poor planning for boosting generation and distribution capacity and maintaining infrastructure has exacerbated the pressure on power supplies.
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There are several stringent conditions, such as interference in state sovereignty, attached to any aid sought from other countries or organizations, particularly from Western countries and organizations. As a result, Sub-Saharan African countries prefer China as a suitable alternative to Western nations. China’s policy towards Africa includes financial assistance, preferential finance and debt cancellation. In order to develop its involvement in the region, the Chinese government established the China-Africa Fund with an initial sum of $1 billion. Moreover, many sub-Saharan African governments indicated that the West’s perceived intransigent economic policies, and most importantly China’s absence of any conditions on aidgiving, were powerful incentives for dealing with Chinese companies. For instance, Western countries have adopted a policy called the debt-sustainability framework. The Western governments emphasized that this policy would assist in monitoring new credits in a better way and prevent debt crises from arising in the most vulnerable countries. However, many sub-Saharan African countries consider this as a restrictive strategy and as a result prefer dealing with China.
GlobalData’s “Changing Dynamics of the Sub Sahara Africa Power Sector - Increasing Investments by Foreign Players to Drive Growth of the Region” gives detailed information on the Africa power market and provides an overview of the key factors driving investment in the sector. The research analyzes investment trends in the regions power sector and also detailed analysis of the leading countries in this region. This, coupled with funding analysis, power finance structures provides a comprehensive
understanding of the market’s scenario.
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