- Power vital to Africa’s economic well being
African business leaders have singled out the unavailability and erratic supply of power across the continent as the biggest impediment to Africa’s growth, advising governments to invest massively in the power sector to drive growth.
The President/Chief Executive of the Dangote Group, Aliko Dangote stated this as one of the panelists at a forum organized by the World Bank Group and the African Centre for Economic Transformation (ACET) in Accra, Ghana, with the aim of scaling up private sector investment in Africa.
He identified power as one of the biggest challenges Africa needs to address with urgent attention if governments want to see the continent grow. “No power, no growth. We need to make sure we tackle the issue of power,” the leading industrialist said at the first panel discussion at the Development Finance Forum.
Dangote said small businesses on the continent can never survive without stable power when the income or revenue generated is used in purchasing diesel to power and service generators.
“Meanwhile, these generators are meant to be backup or standby. But now the generators are those that are providing consistent power and the grid is now standby,” he bemoaned.
Calling for urgent action to address the continent’s power challenges, he said, “That does not make sense. For example, the entire state of Kano, with a population of 21 million people, has a power supply of less than 35megawatts from the grid. These are the issues we need to do. We must make sure that power is available, if not businesses cannot grow.”
Dangote Group has a joint venture agreement with the Black Rhino Group to develop a $5 billion (about N1 trillion) energy infrastructure in Africa. Black Rhino is a subsidiary of the Black Stone Group, the world’s current largest Private Equity and Asset Management Company. The joint venture agreement is already looking into setting up power plants in Kano and Abuja, Nigeria.
Dangote also signed agreements to increase electricity supply in Nigeria by building pipelines that will boost by four times the supply of natural gas in the nation. The project is backed by Carlyle Group LP and Blackstone Group LP, the world’s two biggest private-equity firms. The pipes will increase the amount of gas available in Nigeria to 4 billion standard cubic feet per day from 1 billion. Boosting domestic supply will help increase electricity generation as about 70 percent of electricity plants in Nigeria are fueled by gas.
The Dangote Group is an emerging conglomerate based in Nigeria, West Africa, with presence in more than a dozen African countries. Driven by a mission to touch the lives of people by providing their basic needs, current interests of the Group include cement, sugar, salt, pasta, beverages and real estate, with new projects underway in the energy, agriculture, oil and gas sectors. Some of the Group’s subsidiaries listed on the Nigerian Stock Exchange (NSE) include: cement, sugar, salt and flour. The Group, which started as a trading company in 1978, is fully involved in philanthropic activities that it executes through the Dangote Foundation.