BIZweek n°376 7 jan 2022
BIZweek n°376 7 jan 2022
  • Prix facial : gratuit

  • Parution : n°376 de 7 jan 2022

  • Périodicité : hebdomadaire

  • Editeur : Capital Publications Ltd

  • Format : (260 x 370) mm

  • Nombre de pages : 8

  • Taille du fichier PDF : 1,6 Mo

  • Dans ce numéro : rapport Africain sur l'énergie 2022.

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VENDREDI 07 JANVIER 2022 BIZWEEK ÉDITION 376 You may be wondering if African energy banks are a realistic goal. How can a continent that is struggling to bring many of its people out of poverty raise capital for energy projects ? I believeit can be done. To begin with, African governments can set aside a percentage of their oil and gas revenues for new project funding. In our report, Africa Energy Outlook 2021, the African Energy Chamber projected that African governments’earnings from royalties, profit oil, and other taxes in 2021 would reach USD 100 billion. Even 5% of that amount would produce $50 million that could be leveraged for exploration, development, or infrastructure. We can also raise capital by investing African pension funds in African energy projects. According to Capetown-based investment firmRisCura, local pension funds collectively manage around USD 350 billion of assets in sub-Saharan Africa, and they are actively looking for new places to invest. Why not encourage them to add oil, gas, and renewables projects to their list ? Investing pensions in the energy sector is hardly a new practice. Some of America’s largest pension funds are invested in fossil fuel producers and pension funds around the globe are investing in green energy projects. This would not be a giveaway  : Investing in fossil fuels, especially gas projects and developing marginal fields, provides a large return on investment. And millions of Africans would be participating in our growth and our future. Build on Afrieximbank’s model Our options for raising capital don’t end there. We also should seek the support of wealthy Africans who want to invest in a better African future. As of December 2020, total private wealth in Africa totaled approximately USD 2 trillion. That’s not even including the African diaspora. Imagine what can be done if we just unite. POST SCRIPTUM ketelter ; len.fflied jiblià46 114 >,.11girl (e7-'*2.%2/11-41"er, e- -""erei.z% 11"-4,4redie4.'- WVei et7eelree Not only do we have pathways for raising capital, we also have an example of the kind of bank(s) Africa needs to finance its own energy projects, one that goes back decades. I’m talking about the African Export Import Bank (Afrieximbank). In 1993, African governments worked with public and private investors to create a bank that would finance, promote, and expand intra-African and extra-African trade. They succeeded. In 2020, Afrieximbank received the Africa-America Institute’s (AAI’s) Institutional Institution of Excellence Award for its commitment to the creation and implementation of the African Continental Free Trade Agreement (AfCFTA) and its ongoing dedication to investing in education. AAI noted that between 2015 and 2019 alone, Afrieximbank disbursed more than $30 billion in support of African trade, including more than $15 billion for the financing and promotion of intra-Africa trade. Afrieximbank, by the way, recognizes the importance of protecting Africa’s oil and gas industry. « The way we see it at the bank, Africa produces less than 4% of greenhouse gas. We are not the problem of greenhouse gases. We are the victims. We are asking for balance, » Afrieximbank President and Chairman of the Board Benedict Oramah said. I say, let’s build on Afrieximbank’s model. And not only that, let’s cultivate a pool of investors who understand and appreciate the importance of oil and gas to Africa. Capital from foreign countries and companies willalways be welcome — as long as it isn’t predicated on phasing out fossil fuels on their timeline. If they’re pushing a rush to renewables, they’re not going to be part of our solution. Clear signal to the marketplace With the support of one or more African $M. tel4tlearàle- Ate go Am..^...seMedirrat#0. energy banks, local oil and gas companies will have the finances necessary to acquire assets. They’ll have the financing to build crude and gas pipelines across Africa and to facilitate the use of natural gas (including liquid natural gas) to power Africa, minimizing energy poverty and driving industrialization. And African states and entrepreneurs will be able to finance the development of renewable energy operations, particularly blue, green, and grey hydrogen operations that create additional opportunities for Africans. Africa already has emerging green hydrogen operations in Mali, Namibia, Gambia, Senegal, Mauritania, Niger, and South Africa, and with the proper funding, could become a major green hydrogen exporter. The African Energy Chamber will support the energy bank initiative and work to bring potential participants together. Creating our own institutions to finance energy projects will send a clear signal to the marketplace that Africans are seeking to become leaders in scalingup private capital. It will show that we are advancing natural gas development and infrastructure while supporting low-carbon investments. With the financing in place, not only will African companies be able to produce oil and gas, but they also will support local community development, develop green energy markets, and create jobs. The financing also willallow African companies toupgrade their refineries, an urgent need addressed by Anibor Kragha the Executive Secretary of African Refiners and Distributors Association during African Energy Week, so they can produce cleaner fuels. For many African countries, the oil and gas industry represents our best shot at giving millions of Africans the kind of jobs, living standards, and stability that developed countries have enjoyed for well over a century. We must hold fast to those goals and do what it takes to achievethem. 8

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