The Trillion Dollar African opportunity
The day the American Dream turns into the African dream, it will be because of optimists like Martin Ganda. He’s a Zimbabwean born African focused investor, advisor and strategist. Below is a speech he delivered at Africa Utility Week in Cape Town. He sweeps aside the negative and unearths the potential the continent has to offer – “The job of future African leaders is to look beyond the foreseeable future”.- Stuart Lowman
n American football stadium uses the same amount of power during a match as the entire country of Liberia uses in one day. 85% of rural Africans must burn biomass for fuel, threatening their own health and the health of the environment. Thousands of women and children must spend hours each day collecting fuel rather than educating themselves or entering the working world. In sub-Saharan Africa, 75% of the population and 30% of health facilities, including hospitals and laboratories, do not have electricity. Less than 2% of the rural populations in Chad, Ethiopia, Malawi, and Niger have access to electricity.
These numbers are disheartening. But there are other numbers that give us hope. Africa produces 11% of the world’s oil, 6% of its natural gas, and 4% of its coal. Our potential for wind power is enormous – Sudan’s wind alone could provide the power to supply 90% of its energy needs. The Great Rift Valley in East Africa could generate 9,000 MW in geothermal energy. Many areas in sub-Saharan Africa feature daily solar radiation between 4kWh and 6kWh per square meter. Only 5% of our hydropower potential is exploited.
We live on one of the richest continents in the world, both in resources and human capital. Renewable energy is inevitable, and we are poised to be on the cutting edge of it, from hydroelectricity to solar power to wind power. Demand for electricity is likely to increase six-fold by 2050. The bricks we lay today will pave the path for an Africa of the future, where our children will all have access to basic needs like electricity. But how can we turn our resources from untapped potential into a source of wealth for the continent?
We’ve got a good start. 6 of the top 30 energy producers call Africa home. Sadly, much of this energy is exported rather than used to fuel Africa. 90% of Nigerian oil is exported to non-African countries, while Nigeria imports about 70% of the processed oil products it needs to meet domestic requirements. . The country currently has 4 oil refineries with the total capacity to process about 445,000 barrels/day, but they operate below capacity. Regional power trade would save Africa $2 billion a year, and make us less reliant on others for our needs.
Why haven’t we begun to take strides to explore and utilize our bountiful resources? We need strong leadership in the energy and business sectors. Look at European or American infrastructure. It didn’t just spring up in the last few decades. Dozens of years ago, entrepreneurial citizens took risks – on electricity, on railroads, on fiber optics. Now, it’s our turn. The legacy we leave for our children and our children’s children will take more than five or ten years to create. Both the private and public sector need to work towards a sustainable, long-term future for our descendants, which will in turn create shared wealth for all citizens of Africa.
We have an unprecedented connection to the global market, in addition to focusing more on what the world can do for Africa, we also need to focus on what Africa can do for the Africa. African natural resources are abundant, but they are either undeveloped or exported. Developed resources should first benefit the continent and its citizens. Our many untapped resources represent an opportunity for investors and businesses throughout the world, but they will remain unused unless our political leaders create a climate that is conducive to trade and technology.
Our job, as future leaders of Africa, is to look beyond the foreseeable future. Don’t ask what Africa will be like in ten years, or twenty, or thirty. Instead, think about how you can impact the Africa of year 2100. Will we become a major power player, or will our incredible resources, human capital, and energy potential remain dormant?
We have trillion dollar opportunities buried in our lands, not just for us but for our descendants. It won’t be easy to unearth them. Africa requires more than $300 billion in investment capital to achieve universal electricity access by 2030. If we were to reinvest just 5% of our oil and coal export revenue, the Africa Development Bank predicts we could raise that money and meet that goal.
We have to challenge the status quo. Africa’s future is in our hands. As captains of industry, entrepreneurs, and government leaders, we can change the future of this great continent. Our voices in the boardroom and the political arena can transform our energy and power trajectory.
The consequences of our leaders’ inaction thus far reverberate throughout the continent, impacting the lives of our fellow brothers and sisters. Through energy and power investments, global alliances, and policy advocacy, we can empower our fellow Africans, create economic returns for our investors, and create a legacy to be proud of.
* Zimbabwe-born Martin Ganda is an Africa focused investor, advisor and strategist.
Published on BizNews.com
Photo: Africa Plus