MechChem Africa

Following an ‘awful’ 2016, Peter Middleton looks for reasons for optimism in Africa.

Peter pic latestTowards the end of 2016, a year universally acknowledged as ‘awful’, Cummins Southern Africa held an upbeat breakfast to introduce its new regional distribution MD, Thierry Pimi. “I am proud to be back in Africa,” said Pimi, who was born, raised and educated in Cameroon. “There is nowhere in the world I would rather be. While the continent presents big challenges, it also offers huge opportunities,” he said.

Cummins, through its engine, power, components and distribution businesses, “plays in the heart of what is needed in Africa today: infrastructure development, power generation and minerals extraction. We are a central player in all these arenas,” Pimi suggested.

Commentators are seeing the consequences of Brexit and an inward-looking Trump-led USA as indicators of an “economically tumultuous” 2017. Yet, according to Lynsey Chutel writing for Quartz Africa recently: “Some African countries could see sustain- able growth beyond the usual narrative of Africa alternatively ‘rising’ and ‘reeling’”.

Quoting former executive producer of the World Economic Forum (WEF) in Davos, Richard Attias, Chutel writes: “The countries that will be successful in 2017 – whatever happens in the global economy – are the countries that are diversifying their economies.”

Attias believes that focusing on renewable energy, industrialisation and manufacturing will enable African countries to grow. He says that new energy sources allow countries to build new industries while stabilising their power grids and diversifying beyond fossil fuels.

And: “manufacturing gets countries to process raw materials domestically”. He hopes 2017 will be the year of the African product label. “We would be proud to see ‘Made in Africa,’” he says. “This would be the turning point, the really important turning point in making this continent sustainable, rich and looking forward to the future.”

Chutel points out that neither South Africa nor Nigeria, responsible for half African GDP between them, are likely to return to sustainable growth. “This could be the time for Francophone Africa to step up,” she suggests.

Her article cites five fastest growing African countries to watch in 2017: Cote d’Ivoire, with growth projected at 8.6% for 2017, Senegal at 6.4%, followed by Togo and Benin (5.5%) and Morocco (4.5%).

Cote d’Ivoire continues to be peaceful and its National Development Plan has been extended to 2020, with associated foreign investments of US$15.4- billion. According to Attias, sustained growth will come from Cote d’Ivoire’s renewable energy projects and its ambitions to become a regional energy hub.

Senegal is launching a high-speed train link between the new Blaise Diagne International Airport and central Dakar. Launched in 2014, its ‘Plan for an Emerging Senegal’ covers projects ranging from infra- structure and transport, energy, water and sanitation developments.

Togo is modelling itself on Singapore and Dubai, developing the natural deep-water port of Lome to serve West and Central Africa. It has also cut the amount of time it takes to set up a business from 38 days in 2012 to 10 days. In addition, the country has set up an anti-corruption body, which is seeing its international transparency ratings improve.

In Benin, Attias believes the country’s political stability in the last decade, a new economic plan and government commitments to reform the cotton industry and diversify its economy will bring the necessary growth. Investment plans include the country’s ports, a stronger power grid, and development of the telecommunications industry.

Morocco is also turning its focus to renewable energy with the Tarfaya complex in the Sahara desert – 131 wind turbines and a total installed capacity of 301 MW – Africa’s largest wind energy project. Next on King Mohammed VI’s agenda is building the world’s largest solar farm. And toward the end of 2016, Morocco signed a deal with Nigeria to jointly construct a gas pipeline to Europe.

In preparation for Davos 2017, the WEF has just published a document called the ‘Renewable Infrastructure Investment Handbook: A Guide for Institutional Investors’. The handbook cites two factors that were inhibiting renewable energy investments: scale and risk.

Scale, the guide argues, is no longer an issue since, to meet COP21 clean energy commitments, global investments in the region of US$200-billion per year between now and 2030 will be required.

Also though: “by 2020, solar photovoltaic is projected to have a lower levelised cost of energy (LCOE) than coal or natural gas-fired generation throughout the world”, and: “renewable infrastructure has moved much closer to utility-like investments and no longer presents frontier technology-like risks.”

I think Thierry Pimi has good reasons for optimism. Africa is rich in renewable resources and poor in infra- structure, a combination that screams opportunity. With a little microgrid-type thinking, we could become a model continent for sustainability, both in terms of clean energy and economic growth.

We hope your 2017-year is a better one.

Peter Middleton

BANNER 8

Contact MechChem Africa

Title: Editor
Name: Peter Middleton
Email: mechchemafrica@crown.co.za or peterm@crown.co.za
Phone: +27 11 622 4770
Fax: +27 11 615 6108

Title: Editor
Name: Glynnis Koch
Email: mechchemafrica@crown.co.za
Phone: +27 11 622 4770
Fax: +27 11 615 6108

Title: Advertising Manager
Name: Brenda Karathanasis
Email: brendak@crown.co.za
Phone: +27 11 622-4770
Fax: +27 11 615-6108

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