MechChem Africa

MechChem Africa

•

January 2017

AFRICA

and sustainable growth

owards 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

anddistributionbusinesses, “plays in theheart ofwhat

is needed inAfrica 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 in-

dicators 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 thatwill 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,

industrialisationandmanufacturingwillenableAfrican

countries to grow. He says that newenergy sources al-

low 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 coun-

tries 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,withassociatedforeigninvestmentsofUS$15.4-

billion. According toAttias, sustainedgrowthwill come

fromCote d’Ivoire’s renewable energy projects and its

ambitions to become a regional energy hub.

Senegal is launching a high-speed train link be-

tween 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 ismodelling itself onSingapore andDubai, de-

veloping 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 reformthe cotton indus-

try and diversify its economy will bring the necessary

growth. Investment plans include the country’s ports, a

stronger power grid, anddevelopment of the telecom-

munications industry.

Morocco is also turning its focus to renewable

energy with the Tarfaya complex in the Sahara des-

ert – 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 theendof 2016,

Morocco signedadeal withNigeria 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 pro-

jected 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.

Witha littlemicrogrid-type thinking, we couldbecome

a model continent for sustainability, both in terms of

clean energy and economic growth.

We hope your 2017-year is a better one.

MechChem Africa

is endorsed by:

Peter Middleton