KELLY ALEXANDER: Continental shift: the tables may have turned, but can Africa take its seat as an equal?
New scramble for Africa’s favour presents a unique opportunity
As another winter approaches in the northern hemisphere the question of energy security is once again in the spotlight. Still not entirely free of its dependence on Russian gas, the pressure is on for Europe and other Western powers to find alternative sources of reliable energy. Africa, with its enviable solar and wind resources, along with the mineral resources needed to fuel the clean energy transition, is a prime contender.
This has set off a cap-in-hand scramble for Africa’s favour, which presents a unique opportunity for African states and organisations to come to the negotiating table as equals, flipping a centuries-old power structure.
In 2022 Senegal hosted German Chancellor Olaf Scholz and Poland President Andrzej Duda, both of whom are looking to broker gas deals.
Algeria, Angola, Congo Republic (Brazzaville) and Mozambique were visited by Italian government ministers along with representatives from Eni, one of the world’s largest energy companies. Even Zimbabwe, so often left out in the cold where foreign investment is concerned, is being courted for its abundance of mineral resources.
Investment into new and renewed energy projects will undoubtedly have enormous economic and social benefits across the continent, creating jobs and economic growth. That said, African countries will need to have the presence of mind to ensure that they balance their own needs against those of the rest of the world, or risk deepening their own energy crisis and missing the opportunity to ensure a just energy transition.
Africa’s great irony is that while it has an abundance of significant renewable resources it also has the lowest rate of energy access globally. About 600-million Africans, about 50% of the continent’s population, do not have access to electricity. A further 900-million Africans lack access to clean cooking fuel.
To add to these ironies, the average African has a carbon emissions footprint that is 11 times smaller than the average North American, and Africa is one of the lowest contributors to greenhouse gas emissions, even as it is being pressured to switch to renewable energy sources. But there are concerns that this could limit the continent’s ability to fast-track its own much-needed economic growth in the face of rising energy demand from fast-growing populations and power-hungry industries.
The pressure is therefore on for leaders at all levels of business and government to act, but they need to do so with wisdom. The opportunities are there to leapfrog Africa into the renewable age, but this cannot come at the expense of the continent’s growth and prosperity. Past experience has shown that where economic activity was skewed towards resource extraction this created dependencies and vulnerabilities in economic systems that will not serve the continent . .
It’s a bit of a high-wire act. The choices we make now need to secure green investment and grow economies, but also secure local energy demand, create jobs and protect communities that are likely to suffer from job losses in coal and oil.
To set the parameters for engagement on their own terms, African business leaders can start by repositioning themselves as partners in the policymaking process to co-create workable policies that encourage investment and boost productivity by creating clarity and certainty.
The EU and US, for example, have proactive policies around the hydrogen industry that create clarity and incentivise investment that African countries would do well to emulate.
African policy around renewable energy must also strive to have an effect beyond business, ensuring a just energy transition that addresses systemic challenges of poverty, inequality and unemployment. By partnering with communities and other stakeholders, businesses can assist in this regard, co-creating innovative solutions that work on multiple levels to protect jobs and build trust.
For example, Solar Sister, a female economic empowerment organisation, puts clean power in the hands of off-the-grid African communities by training women entrepreneurs and supplying them with affordable solar-powered products and clean stoves. This enables the women to earn an income by selling much-needed products directly to those in their communities who do not have access to energy.
Similarly, GreenCape, an organisation that drives the adoption of economically viable green energy solutions in SA, developed wi-fi-enabled solar street lights that provide connectivity while addressing community concerns around safety and lack of infrastructure.
For business leaders, the success of these initiatives is a reminder to think with local communities and not for them as we move forward into a new energy age for Africa and the world.
There is almost unlimited potential ahead for impact, growth, development and improvement across Africa. The full spectrum of investment opportunities exists, including mining, manufacturing, industry, training and development and innovation, with opportunities across regional, state, community and household level.
Africa’s combination of unique resources — people, minerals and markets — gives it the opportunity to develop advanced technologies and new industries that could bring about significant change to people’s lives, but our guiding principle needs to be to leverage the strength of a variety of actors and start with the here and now of what will benefit Africans first.
• Dr Alexander is associate member of the Centre for Emerging Markets & Consumer Studies at Henley Business Schools Africa and author of a new white paper: Powering Africa’s Growth: The Renewable Energy Landscape.
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