Two African Banks Stake USD 16 Billion in Oil, Gas Projects
About USD 16 billion is being invested in oil and gas projects across Africa by the African Export-Import Bank (Afreximbank) and the African Finance Corporation (AFC). This was recently disclosed at the Cape Town, South Africa African Refiners and Distribution Association (ARDA) conference. This is coming as stakeholders at the conference urged Africans to keep funds within the continent to finance the over USD 190 billion yearly energy investment needed. Of the banks’ investment, USD 15 billion of the funds is invested by Afreximbank. AFC has already invested over USD 800 million, with an additional over USD 200 million expected to be finalised. Global Head, Client Relations at Afreximbank, Rene Awembeng, said the company’s oil and gas portfolio exceeds USD 15 billion with a healthy pipeline across the continent. Speaking on the sideline of the conference, he noted that the continent must focus on shared infrastructure and be ready to finance itself; otherwise, projected development may remain elusive. Awembeng stated that the continent is in a critical situation where demand for energy continues to rise on the backdrop of a surging population. With the continent relying mainly on the importation of petroleum products at a time when foreign exchange demand is hovering at USD 100 billion yearly and required energy investment annually stands at USD 190 billion, Awembeng said large infrastructure development, including refineries that would meet demand on the continent, must be prioritised and supported.
Source: The Guardian
EBID to Finance Green Projects to Support Sustainable Growth
The promotion of inclusive and sustainable growth in the West African economy. This is the purpose of the new green finance mechanism set up by the Economic Community of West African States (ECOWAS) Bank for Investment and Development (EBID). The ecological transition should accelerate very soon in West Africa. EBID will finance green projects through its recently published inaugural Environmental, Social and Governance (ESG) Finance Framework. The funds it will release over the next three years will be used to implement the United Nations (UN) Sustainable Development Goals (SDGs) initiatives in its member states. These projects presented by the governments of the targeted countries via local companies will contribute to promoting economic integration, social protection (health, education, housing) and especially climate resilience in the region. “We will promote the emergence of an economically strong, industrialised and prosperous West Africa. This framework will therefore enable us to structure and execute environmentally responsible financing transactions as outlined in our Strategic Plan 2021-2025,” explains George Agyekum Donkor, EBID’s chairman of the board of directors.
Source: AFRIK 21
Algeria / Uganda
Uganda Strengthens its Cooperation with Algeria through Seven New Bilateral Agreements
Uganda and Algeria have strengthened their cooperation by signing seven new bilateral conventions. The signatures were signed during President Museveni’s visit to his counterpart Abdelmadjid Tebboune. Composed of two cooperation agreements and five memorandums of understanding, the agreements cover various sectors vital to both countries’ economies. According to the Algerian press, these sectors include energy, tourism, trade, agriculture, animal health, as well as higher education and scientific research. Both governments aim to facilitate mutual investment in these areas while enabling Algeria to advance its strategy of economic rapprochement with the rest of Africa.
Source: Algeria Times
Egypt Tops List of MENA Countries Sealing Deals with Startups in 2022
The Egyptian Cabinet’s Information and Decision Support Center (IDSC) revealed that Egypt topped the list of countries in the Middle East and North Africa region for its number of startup deals, coming in at 160 deals in 2022. According to the IDSC, the UAE ranked second with 153 deals, Saudi Arabia third with 144 deals, Qatar fourth with 45 deals, and Tunisia fifth with 30 deals. Egyptian startups raised finances amounting to USD 517 million in 2022. The financial technology sector came first in terms of financing volume with USD 217 million. In contrast, the e-commerce sector came second with USD 148 million, and the transport and logistics sector came third with USD 62 million. Retail came fourth with USD 17 million, followed by the healthcare sector with USD 12 million. The number of investors in Egyptian startups increased by 30 percent during 2022 to reach 160, compared to 123 investors in 2021, according to the IDSC, which said that emerging companies are importance to the Egyptian economy. It added that, in addition to their significant contribution to supporting the state’s strategy for digital transformation by providing technical services to citizens and companies, startups are an important source for attracting foreign direct investment to the Egyptian economy. In December 2022, Ghada Khalil, director of the Rowad 2030 Project, a plan that aims to boost self-employed culture among Egyptian youth, said that the number of startups operating in Egypt currently stands at 677, while the average number of job opportunities in running startups is 45,955. Khalil added that Egyptian startup companies experienced record growth in the volume of venture investment during the past five years, at a compound annual growth rate of 83.81 percent, and that the total value of investments during that period stands at approximately USD 1.5 billion.
Source: Egypt Today
Fintechs Tipped to Drive Next Phase of Digital Banking Shift
Banks and financial technology firms (Fintechs) have been tipped to deepen collaborations as customers continue to disrupt traditional banking models. Speakers at the seventh edition of Connected Banking Summit themed Accelerating Digital Inclusion and Sustainable Transformation said banks and Fintechs will increasingly become collaborators as opposed to competitors to build digital banks. The summit’s series offers a platform for financial sector players to discuss ways of building future-oriented banking models that fit ’customers’ changing needs without compromising on security and privacy. “Banks are partnering with Fintechs to meet speed and agility and this collaboration has to continue. Fintechs cannot be seen as competitors who are eating into the income of banks,” said Winnie Syowai Onyancha, senior transaction banking manager at KCB Group. Customers are increasingly turning to digital channels such as mobile and internet banking in search of speed and convenience instead of visiting physical branches. Banks have been asked to collaborate with Fintechs to develop local solutions that can strike a balance between convenience, security and privacy.
Source: Business Daily
Consortium signs USD 34 Billion MoU for Hydrogen Project in Mauritania
German project developer Conjuncta recently said it signed a memorandum of understanding with Mauritania, Egypt’s energy provider Infinity and the United Arab Emirates’ Masdar for a USD 34 billion green hydrogen project in the West African country. The project will have a production capacity of up to 8 million tonnes of green hydrogen or other hydrogen-based end products annually, with an electrolyser capacity of up to 10 gigawatts, the company said in a joint statement with the firms involved and the Mauritanian government. “(This project) will have a strong link to Germany both as a technology provider and a potential off-taker of green energy,” Conjuncta Chief Executive Stefan Liebing said. Germany has been scrambling to ramp up its renewables capacity to compensate for Russian fuel imports and meet climate targets. In December, Berlin approved the construction of the country’s first hydrogen pipeline network. The first phase of the Mauritania project, to be located northeast of the coastal capital of Nouakchott, should be completed in 2028 with planned capacity of 400 megawatts, it said.
Namibia’s Oil Exploration Shows Promise with Third Oil Discovery
A recent announcement of the third oil discovery made in the offshore Orange Basin by Shell Namibia, Qatar Energy, and Total Energies brought Namibia’s petroleum industry back into the limelight. As a result of the recent successful oil discoveries, there has been an influx of international upstream and midstream service providers spurting to Namibia seeking their corporate residence in Namibia’s petroleum sector. A keen eye of interest is being focused on the country as potential investors are continuously induced to invest in the exploration or production of petroleum or the provision of auxiliary upstream and midstream services. Investors looking to explore and develop petroleum in Namibia will find the petroleum sector licensing regime straightforward. Additionally, those who wish to provide auxiliary upstream or midstream services to licensed companies can register their businesses in Namibia by complying with standard business registration and tax requirements. As far as local content requirements are concerned, the conditions imposed on petroleum licenses of exploration or production companies will best guide investors regarding what local content requirements must be considered to provide auxiliary upstream or midstream services to licensed companies.
Source: Business Insider
Tanzania Kickstarts Contract Preparations for USD 30 Billion LNG Project
Global energy majors Shell and Equinor have officially started the contract preparations for the development, operation, and maintenance of a USD 30 billion liquefied natural gas (LNG) terminal in Tanzania. The preparations follow the finalisation of project negotiations with the Tanzanian government. According to the Minister of Energy of Tanzania, January Makamba, “negotiations on the construction of the LNG project were complete, and now experts are drafting contracts. Of these contracts, one is about the Host Government Agreement, and another is on joining blocks 1, 2, and 4, which will provide natural gas for the LNG project.” With the Equinor-operated Block 2 estimated to hold over 20 trillion cubic feet (tcf) of gas while the Shell-operated Blocks 1 and 4 estimated to hold combined reserves of 16 tcf of recoverable gas, the contract would see these blocks providing feedstock to the large-scale LNG facility. The milestone comes after Shell, Equinor and the Government of Tanzania agreed to fast-track the development of an LNG export terminal in June 2022 following regulatory delays. The project’s final investment decision is expected to be announced by 2025.
Source: Energy Capital & Power
Uganda Plans to Start Nuclear Power Generation By 2031
Uganda has said it expects to start generating at least 1,000 megawatts (MW) from nuclear power by 2031 as it moves to diversify its sources of electricity and accelerate its energy transition, a key part of its climate change response. Uganda has uranium deposits, and President Yoweri Museveni has said his government was keen to exploit them for potential nuclear energy development. The East African country has signed a deal with China under which the China National Nuclear Corporation (CNNC) would help Uganda build capacity to use atomic energy for peaceful purposes. The first nuclear project, Buyende Nuclear Power Plant, would be located at Buyende, about 150 km north of the capital – Kampala. The Energy and Minerals Minister Ruth Nankabirwa Ssentamu said in a statement. “Preparation to evaluate the Buyende Nuclear Power Plant site is ongoing to pave the way for the first nuclear power project expected to generate 2,000 MW, with the first 1,000 MW to be connected to the national grid by 2031,” she said. “Uganda is making firm steps to integrate nuclear energy into the electricity generation mix to ensure energy security and provide sufficient electricity for industrialisation.”
Bain & Company | Global Private Equity Report 2023
As extraordinary and resilient as the post-COVID-19 rally in global private equity proved to be, it was ultimately no match for the Fed. For the first six months of 2022, the industry extended 2021’s record-shattering burst of deal activity, despite persistent inflation, the invasion of Ukraine, and growing tensions with China. Then, in June, when US central bankers issued the first in a series of three-quarter-point interest rate hikes—and their colleagues worldwide followed suit—banks pulled back from funding leveraged transactions, and dealmaking fell off a cliff, pulling exit and fund-raising totals down with it. Given the heights from which they fell, buyout deal value (USD 654 billion), exits (USD 565 billion), and fund-raising (USD 347 billion) all finished 2022 with respectable totals in a historical context. But the sudden reversal marked the end of an upcycle that has endured (with a brief COVID brake tap) since 2010 when the industry emerged from the global financial crisis and produced a 12-year run of stunning performance. It remains to be seen whether the abrupt shift from accommodation to tightening will trigger what could be called the most anticipated recession in history that hasn’t happened yet—at least not in the US. A tight labour market and lingering COVID-related stimulus have kept the economy limping. The fleeting two-quarter dip in 2022 wasn’t officially deemed a recession. Yet there’s no denying the impact of the unprecedented mix of macro forces in play. The resulting rise in rates has already shut off the spigot of cheap, obtainable debt financing.
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IRENA |Planning and Prospects for Renewable Power North Africa
This report is part of International Renewable Energy Agency’s (IRENA) series on planning and prospects for renewable energy, focusing on renewable electricity generation in African power pools. Its context is the lack of a regional master plan for power system expansion in North Africa (Algeria, Egypt, Libya, Morocco, Mauritania and Tunisia) and IRENA’s involvement in the search for energy transition pathways for the region. A recent example of that involvement is IRENA’s participation as a modelling partner for the development of the African Continental Power Systems Master Plan (CMP), an initiative led by the African Union Development Agency’s New Partnership for Africa’s Development (AUDA-NEPAD) with the technical and financial support of the European Union. This report presents various scenarios for power system expansion in North Africa through 2040, including the potentialities of hydrogen production and of interconnections within and outside the region (Southern Europe through Morocco and Tunisia; and Western Asia through Egypt). Feedback from national experts was collected during a workshop in March 2022, but this report does not necessarily reflect countries’ official positions. Nor does it intend to prescribe a path for power sector development. The report is based on the System Planning Test Model for North Africa (SPLAT-North Africa), developed by IRENA and built on publicly available data. SPLAT-North Africa can be used in future capacity-building events and by the region’s countries to conduct their analyses.
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World Bank | Digital Africa: Technological Transformation for Jobs
All African countries need better and more jobs for their growing populations. “Digital Africa: Technological Transformation for Jobs” shows that broader use of productivity-enhancing digital technologies by enterprises and households is imperative to generate such jobs, including for lower-skilled people. At the same time, it can support countries’ short-term objective of post-pandemic economic recovery and their vision of economic transformation with more inclusive growth. These outcomes are not automatic, however. Mobile internet availability has increased throughout the continent in recent years, but Africa’s uptake gap is the highest globally. Areas with at least 3G mobile internet service now cover 84 percent of Africa’s population, but only 22 percent use such services. And the average African business lags in the use of smartphones and computers as well as more sophisticated digital technologies that catalyse further productivity gains. Two issues explain the usage gap: the affordability of these new technologies and the willingness to use them. For the 40 percent of Africans below the extreme poverty line, mobile data plans alone would cost one-third of their incomes—in addition to the price of access devices, apps, and electricity. Data plans for small- and medium-sized businesses are also more expensive than in other regions. Moreover, shortcomings in the quality of internet services—and in the supply of attractive, skills-appropriate apps that promote entrepreneurship and raise earnings—dampen people’s willingness to use them. For those countries already using these technologies, the development payoffs are significant. New empirical studies for this report add to the rapidly growing evidence that mobile internet availability directly raises enterprise productivity, increases jobs, and reduces poverty throughout Africa. To realise these and other benefits more widely, Africa’s countries must implement complementary and mutually reinforcing policies to strengthen both consumers’ ability to pay and willingness to use digital technologies. These interventions must prioritise productive use to generate large numbers of inclusive jobs in a region poised to benefit from a massive, youthful workforce—one projected to become the world’s largest by the end of this century.
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Africa Development Bank Group | Towards the Preparation of an African Green Minerals Strategy
As the world grapples with the challenges of climate change, the transition away from fossil fuels is having a major impact on the minerals industry. Metals used in electrification, renewable energy generation, electric mobility and new forms of energy storage have become critical to these expanding low and no carbon industries. Africa is endowed with many of the most important minerals, and the increased demand makes it imperative that stewardship of these resources be guided to maximise the benefits of their exploitation to the continent and its people. The African Natural Resources Management and Investment Centre (ANRC) within the African Development Bank and its partners, the African Minerals Development Centre (AMDC), the African Legal Support Facility (ALSF), the United Nations Economic Commission for Africa (UNECA), the United Nations Development Programme (UNDP) have initiated the development of an African Green Minerals Strategy (AGMS) to proactively engage with the new conditions flowing from the energy transition. The strategy is intended to augment the existing body of mineral development policies with a focus on the opportunities created by these new conditions. To formulate a strategy that is grounded in the prevailing circumstances of African countries and informed by local, regional and global conditions, this Approach Paper has been prepared as the precursor study for a fully-fledged African Green Mineral Strategy (AGMS ) which is to follow. Minerals required for the energy transition and which are produced on the continent define the scope of the AGMS. The vision for the strategy is to guide Africa to strategically exploit the continent’s green mineral resources for industrialisation and to assert control over its destiny to create an African presence in emerging green technologies.
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