Obama unveils $7bn power venture

United States President Barack Obama, putting his mark on US aid to Africa, announced an initiative to boost access to electricity in sub-Saharan Africa and said the US stood to benefit if the continent reached its full potential.

Obama unveiled the $7-billion (R69bn) venture dubbed Power Africa at the University of Cape Town in a speech that his aides billed as the centrepiece of his three-country tour through Senegal, South Africa and Tanzania to promote trade and investment on the rapidly growing Africa.

With former president Nelson Mandela’s fragile health weighing heavily throughout the trip, Obama has invoked the anti-apartheid icon’s legacy to draw the connection between democratic values and economic growth.

Obama’s goal is to double access to electricity across six countries that his aides have singled out for promoting good governance – Ethiopia, Ghana, Kenya, Liberia, Nigeria and Tanzania.

“There’s an energy here that can’t be denied: Africa rising,” but progress was “fragile”, vulnerable to “the rot of corruption” and “the undertow of conflict”, he said. “There’s no question Africa’s on the move, but it’s not moving fast enough for the child still languishing in poverty.”

Obama spoke in the same hall where Robert F Kennedy gave his “Ripple of Hope” speech in 1966, shortly after Mandela was imprisoned. Aides said they chose the venue to emphasise the themes of Obama’s trip.

US administration officials said the $7bn in government assistance would complement $9bn in private funds to double access to power in sub-Saharan Africa, where more than two-thirds of the people were without electricity, according to the White House.

During the first, five-year phase, the project aims to add more than 10 000 megawatts of cleaner, more efficient electricity generation capacity and will expand electricity access to at least 20 million new households and commercial entities, according to the White House.

General Electric is among the companies that have contributed to the $9bn in private sector funding for the programme’s first phase. It has committed to help bring 5 000MW of new energy to Tanzania and Ghana.

Officials declined to put a price tag on the total effort and did not specify how much of the $7bn in government resources Congress would need to appropriate for the initial phase. The sum was not all straight assistance and included money from the US Agency for International Development, the Overseas Private Investment Corporation, the Export-Import Bank and other agencies.

Credits: Julianna Goldman and Margaret Talev/Business Report/Bloomberg

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