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issue 513 | 10 Sep 2023

Africa

Africa must optimise all it has to achieve universal energy access, says AfDB head

The African Development Bank (AfDB) president Akinwumi Adesina has called for investments in renewable energy in Africa, pointing out the continent’s rich energy mix. In his keynote address (on 4 September) during a session on Harnessing Africa’s renewable energy potential, held at the Africa Climate Summit, president Adesina stressed: “Every economy can only go as far as the energy it produces.” Adesina underlined Africa’s tremendous potential in energy – from hydro and wind power, solar, to geothermal – which remains untapped, in the face of a staggering electricity deficit on the continent. Africa has an almost unlimited potential of solar capacity (11 TW); abundant hydro (350 GW), out of which only 5-6% is being harvested; wind (110 GW), of which only 2% is being used; and geothermal energy sources (15 GW), he said. He added: “We have to make sure we combine renewable energy sources and give Africa energy security, energy stability, affordability of energy and independence into the energy sector, to be able to power its economy.” The bank president affirmed the importance of accelerating private sector investments in renewable energy but said this would require political support which would result in better policies and better incentives to attract private sector financing.

Source: AfDB

Africa

At Africa Climate Summit, global leaders unite to put continent at heart of fight against climate change

World leaders gathered in Nairobi for the inaugural Africa Climate Summit have pledged their support to position the continent at the centre of the fight against climate change, urging greater consideration for Africa’s priorities and endowments. The historic three-day event, hosted by the Government of Kenya and the African Union, kicked off on Monday, 4 September. Much of the conversation focused on climate adaptation, which is widely viewed as a pressing priority for Africa. Kenya’s President William Ruto said Africa’s youthfulness was “precisely the attribute that inspired African leaders to imagine a future where Africa steps onto the stage as an economic and industrial power, an effective and positive actor in the global arena.” President Ruto listed several reasons why the continent is well placed to lead in tackling climate change. “Africa is the continent with 60% of the world’s renewable energy assets, including solar, wind, geothermal and hydropower. Africa is projected to have 40% of the world’s workforce by 2 100. We have two-thirds of the world’s uncultivated arable land that can transform smart agriculture into the production store of the world. We have the largest carbon sequestration infrastructure in the world,” President Ruto said.

Source: AfDB

Africa

Increased cross-border electricity trade key to universal access in Africa

For Africa to achieve universal electricity access by 2040, a more equitable system must be implemented – one that leverages a diverse mix of the continent’s abundant renewable resources and is dependent upon a more interconnected, flexible and reliable power grid. This was the key message from the International Renewable Energy Agency (IRENA) director general Francesco La Camera to mark an agreement signed with the African Union Development Agency - New Partnership for Africa's Development in support of Africa’s energy goals. The agreement was signed on Monday, 4 September on the margins of Africa Climate Week in Nairobi. IRENA said the agreement is geared toward assisting the continent “in [its] efforts to achieve the African Union’s Agenda 2063 and the United Nations Sustainable Development Goal 7 to ensure access to affordable, reliable, sustainable and modern energy for all. Acknowledging that 80% of the global population without access to electricity resides in sub-Saharan Africa, it is evident that the existing energy infrastructure cannot adequately meet the continent’s needs,” said La Camera. But this would require the creation of a more equitable energy system, he said. 

Source: ESI Africa

East / Southern Africa

Inaugural COMESA – GEF climate change project meeting conducted

The first Common Market for Eastern and Southern Africa (COMESA) Climate Change Programme Steering Committee meeting for the Global Environment Facility (GEF) – funded Capacity Building Initiative for enhanced Transparency (COMESA-CBIT) Project took place on Tuesday, 5 September 2023 on the margins of the Africa Climate Summit and Africa Climate Week in Nairobi, Kenya. The project is supporting four COMESA member states; Eritrea, Comoros, Seychelles, and Zambia, to build capacity for enhanced transparency in climate change monitoring, reporting and verification as defined in the Paris Agreement. It brought together a diverse group of stakeholders and experts who play pivotal roles in shaping the direction and success of the COMESA-CBIT Project. They included government officials from Comoros, Seychelles and Zambia as well as representatives from Conservation International and Regional Centre for Mapping of Resources for Development. COMESA assistant secretary general in charge of Programmes, Ambassador Dr Mohammed Kadah, chaired the meeting, which provided an opportunity to establish a collaborative framework and a shared vision for the project.

Source: COMESA

Angola

IMF Executive Board concludes first Post Financing Assessment discussions with Angola

On 29 August 2023, the Executive Board of the International Monetary Fund (IMF) concluded the Post Financing Assessment (PFA), and endorsed the staff appraisal on a lapse-of-time basis. Angola’s capacity to repay the IMF is adequate, despite elevated risks. Successful reforms coupled by firmed oil prices supported Angola’s economic recovery in 2021–22, however, declined oil production has led to significant challenges to the economy. Towards the end of 2022 and the first half of 2023, the oil sector weakened due to the extension of temporary maintenance operations. With declines of both oil prices and production in the first half of 2023, exports and oil revenues declined, resulting in a weakness in the fiscal and external sectors, and a significant depreciation in the nominal exchange rate in June 2023. Following the strong nominal exchange rate depreciation and the partial removal of fuel subsidies, inflation increased in June, to 11.3% (from 10.6%), for the first time in 15 consecutive months; whereby the Banco Nacional de Angola responded by tightening liquidity conditions. Growth is expected to slow down to 0.9% in 2023 (due to an estimated weak oil production this year), before stabilising at around 3.4% in the medium term, aided by the authorities’ structural reform and diversification agenda. 

Source: IMF

Eritrea

Eritrea’s Msilam Dam to bolster food security and change lives for the better

In the space of three years, Eritrea harnessed local engineering talent and mobilised thousands of Eritreans, including students from the country’s technical and vocational schools, to build the Msilam Dam. The dam has a capacity of 350 million cubic metres and provides clean water to the towns of Dekemhare, Debarwa, Mendefera, and smaller surrounding towns. The Eritrean Government funded and built the Msilam Dam, located in the village of Gergera. Following this success, the country also built the Adi Halo Dam. Eritrea is now looking to trusted partners like the African Development Bank (AfDB) Group to scale up this innovative project. The AfDB president Dr Akinwumi Adesina said that Eritrea’s Msilam Dam and the Adi Halo Dam Water Project – harnessing the power of commercial agriculture and food production – could potentially host the AfDB’s Special Agro-Industrial Processing Zones initiative. The AfDB’s president said the proposed Special Agro-Industrial Processing Zones would mean the AfDB could build on the infrastructure already in place and bring in support to develop food and agricultural businesses that process and package food, fruit, horticultural production, and even floriculture for regional and export markets. Adesina assured the Eritrean leader that the AfDB would support his country in developing a financial system that supports agro-industrialisation. He said he also recognised the potential of the local private sector and the Eritrean diaspora to accelerate investment in the country’s development.

Source: AfDB

Kenya

Kenya unveils Green Hydrogen Strategy and Roadmap

The Government of Kenya led by President William Ruto and president of the European Commission Ursula von der Leyen launched the Green Hydrogen Strategy and Roadmap for Kenya. The unveiling of the programme was done at the Africa Climate Summit held in Nairobi and is a significant development in Kenya’s efforts to address climate change and promote sustainable development. It aligns with global efforts to combat climate change, particularly in the lead-up to the Global Stocktake of climate progress. The Green Hydrogen Strategy and Roadmap for Kenya will be a collaboration of Kenya with the European Commission, specifically through the Global Gateway initiative, which focuses on global sustainability investments. The roadmap outlines Kenya’s ambitions for the green hydrogen sector over the next decade and beyond. It covers areas such as domestic market development, exports, emission reduction goals, job creation, and direct investments. Green hydrogen is considered a key component of the transition to clean energy. The European Union is providing nearly USD13-million in grants to stimulate both public and private investments in Kenya’s green hydrogen industry. 

Source: Pumps Africa

Kenya

Safaricom inks deal with a consortium of Kenyan banks to fund sustainability agenda

Safaricom has announced the closure of a multi-billion Sustainability Linked Loan (SLL) to strengthen its environmental, social and governance (ESG) agenda. The KES15-billion deal, which is upscalable to KES20-billion by accordion, is the largest ESG linked loan facility ever undertaken in East Africa, and the first of its kind for Safaricom as well as the first Kenya shilling denominated SLL in the market. “In line with our focus to advance our sustainable business agenda, this funding will unlock our ability to create more diversified investments that will support transformative investments in new technologies, systems and services that allow us to comprehensively manage our ESG footprint,” said Peter Ndegwa, CEO, Safaricom PLC. The investment is also expected to contribute to the growth of Kenya’s sustainable financing market, which remains a key priority for the Government of Kenya as part of its Vision 2030 plans. “This deal is a significant milestone for Safaricom as it aligns our financial strategy with our sustainability agenda, a reflection of our commitment to transforming lives by partnering for growth,” Mr Ndegwa said. 

Source: Safaricom

Kenya

The Climate Change Amendment Bill is now law

On 1 September 2023, President William Ruto assented to the Climate Change (Amendment) Bill (National Assembly Bill No. 42 of 2023), which amends the Climate Change Act, No. 11 of 2016.  Please see our previous article summarising the Bill here. The Climate Change Amendment Act (No. 9 of 2023), as it is now called, comes into force on 15 September 2023. The amended Act regulates Kenya’s participation in domestic and international carbon markets. In addition to the amendments that were first published in the Climate Change (Amendment) Bill, the Climate Change (Amendment) Act now includes a provision on punitive measures for any person who: willingly conducts unauthorised trade in carbon credits; knowingly gives false or misleading information with respect to environmental or financial gains from the carbon market investment; manipulates carbon credit measurements in order to claim addition measurements; engages in money laundering through carbon trading; knowingly sells carbon credits to unauthorised entities; and fails to maintain carbon records. The Act states that such a person will be liable, on conviction, to a fine not exceeding KES500-million (approximately USD5-million) or to imprisonment for a period not exceeding 10 years, or both.

Source: ENS

Kenya / Democratic Republic of the Congo

Kenya nationals to visit DRC visa free

The Democratic Republic of the Congo (DRC) on Wednesday, 6 September lifted visa restrictions on Kenyans, reciprocating to a gesture by Nairobi announced five days earlier. The Directorate General of Migration in the DRC said the move, in fact, was effective on the same day Kenya lifted its visa requirements on Congolese on 1 September 2023. A circular publicised on Wednesday, 6 September by the Directorate said Kenyan nationals will no longer be required to get visas before travelling to the DRC. This is a new policy between the DRC and Kenya, both sides say, is to facilitate the movement of people for better integration into the East African Community to which both countries belong. The DRC says this could also offer an opportunity to increase trade with Kenya through which it imports goods to eastern regions of the country. With the size of 2.4 million km2 and a population of 100 million, the DRC has been seen by Kenya as a potential market for its banking sector, and other sectors such as transportation. 

Source: The EastAfrican

Kenya / Tanzania

Kenya to generate power using Tanzanian gas

Kenya has sold former oil refinery, Kenya Petroleum Refineries Limited (KPRL), to the state-owned Kenya Pipeline Company (KPC), paving the way for the facility’s conversion into a gas-to-power plant. The transaction will enable the rehabilitation of the refinery – which has been inactive for over 10 years – so that it is equipped to generate power from liquefied natural gas imported from Tanzania. The sale follows the completion of a feasibility study conducted by the United States-based engineering firm K&M Advisors on the capacity and cost-effectiveness of generating power using imported gas. “The defunct KPRL will now be under KPC and the Mombasa-Dar es Salaam pipeline project is key to feeding into the facility to ensure maximum use. We hope once the 30 000 metric-tonnes gas facility is complete, the project will move to the next stage,” stated Davis Chirchir, Cabinet Secretary for Energy and Petroleum in Kenya. With both the study and transaction complete, the respective governments will proceed with finalising the signing of a transnational agreement for the construction of a gas pipeline linking Tanzania’s Tanga facility with the renovated Kenyan refinery.

Source: Energy Capital & Power

Namibia

Green accountability: A crucial yardstick for making the green economy work

Experts estimate that globally, USD100-billion of climate finance is being lost through a lack of accountability, transparency and participation per year. As such, there is growing public demand for access to information relating to the Namibian Government and its role in just renewable energy and green hydrogen projects. It is also vital for development finance institutions, institutional investors, governments and developers to pull together and upscale conversations around green accountability. Global spend on climate change is nearing USD2.4-trillion annually and so high standards of accountability and transparency are essential to avoid corruption and mismanagement and to ramp up the just renewable energy and green hydrogen industry. In addition, to optimise the benefit of investments into the green economy, transparency, equity, and inclusion must be at the heart of renewable energy and green hydrogen finance decision-making. 

Source: ENS

Namibia

Namibia’s green economy: the potential of guarantees in blended (project) financing

As countries around the world move to decarbonise in line with Paris Agreement commitments, governments are recognising the pivotal role to be played by private capital in meeting growing funding requirements. Approximately USD2.4-trillion is needed each year between now and 2050 for climate action just in emerging markets and developing economies (excluding China) (EMDEs). To meet this drastic increase in demand, a significant number of projects must become operational in EMDEs such as Namibia and South Africa where conditions for production are favourable. One of the ways to unlock additional capital for investments into EMDEs is through blended finance, which uses public or philanthropic development capital to attract and enable private finance for Sustainable Development Goal (SDG)-related investments. SDG-related investments in EMDEs may struggle to attract the requisite funding from the private sector for various reasons: the projects are not always able to offer the return on capital required by private capital; the real or perceived risk relating to the country in which the project is undertaken; the lack of balance sheet or credit support which the project is able to offer, or the requirement for a longer tenor of funding.

Source: ENS

Namibia

NamRA clarifies import procedures for goods from non-SACU member states

Importing goods from non-Southern African Customs Union (SACU) member states into Namibia involves a series of procedures and regulations governed by the Customs and Excise Act, 1998 (Act No. 20 of 1998). In a notice, the Namibia Revenue Agency (NamRA) said regulations aim to ensure transparency, tax compliance, and adherence to health and environmental standards. Navigating these importation procedures is crucial for ensuring compliance with Namibia’s customs regulations and fostering trade while protecting public health and the environment. Importers and travellers are encouraged to familiarise themselves with these regulations to facilitate smooth and lawful importation processes. In accordance with the Customs and Excise Act (section 40(2)(e)), commercial goods valued at NAD500 or more that attract duties as per Schedule 1 must be paid upon importation into SACU. For example, when importing dry wild berries (eembe) or bird plum (scientific name: berchemia discolor) under HS code 0813.40.00 for commercial purposes from outside SACU, the importer is subject to a 10% general rate of customs duty. Informal traders, however, must pay the normal rate of 10% customs duties and 16.5% value-added tax or opt for a 20% flat rate based on the imported goods’ value.

Source: Windhoek Observer

Nigeria

Stakeholders lament complex export levy, documentation

Stakeholders have lamented what they described as extremely complex export procedures and documentation processes by numerous government agencies in Lagos State. This is even as they urged the federal government to scrap export levy collections on agricultural products and collection of registration charges on Domestic Export Warehouses (DEWs). The former chairman of the Export Group of the Nigerian Association of Chamber of Commerce, Industries, Mines and Agriculture, Kola Awe, said there is an imposition of export levy of USD5 for five different cargoes, including cocoa, ginger, cotton and rubber, while every other one is USD15. Awe also noted that exporters are avoiding taking their goods to the established government export warehouses because of the export levies. He said the cost of registering at the export warehouses is expensive while calling on the government to make it lower so that exporters can be encouraged to use it. Awe, who is also the CEO of XPT Logistics, called for the harmonisation of all agencies to have a seamless transaction, which he said has become an issue. Our ports are not yet paperless. When it comes to the examination side, the same number of agencies are there. It impedes the whole essence of global best practices and competitiveness, the processes are extremely too much,” he stated.

Source: The Guardian

Sierra Leone / Kenya

Sierra Leone intends to replicate Kenya’s climate action initiative

The President of Sierra Leone, Dr Julius Maada Bio, has lauded the launch of Kenya’s Financing Locally Led Climate Action (FLLoCA) programme, as part of his engagement at the ongoing Africa Climate Summit in Nairobi. “I wish to congratulate my dear brother and friend, President William Ruto, for successfully launching this innovative initiative ─ a great example of a homegrown solution to a homegrown problem. There is a cliché that every politics is local. It is also true that climate impacts are local and affect the most vulnerable people in communities and far-off localities,” said President Bio. “I intend to replicate the Government of Kenya’s FLLoCA initiative in Sierra Leone to strengthen our 446 wards. I look forward to bilateral, South-South cooperation with our friends in Kenya to undertake the necessary assessments and formulation of a similar programme in the near future. We hope our donor partners will be encouraged to support this learning model among African countries. Such cooperation could shorten the time for the design of various programmes. It could also help countries move faster into developing bankable projects to crowd in more significant private investment flow,” he said. 

Source: ESI Africa

Uganda

Parliament reconsiders and passes the Competition Act 2023

On 31 August 2023, the Parliament of Uganda reconsidered and passed the Competition Act 2023. The Act, first passed in May of this year, was returned to Parliament by President Yoweri Museveni for reconsideration of the Act’s administrative mechanism. The government had recommended that the Act be administered by a technical committee under the Ministry of Trade, Industry and Cooperatives. However, Uganda's Parliament rejected this recommendation and instead provided for an independent Competition and Consumer Protection Commission. In returning the Bill, President Museveni queried the creation of a commission saying that the creation of new statutory authorities was contrary to the government’s current rationalisation policy. In reconsidering the Bill, the Parliamentary Committee on Tourism, Trade and Industry made a strong case for an independent competition commission. The committee argued that the competition law applied to all persons and sectors of the economy including government. A conflict of interest would therefore only arise if the government was to administer a law that it was itself subject to. Public confidence in the law would also be boosted by an independent commission. The committee also pointed out that an independent commission was best practice in the neighbouring countries of Rwanda, Tanzania, Kenya and Zambia.

Source: ENS