Africa
4:13 am
Wed August 6, 2014

Summit Focuses Investors On Africa's Energy Opportunities

Originally published on Wed August 6, 2014 6:45 am

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Transcript

DAVID GREENE, HOST:

More than 50 African heads of state are here in Washington D.C. for a summit this week.

STEVE INSKEEP, HOST:

President Obama invited them, hoping to highlight Africa's economic potential. In a moment, we'll hear from an African businessman about why it's often difficult to bring foreign investors to Africa.

GREENE: This week, however, the U.S., the World Bank and private companies are announcing billions of dollars in investments. This includes money to fix power grids and give more Africans access to electricity. All part from an initiative from President Obama called Power Africa. NPR' Michele Kelemen was at the summit yesterday.

MICHELE KELEMEN, BYLINE: It was a day of stage-managed photo ops and tightly-choreographed panels with lots of earnest talk about how the U.S. wants to help Africa leap ahead of the developed world with clean energy. Secretary of State John Kerry says many of the leaders he met want to avoid the mistakes of rich countries that rely on fossil fuels.

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JOHN KERRY: Africa can be a clean energy beacon for the world and energy prosperity can actually replace energy poverty.

KELEMEN: Kerry says the U.S. is investing in a wind power project in Senegal and a solar project in Rwanda. The Overseas Private Investment Corporation also signed a $50 million loan to support a natural gas power plant in Africa's most populous nation, Nigeria. The managing director of Azura Power, David Ladipo, says the summit got everyone focused.

DAVID LADIPO: That's the way these things work is it's the deadline of having the summit, which puts pressure on deals, on the private sector, as well as the governmental sector, to say we need to get things done so that we can showcase them at this event.

KELEMEN: His 450-MW power plant would be big for most countries in Africa. But he says for Nigeria, this is a drop in the ocean compared to the country's needs. Still, Ladipo says the deal sends a clear signal that the U.S. government is really behind the transformation of Nigeria's energy sector.

LADIPO: There's a real need for people to take a bold approach to investment in Africa. And I'm coming at it from a finance perspective. Finance, in particular, where everyone wants to mitigate, to the nth degree, every single risk. And it takes years to put together a project finance deal. Now, years are what we don't really have in Africa.

KELEMEN: Nigeria's economy is growing by nearly 8 percent a year, he says. And if more electricity can be generated, he thinks the GDP can rise to up to 10 or 11 percent. That means more business opportunities for Americans. Some experts worry the U.S. is coming to this too late, though. China has invested much more in infrastructure across Africa and without the sort of demands the U.S. makes on countries to reform. GE chief executive officer, Jeffrey Immelt, thinks U.S. companies still have time to catch up.

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JEFFREY IMMELT: We kind of gave Africa to the Europeans first and to the Chinese later. But today, it's wide open for us.

KELEMEN: GE is investing $2 billion in Africa over the next four years. President Obama says the U.S. wants to be a good partner with Africa, taking a dig at China. He said America isn't only interested in extracting minerals.

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PRESIDENT BARACK OBAMA: We don't look to Africa simply for its national resources. We recognize Africa for its greatest resource, which is its people and its talents and their potential.

KELEMEN: President Obama says this week has brought about $12 billion in new funds for Power Africa from the private sector, World Bank and the government of Sweden. The U.S. is contributing $300 million a year, he says, and upping the goal to bring electricity to 60 million African homes and businesses. Michele Kelemen, NPR News, Washington. Transcript provided by NPR, Copyright NPR.