Earlier this week, Nigerian President Muhammadu Buhari announced the launch of the US$2.8 billion Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline project, which he promised would significantly improve power generation for domestic use and gas-based industries. In addition, the pipeline is anticipated to bring both greater infrastructure investment and employment to towns along the pipeline’s route, benefitting the provinces of Kano, Kaduna, Niger, Abuja, and Kogi State.
Nigeria has begun work on the first 200 kilometers of the 614-kilometer-long AKK pipeline route, which forms part of the planned 1,300-kilometer-long Trans-Nigeria Gas Pipeline, a project largely financed by China Export & Credit Insurance Corporation and several Chinese banks.
Nigeria formally joined China’s Belt and Road Initiative in February 2019
Buhari’s promise of economic prosperity arising from this project underscores Nigeria’s slumping energy industry and regular power outages despite being Africa’s largest oil producer. The COVID-19 pandemic in particular took a heavy toll on the industry: at the conclusion of the first half of the 2020 fiscal year, oil and gas companies listed on the Nigerian Stock Exchange reported a loss of about US$457.8 million.
China’s strong presence on this project reflects its broader infrastructure diplomacy in Africa, enacted through its Belt and Road Initiative, which Nigeria formally joined in February 2019.
Ethiopia wants to start filling the Grand Ethiopian Renaissance Dam (GERD) in the Blue Nile in July, when the rainy season starts, but it has not yet reached a final agreement with Egypt and Sudan downriver. Egypt fears it would reduce its water supply, and Sudan warned on Wednesday that the filling of the GERD without an agreement between the three countries would pose a risk to its own dams. Sudan is especially concerned about Roseires Dam near the Ethiopian border, which plays an important role in supplying the country with water and hydroelectric power.
The latest round of negotiations also failed to produce a compromise
Consultations have been ongoing between the three countries, with input from the World Bank and the United States. Most issues have been resolved, but the remaining bones of contention are the fill rate of the 74 billion cubic meter reservoir and the long-term operation of the dam.
The latest round of negotiations, by videoconference, also failed to produce a compromise. On June 19, Egypt requested the United Nations Security Council (UNSC) to intervene to resolve the dispute with Ethiopia, after which Sudan sent a letter to the UNSC expressing its concern over the filling of the dam without a signed agreement. The UNSC will discuss the issue on Monday, June 29.
And the African Union’s Executive Council will hold an emergency video meeting on Friday, June 26, to discuss the dispute in response to a call from South African president Cyril Ramaphosa, the current chairman of the African Union.
Ghana recently completed phase one of a three-part process to develop the infrastructure for producing nuclear power in coordination with the International Atomic Energy Agency. The focus of the first phase was on conducting a series of studies on the rationale for and feasibility of introducing nuclear power to the national and West African energy grid, a tall order considering the steep costs of constructing and maintaining nuclear reactors.
Ghana’s current installed generating capacity of 4,132 MW comprises hydroelectric power (38 percent); thermal power fueled by oil, natural gas and diesel (61 percent); and solar power (1 percent). Actual availability, however, rarely exceeds 2,400 MW due to various factors, including inadequate fuel supplies. To meet the energy demands of its growing population, currently at about 28 million, requires the country to rely on the broader West African energy grid to supplement the shortfall.
Phase Two of the nuclear plan will include meetings with potential stakeholders, developing a government financing scheme and a framework for nuclear waste disposal protocols, and determining suitable sites for construction. Dr. Robert B. M. Sogbadjie, coordinator of the Ghana Nuclear Power Program, confirmed during a press conference that four sites have already been picked out, but did not disclose their locations. Phase two is anticipated to begin in 2024, with construction to be completed by 2030.
South Africa has had a nuclear power plant since 1984
Should Ghana succeed in this endeavor, it would make it only the second country in Africa to have nuclear power, alongside South Africa, which has had a functioning nuclear power plant—providing 5 percent of the country’s total energy output—since 1984. Furthermore, Ghana’s initiative on nuclear power could incentivize other African nations to do so as well, moving the continent away from fossil fuels while meeting the energy needs of a growing population.
Algeria finds itself at a critical crossroad in terms of both its political and economic outlook. Already suffering from the fallout from the Saudi-Russian crude oil price war, the Algerian economy has been further hammered by the COVID-19 pandemic, and is projected to shrink by 5.2 percent in 2020.
The administration of President Abdelmadjid Tebboune, elected in December 2019 after mass protests forced his predecessor, Abdelaziz Bouteflika, to step down, has introduced reform measures, but opposition political parties and the grassroots Hirak movement derided them as insufficient even before the government announced an indefinite suspension of the program due to the pandemic.
The situation in Algeria is of serious concern to Europe. The country is a major supplier of natural gas for the continent, and it is a popular point of departure for economic migrants and asylum-seekers along the western Mediterranean passage to Europe. As the pandemic further constricts the more precarious economies in sub-Saharan Africa, coupled with displacement caused by terrorism in the Sahel, the likelihood of Algeria—and by extension Europe—seeing an influx of refugees is growing.
China Has Taken an Interest
China has been increasing its engagement and influence in North Africa as part of the country's Belt and Road Initiative (BRI). In Algeria, China has quickly become a principal creditor and trade partner, supplanting France as the country’s primary commercial investment partner for infrastructure projects.
President Tebboune's government will have to choose to either reform or buy social peace; this time not with oil returns but with Chinese loans.
The Beninese government has taken great strides in its goal of expanding access to drinking water to about 4.5 million people living in rural areas. The authorities recently created the National Rural Drinking Water Supply Agency, and on May 20 the cabinet approved the signing of agreements between the agency and the country’s seventy-seven municipalities.
The federal government has set the goal for itself of achieving universal access to clean water by 2021, nine years before the deadline set by the United Nations to achieve the Sustainable Development Goals. Among others, the authorities say six projects are in progress in rural areas, including the sinking of about 200 boreholes, that are expected to benefit more than 220,000 people.
Benin has demonstrated some of the more effective water management programs in West Africa
Despite regional disparities in terms of access to potable water and a noticeable urban-rural divide, Benin has demonstrated some of the more effective water management programs in West Africa. A 2011 country status overview report from the African Ministers’ Council on Water found that Benin would reach 73 percent total coverage by 2015 (which it ultimately exceeded back in 2012), a marked improvement from 51 percent at the end of 2008.
Whereas access to drinking water has greatly improved, Benin still lags behind in ensuring sanitation services for all its people, which will require greater financial investment from the government and international donors to reach the targets of the Sustainable Development Goals.
A Sudanese ministerial delegation sat down with Ethiopian prime minister Abiy Ahmed in Addis Ababa over the weekend to discuss the filling of the Grand Ethiopian Renaissance Dam (GERD) and border security concerns. The delegation follows a phone conversation between Abiy and Sudanese prime minister Abdallah Hamdok on May 12, when the latter urged his Ethiopian counterpart to agree to a tripartite deal between Sudan, Ethiopia, and Egypt before beginning the filling process.
The GERD fulfills a decades-long Ethiopian dream to harness the power of the Nile River to meet the country’s ballooning energy needs for its 109 million-strong population. Egypt, however, is concerned that a hasty filling of the dam could lower the Nile’s water level and jeopardize its agricultural industry, with Sudan fearing the dam will exacerbate issues of water shortages.
Filling of the dam is set to begin on July 17.
A day after Hamdok’s call to Abyi, Sudan announced it would not sign a partial deal due to a lack of technical and legal articles in the agreement, which Ethiopia has criticized as an undue burden. Filling of the dam is set to begin on July 17.
Other Matters on the Agenda
Outside of discussions on the GERD, the Sudanese delegation and Ethiopia discussed issues of trade, mitigating the spread of the COVID-19 pandemic, and ongoing attacks between Sudanese farmers and Ethiopian militias in Sudan’s eastern Gedaref Governorate. Ethiopian forces recently occupied parts of this governorate, threatening to reignite a border dispute that was resolved in 2003 after Ethiopia formally returned the territory to Sudan.
A multinational consortium of telecommunications companies—including Facebook, China Mobile International, MTN Global Connect, Telecom Egypt, and Vodafone—announced the construction of a new undersea fiber-optic cable that will connect sixteen African countries, Europe, and the Middle East. Named 2Africa, the 37,000 kilometer-long communications cable is scheduled to go live in 2023 or 2024.
Africans pay some of the highest data rates in the world.
In March, two undersea cables serving Africa experienced breakages that drastically reduced Internet connectivity for days as repairs were made. The addition of 2Africa will help improve Internet access for millions of Africans, and mitigate disruptions should other cables experience failures in the future. Such disruptions are not only frustrating for Africans, who pay some of the highest data rates in the world, but also have a negative impact on the African economy.
A 2017 report by the Collaboration on International ICT Policy for East and Southern Africa (CIPESA) concluded that intentional Internet shutdowns in twelve countries between 2015 and 2017 cost sub-Saharan Africa more than US$237 million. Unforeseen connectivity disruptions naturally can have far greater negative impact on national and regional economies.
The Reserve Bank of Zimbabwe (RBZ) has accused mobile money platform EcoCash of playing a role in the rapid devaluation of the country’s currency, and characterizing it as a “Ponzi scheme” in court documents. This about-face comes after the RBZ recently released figures showing that mobile money transfers made up the bulk of Zimbabwe’s National Payment System, the financial mechanism used by the Reserve Bank to manage commercial and financial transactions.
With more than 11 million users, EcoCash is the dominant phone-based money transfer system in Zimbabwe.
This has not stopped regulators from alleging that EcoCash has been committing illegal currency dealings by allowing its agents to have an overdraft on their EcoCash accounts, funds the bank believes are used to buy foreign currency and artificially inflate the exchange rate.
Zimbabwe’s financial woes are compounded by international sanctions.
Millions of Zimbabweans have come to depend on mobile money wallets to handle not only digital payments but also salaries and remittances. The convenience of digital cash has made it popular in the country’s informal economy sector—the largest in Africa and second-largest in the world—but it also comes with its own set of risks, namely the difficulty in acquiring hard currency due to exorbitant commissions charged by these mobile money platforms.
Even before the COVID-19 pandemic, Zimbabwe’s financial woes are compounded by a famine in the north threatening millions and international sanctions. African Union chair Cyril Ramaphosa has been urging the G20, the International Monetary Fund, and the World Bank to lift sanctions on Zimbabwe to help the nation deal with the pandemic.
The government of Ghana believes that investment in railway infrastructure will put the country on the fast track to economic development.
Construction on the first railway line in Ghana started in 1898, when the country was under British colonial rule. The line—between Tarkwa, a gold-mining center, and Sekondi on the coast—opened in 1901, and in the next two years it was extended north from Tarkwa to Kumasi, the capital of the Ashanti region.
When Ghana gained independence in 1957, it had a rail network of nearly 1,000 kilometers, but today only about a sixth of it remains in operation. Derailments and slow speeds are a common occurrence.
In December 2013, the government of Ghana released a railway master plan, setting out six phases of development. Targets included the rehabilitation of the existing narrow-gauge network, and the construction of new lines—built to standard-gauge specification—to link all regional capitals and ultimately connect Ghana with its neighbors, Côte d’Ivoire, Burkina Faso, and Togo. This would add more than 4,000 kilometers of track to the network, at a projected cost of US$23 billion.
The plan has received the support of successive administrations.
In 2017, President Nana Akufo-Addo established the Ghana Rail Authority by removing the components of the Ministry of Transport related to railways. The newly formed Ministry of Railway Development has two implementing agencies, the Ghana Railway Development Authority (GRDA) and the Ghana Railway Company Ltd (GRCL), the owner of the rail infrastructure and the operator of the railway routes, respectively.
The first phase of the plan involved completing priority projects over a four-year period from July 2016 to July 2020. The rehabilitation of the line between Accra and the Port of Tema has been completed, and the route reopened in January with a passenger service for 600 people. The line also links free zones in the area to the sea port, with some facilities specifically designed to take advantage of the railway link between the two cities.
The Takoradi–Tarkwa line is currently in development.
Earlier this year, South African state-owned rail and freight operator Transnet signed an agreement with the GRDA and the GRCL to develop a 66-kilometer standard-gauge railway line alongside the existing line in the Western region, between Takoradi and Tarkwa. The line is crucial for transporting freight, mostly for the mining and agriculture sectors.
Not all of the key investment in Ghana’s railway service has come from the government. Private sector initiatives, such as the completion of the first domestic facility for the production of concrete railway sleepers (as opposed to wooden sleepers) suggest that private companies are positioning themselves to take advantage of the railway boom.
Additional financing sourced through build-own-operate-transfer agreements, barter agreements, and public-private partnerships is integral to the success of the plan, says Richard Dombo, CEO of the GRDA. There has also been considerable international appetite for rail investment in the country. They have had discussions, for example, with steel producer ArcelorMittal about the right to extract iron ore at Sheini to a value equal to the cost of constructing a rail link between the mine and the coast for exporting the ore.
Ghana’s railway lines have historically been “engines of growth”, Dombo says, and the transport sector remains crucial for future development.
A Senegalese fishing association has been fighting a campaign to block the licensing of fifty-three foreign trawlers, most of which are Chinese-owned, that would allow them to fish within Senegal’s exclusive economic zone. The campaign is led by GAIPES, the Senegalese Association of Fishing Companies and Ship Owners, whose head, Alassane Dieng, argues that these foreign trawlers pose a threat to the local fishing economy.
Foreign trawlers are responsible for large-scale illegal fishing operations.
Unfortunately, this is hardly a new issue. Massive trawlers that can catch much more fish in a day than artisanal fishermen can haul in a year have depleted fish stocks off the Senegalese coast. In a country where one in five people depend on the fishing industry to support themselves, the presence of these mega-trawlers poses a grave economic threat to some of Senegal’s poorest citizens. Foreign trawlers are also responsible for large-scale illegal fishing operations, costing Senegal more than US$270 million in lost revenue every year.
Though these vessels hail from Europe and Russia as well, as of late China has become an increasing presence in African fishing waters, threatening to undermine China’s diplomatic and infrastructure investments in the region. Recently, however, the government of China has begun to punish vessels engaging in illegal, unreported, and unregulated fishing, revoking distant-water fishing licenses, cancelling subsidies, and blacklisting certain captains and company owners caught violating fishing regulations.