2. Political, Economic and Environmental Challenges in Africa:
OGUNLADE R DAVIDSON
Director, EDRC
Lecture at Protestant Academy , Mulheim International Network of Engineers and Scientists for Global Responsibility (INES) March 1, 2002
Energy & Development Research Centre University of Cape Town

3. Contents of Presentation
Introduction
Political Challenges
Economic Challenges
Environmental challenges
Prospects for Africa –Sustainable development
Opportunities in the Energy sector
Conclusions

4. Countries of Africa Algeria Libya Niger Chad Sudan Ethiopia Somalia
Cantral
African Rep.
Nigeria
Tunisia
Mali
Burkina
Faso
D R Congo
Kenya
Uganda
Rep.
Congo
Angola
Mozambique
Tanzania
Malawi
Zambia
Zimbabwe
Botswana
Namibia
South Africa
Lesotho
Swaziland
Cameroun
Mauritania
Western
Sahara
Senegal
Guinea-Bissau
Guinea
Liberia
Cote
d’Ivoire
Ghana
Togo
Benin
Egypt
Burundi
Eq. Guinea
Gabon
Cabinda
Eritrea
Djibouti
Madagascar
Mauritius
Seychelles
The Gambia
Rwanda
Countries of Africa

5. Historical Impoverishment of Africa
Inhuman slavery, colonial legacy, and cold war proxy
Political independence with economic structures that fail to cope with the global economic system
Destroyed existing structures - weak capitalist class and acute shortage of required skilled manpower - result in weak states
Contribution to the world economy - supplier of cheap raw materials and consumer of manufactured goods
No major infusion of financial investments

6. Failure after Political Independence
Countries fail to empower its people for wealth creation, industrial and entrepreneurial initiatives –loss of creative potential
The spirit that led to call independence and the setting up of OAU lost
Weak states resulted in military coups - triggered by Ghana in 1966
Education investments at wake of independence (25% of GDP), but beneficiaries stayed away
Economic decline, reduced capacities and poor governance reinforcing each other

7. Resources of Africa
Huge mineral, oil and gas deposits, flora and fauna and unspoiled natural habitat. Basis for mining, agriculture and tourism – Features most known
Ecological assets of rain forests and minimum industrial pollution – benefit to mankind
Sites of paleontology and archaeology that describes the evolution of man – scientific acceptance
A variety of rich cultures that can benefit humans

8. Environmental Challenges
Land degradation and desertification (food security)
Protection and sustainable use of forests
Effective management and protection of biodiversity – rich biodiversity and grasslands with home for wildlife but only 2-3% global tourism
Water management and scarcity – decreasing rainfall and high dependence on ground water
Land, air and water pollution – rich fishing grounds but serious pollution problems

9. Integral Elements of Sustainable Development

10. Many definitions but useful to think of SD in terms of challenges:
What is sustainable development?
Many definitions but useful to think of SD in terms of challenges:
Clean air
Transport
Clean water
Housing
Food
Jobs
Energy
Waste disposal
Land use
Health care

11. Annual GDP growth of Africa, 1992-19995 4 3
Annual (%) 2 1 -1
1992
1993
1994
1995
1996
1997
1998
1999

12. Comparison of rates of return and net private flows to developing regions, 199640 70 35 60 30 50 25
Net private investment
Rate of return (%) 40
flows (%) 20 30 15 10 20 5 10
Africa
L.America
Asia

13. Energy - Development
Africa requires substantial energy supplies to satisfy its basic and development needs
Increasing demand for rural energy access
Rural areas areas are deprived of modern energy services
Dilemma: increase fuelwood difficult due to supply problems and lack of infrastructure for modern energy supply
Satisfying urban demand very challenging
Energy needs of the urban poor significant
Urbanization rate is twice national growth rates
Growing number of cities with population over 1 million
Growing demand for urban lifestyle and modern energy services

14. Energy Sources of Africa
Africa has diverse and abundant share of global fossil and renewable energy resources
6.2% of Coal, 7.7% of Oil and 7.2% of Nat.Gas
Few Geothermal sources in East
12% Hydro, East, Central & West
Large quantities of biomass, solar and wind in selected areas
Nearly all these resources are under exploited
Significant economic, technical and environmental constraints
Only area globally with growing new oil and gas finds

15. Growth in selected energy parameters, 1980-952
1.9
1980=1.0
Electricity
Generation
1.8
1.7
Modern Energy
Consumption
1.6
Population
1.5
1.4
Modern Energy
Production
1.3
GDP
1.2
Woodfuel
Consumption
1.1 1
1980
1985
1990
1995
Source: Base data from OECD & FAO

17. Environmentally Friendly Energy Future
Expanded energy services: basic parameters:
Social Equity
Economic viability
Environmentally sound
Institutional cohesiveness
Diversity of Institutions and financial schemes
Widening access at increased efficiency
Development of a portfolio of technology options
Market creation and stimulation: urban and rural
Development of non-energy sectors: agriculture, telecommunications, transport, etc..

18. Policy Concerns: International Cooperation
Improving climate for investments not yet tapped
High growth rates and Highest rate of return on investments
Declining ODA and low share of FDI, but ODA can provide leverage fund support for many African countries
Assist creating environment for attracting investments
Institutional reform
Regulations, standards and system of arbitration
Develop local business sector
Support new alliances of public/private partnerships

19. Conclusions Economic-Environment-Development Challenges
Moving out of Poverty
High dependence on natural resources
Positive economic trends
3% growth in GDP since 1995
Highest rate of return on investments
Renewed interest in African Affairs
Development of NEPAD
New thinking in financial system - World Bank
Recent EU initiative
IMPROVED POSITIVE IMAGE OF AFRICA URGENTLY REQUIRED

20. THANK YOU ALL FOR LISTENING