Cameroon Firms Look to Hydro to Help Close the Power Gap

Published: 12 January 2010 y., Tuesday

Elektros lemputės
Basile Nkwesi, Directeur Commercial of Multiprint, speaks for dozens of frustrated business managers in this busy enterprise center when he talks about Cameroon’s costly and unreliable electricity.

Power outages interrupt the printing process, impair equipment, and cause delays and cost overruns for customers.

“It’s an enormous constraint,” he says. “We lose clients to Asian competitors, because despite the distance, they’re more competitive.”

Like virtually all companies in the country, Multiprint backstops itself with a diesel-powered generator—one of the most expensive and inefficient solutions to power supply.

And when clients take their business elsewhere, it’s harder to expand, invest or recruit. In fact, Multiprint has cut its workforce to about 115 from 200 over the past two years. 

Inadequate power to support a more diverse and competitive private sector is one of the principle factors accounting for Cameroon’s sluggish economic growth, which falls far short of the seven percent annual growth the country needs to achieve the Millennium Development Goals, or to reach the government’s goal of attaining middle-income status by 2035.

Graphics System, another printing company here, operates a network of production houses,  but 15 days out of every month, there is a power outage somewhere in the system. Energy costs chew up about 10 percent of revenue, estimates Jean-Luc le Gall, Directeur General.  

When businesses in Cameroon are surveyed about constraints to doing business, 67 percent of the manufacturing firms cite limited access to and high costs of electricity as among the top five constraints they face.

“The energy problem is a problem for the whole economy,” says Justin Fotsing, chief economist of Groupement Inter-Patronal du Cameroun.  

Said ou Abdoulai Bobboy, at the Cameroon Chambre de Commerce argues that with “the huge investment in private generators” and the associated costs, investments are routinely postponed or shelved. “Projects founder or stall because of the fear of inadequate electricity,” he says.

To address the power gap, the government has called for the development of its hydropower potential, among the largest in Sub Saharan Africa.  The anchor project in this strategy is the Lom Pangar Hydropower Project, a regulating dam on the Sanaga River that could support additional hydropower generation of as much as 6000 MW.

Private sector leaders say they applaud the project. Their main worry is that it won’t come on soon enough to provide near-term relief from high production costs. 

Šaltinis: www.worldbank.org
Copying, publishing, announcing any information from the News.lt portal without written permission of News.lt editorial office is prohibited.

Facebook Comments

New comment


Captcha

Associated articles

The most popular articles

Volcanic ash cloud crisis: Commission outlines response to tackle the impact on air transport

European Commission Vice-President Siim Kallas, responsible for transport, today presented to the College a preliminary assessment of the economic consequences for the air transport industry of the volcanic ash crisis. more »

EU draft budget 2011: The future beyond the crisis

Boosting economic recovery, investing in Europe's youth and in tomorrow's infrastructures are the priorities of the 2011 draft budget adopted by the Commission on 27 April 2010. more »

Vice President Almunia welcomes Visa Europe's proposal to cut interbank fees for debit cards

European Competition Commissioner Joaquín Almunia welcomes proposed commitments by Visa Europe to significantly cut its multilateral interchange fees (MIFs) for debit card payments. more »

Volcano impacts flower business

Because of the Icelandic volcano, flower growers in Colombia couldn't get their stems to markets in Europe. more »

Salgado expresses conviction that all EU countries will support aid for Greece

The Second Vice President of the Spanish government and Minister of Economy and Finance, Elena Salgado, on Sunday played down the importance of apparent fissures within the EU concerning the Greek financial crisis, expressing her confidence that all countries would support the aid package for this country, which will be accompanied by a tough budget-tightening plan. more »

The European conformity mark

Commission launches an information campaign on the CE conformity mark - designed to ease the free movement of goods around Europe and protect consumers. more »

Airport security - who will foot the bill?

If Europe's airports ever open again the introduction of new security measures like body scanners will be expensive. more »

Learning the lessons from Greece

After Eurozone Finance Ministers agreed measures to address Greece’s financial woes last Sunday, MEPs quizzed leading economic figures, including the chairman of Goldman Sachs - former financial advisors to the Greek government - on how to strengthen EU economic governance and improve reporting of national statistics. more »

A new strategic vision for the EU's Tourism Policy

The European Tourism Stakeholders Conference, being held in Madrid today and tomorrow, will explore ways and means to strengthen the visibility of tourism at a European level and to verify how the actions to promote a competitive EU tourism industry. more »

EBRD, IFC, FMO, and ADM Capital Launch Fund to Help Companies in CEE, Central Asia, and Turkey Recover from Crisis

The European Bank for Reconstruction and Development (EBRD), World Bank Group member IFC, and The Netherlands Development Finance Company (FMO) have joined up with the Asia Debt Management Hong Kong (ADM Capital) to establish a regional fund to invest in midsize companies facing financing difficulties as a result of the financial crisis. more »