Electricity Sectors in Angola and Mozambique are Ripe for Investment, Says Frost & Sullivan
The provision of electricity is a fundamental element for the development of other sectors of the economy. These two countries have therefore been upgrading and rehabilitating their electricity infrastructure as result of influx of foreign direct investment (FDI), mainly from China Exim Bank and the World Bank.
“The current regional economic growth, estimated at 6.0 per cent per annum over the next ten years, and environmental concerns are the major drivers for the changes and transformation in the electricity industries in these countries,” says Frost & Sullivan (http://www.energy.frost.com) energy industry manager
The Angolan electricity industry seems to be at a similar stage of its development, with tremendous potential for growth. Despite the global financial meltdown, the current growth demand for electricity is estimated at 12% per annum until 2015.
“The national reconstruction programme is expected to remain a significant driving factor behind this continued surge,” explains
The investment environment in both countries is characterised by bureaucratic procedures in the majority of the government institutions, with high levels of corruption. As a result, international investors have shown some reluctance to invest in these markets.
“Efforts to create an atmosphere conducive for business can however be seen in the reduction of time to open a business and the opening of the electricity industry for private participation,”
Frost & Sullivan expects the current electricity industry reformation to reduce investment barriers significantly. Both countries’ investment laws give foreign and domestic investors equal access to investment incentives and enable the participation of private investor in public infrastructure projects. Given the abundant feedstocks available in these countries, there are clear opportunities for investment.
“The hydro potential of both countries has been estimated at approximately 28 500MW,”
If you are interested in more information on Frost & Sullivan’s analysis of the electricity markets in
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SOURCE Frost & Sullivan