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Africa Faces Massive Poverty and Economic Hardship in the Name of Fighting Climate Change (By NJ Ayuk)

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By NJ Ayuk, Executive Chairman African Energy Chamber (www.EnergyChamber.org).

Organizations ranging from the World Bank to the European Investment Bank (EIB) have dropped support for African fossil fuel production in hopes of encouraging a transition from oil, gas and coal to sustainable energy sources like wind and solar power.

Now there are legitimate concerns that investor support for oil and gas production will dwindle as well. Blackrock, which controls $7 trillion in investments, and the Royal Bank of Scotland have said they’ll be moving away from investments that support fossil fuel production.

The anti-fossil fuel fervor is being demonstrated in what may seem like surprising ways: the Bank of England was criticized for having an oil company executive its board of directors.

Pressure is coming from within the African continent, as well. Western funded NGOs from Kenya and the surrounding region, for example, recently petitioned the African Union to put a stop to coal usage and look into phasing out oil and gas usage over the next three decades in hopes of eliminating emissions that contribute to global warming.

I agree that climate change should be taken seriously, but we cannot accept knee-jerk responses. We must not rob our continent of the significant benefits it can realize from oil and gas operations, from the economic opportunities of monetized natural resources to critically important gas-to-power initiatives.

I am not, by any means, calling for a stop to sustainable energy programs. They are being implemented, and I hope to see more. I’m simply saying it’s too soon for an either-or approach to green energy sources and fossil fuels.

What’s more, it should be Africans, not well-meaning outsiders, who determine when the timing is right to phase out fossil fuels in Africa, if ever. Pressuring Africa to do otherwise is insulting, no better than throwing foreign aid at us with the assumption that Africans are incapable of building a better future for ourselves. It’s also hypocritical for countries and people who enjoy the security, greater life expectancy, comforts and economic opportunities associated with plentiful, reliable energy to say, “Time’s up, Africa. No more fossil fuels for you. Desperate times call for desperate measures.”

What about the desperation that the 600,000-plus Africans without power live with every day?

Is it reasonable to expect them to wait for green energy to evolve while domestic natural gas and crude oil reserves can be exploited to create electricity and heating fuel far more quickly?

Addressing Energy Poverty

We cannot move forward with phasing out fossil fuels in Africa before we address the huge swaths of our continent existing in energy poverty. I strongly agree with the late OPEC Secretary General Mohammed Barkindo, who said in his 2021 address: “The almost one billion people worldwide who currently lack access to electricity and the three billion without modern fuels for cooking are not just statistics on a page. They are real people . . . Nobody should be left behind.”

Closer to home, more than two-thirds of the population of sub-Saharan Africa, more than 620 million people, lack access to electricity. Even more infuriating, that number is likely to increase. The International Energy Agency (IEA) has predicted that by 2040, approximately 75 percent of sub-Saharan Africa will lack access to electricity. Why? Surging populations are far outpacing the spread of infrastructure.

As I wrote in my book, A Just Transition: Making Energy Poverty History with an Energy Mix, living without electricity is much more than an inconvenience. It keeps people from modern health care, and it exposes them to toxic air pollution caused by burning unsafe fuels indoors. It also reinforces poverty and contributes to economic stagnation: Businesses, factories and schools need electricity to function and grow.

I’m convinced that one of our continent’s best chances of eliminating energy poverty is to strategically exploit our abundant natural gas resources instead of exporting and flaring it. Africa had 503.3 trillion cubic feet of proven natural gas reserves available to us as of 2024. Natural gas can be used to fuel electricity generation: It’s available; it produces less carbon dioxide emissions than diesel, gasoline or coal; and it’s affordable. In fact, its price recently fell. What’s more, natural gas can be integrated with wind and solar power to produce energy that’s both sustainable and reliable.

While gas-to-power will require effort, from the creation of intra-African trade agreements that make natural gas available to countries without it to cooperation from power producers, it represents a very doable way for Africans to resolve one of the continent’s greatest challenges.

In addition, Namibia has seen some amazing discoveries by TotalEnergies, Shell, and Galp Energia. Greenfield spending — that is, foreign direct investment in new projects — is being driven by Mauritania, Senegal, Uganda, Congo, Mozambique, Ghana, Angola, and Cote d’Ivoire. With that in mind, this is a horrible time to stop producing and using natural gas in Africa. This is why African Energy Week is important because it represents where Africans stand on energy and their future. The game has changed.

African Companies, Monetization and Economic Growth

Phasing out fossil fuels in Africa also would be harmful to the many international and indigenous oil and gas companies that contribute to the continent’s revenues and make a positive social impact here.  I’ve written extensively about companies that do real good for African communities, such as Oando Plc, Etu Energias, Platform Petroleum, Seplat Energy PLC, Green Energy International, Lekoil Nigeria Ltd, AMNI International Petroleum Development Company Ltd, Sahara Group, Shoreline Energy and many, many more. These indigenous companies create jobs for Africans, buy from African suppliers, and do business with other African companies, in addition to their extensive community outreach efforts. We have, and need, foreign companies that do the same—and share their technologies.

And that’s only part of the picture. Africa has not fully capitalized on a game-changing opportunity: monetizing our oil and gas resources. This starts with using oil and gas as a feedstock to create other value-added products. Natural gas, for example, can be used to make liquid transport fuels, base oils, paraffin, and naphtha. The resulting revenues can be used to build infrastructure and diversify economies. This is not an abstract, pie in the sky idea. In Equatorial Guinea, for example, initiatives aimed at monetizing the country’s massive natural gas reserves has led to the creation of new infrastructure. It is helping the government build a natural gas mega hub that could make Equatorial Guinea a major player in the global liquified natural gas market and bring in $2 billion in revenues. There’s no reason that other African countries can’t do the same.

Our Opportunities, Our Timing

I am realizing that fully capitalizing on Africa’s oil and gas resources poses significant challenges, but it is doable. All my three bestselling books, Billions at Play and Big Barrels: African Oil and Gas and the Quest for Prosperity, A Just Transition: Making Energy Poverty History with an Energy Mix, living provide practical steps for realizing the African Energy dream. They show there are ways to strategically harness our oil and gas resources, create economic growth and promote stability, the kinds of changes that impact everyday people throughout the continent.

Our view on oil and gas is not about greed or lining the pockets of a select few. If we work to use these resources wisely, they really can power a better future for Africa. And we’re not ready to toss them aside.

Distributed by APO Group on behalf of African Energy Chamber.

A commitment to sustainable development

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On September 1, 2024, Bill Gates, co-chair of the Bill & Melinda Gates Foundation, is on a significant visit to Ethiopia, marking his first trip to the country since the onset of the pandemic. This visit aims to strengthen partnerships with local organizations and grantees dedicated to addressing pressing health challenges and fostering economic opportunities for the Ethiopian people. In advance of his trip, Gates shared insights, in this exclusive interview with Groum Abate, Editor-in-Chief of Capital, into the foundation’s long-standing commitment to Ethiopia, the challenges the country faces in its development journey, and the importance of collaborative efforts to create a healthier, more prosperous future. With a focus on sustainable development, Gates’ visit underscores the foundation’s dedication to supporting the Ethiopian government and its people in overcoming obstacles and achieving their development goals.

Capital: Your foundation’s CEO Mark Suzman was in the country a few months ago, and now you are here. Could you please share with our readers what brings you to Ethiopia and why the country is so important to the foundation?  

Bill Gates: The Gates Foundation has a long-standing commitment to Ethiopia. Our mission is to help ensure that every person has the opportunity to lead a healthy, productive life, through ending preventable disease, poverty and inequality. We work closely with the countries and communities where we feel we can make the biggest difference.   We’ve supported partners here for over two decades. And we opened our permanent Ethiopia office in 2012—our first on the continent. In the years since, the foundation has built strong partnerships with local communities, as well as in both the private and public sectors. And with the continued partnership of these key stakeholders, we will continue working toward the common goal of improving the lives and livelihoods of Ethiopians.  

On this trip—my first to Ethiopia since before the pandemic—I’m excited to reconnect with our partners and discuss how we can continue working together to drive sustainable development. A lot has changed since my last visit to Ethiopia. Shocks like COVID, conflict, drought, locusts, and flooding have disrupted Ethiopia’s progress in recent years. It’s important that we assess how we can continue working together to get back on track and accelerate progress in health, agriculture, and financial inclusion.  

Capital: Ethiopia has faced enormous challenges like the pandemic, droughts, and conflict, which have impacted the agenda for reducing poverty and addressing health challenges. In your view, what are the most pressing challenges facing Ethiopia in terms of development and how is Bill & Melinda Gates Foundation supporting the country to overcome these?

Bill Gates: For a long time, Ethiopia made great progress towards its development goals, particularly by improving health outcomes and increasing incomes. But in the years since, Ethiopia has experienced a confluence of crises that have stalled—and in some cases, even reversed—hard won progress in the areas of health and development. Despite these challenges Ethiopia has also experienced good progress. Getting back on track won’t be easy.  It will require resilience and creativity, but luckily, we know there’s an abundance of talent here. Your leaders and innovators have proven before that this country can lead the way on health, agriculture, financial inclusion, and more.   

The foundation is committed to supporting and working with African governments and institutions on solutions that serve those whose needs are the greatest: women, children, and people living in poverty. It will also take resources from donors, deeper collaboration across sectors, and a new global financial architecture that ensures all African countries can access low-cost financing and have a path out of debt.  The Gates Foundation remains dedicated to collaborating with the Ethiopia government and to ensuring that we can achieve these outcomes as part of our broader work to advocate for solutions that will ease the burden that debt and conflict have placed on Ethiopia. Together, we believe these efforts will pave the way for a brighter, more resilient future for Ethiopians.

Capital: A big worry not just for Ethiopia but for the continent is the dwindling overseas development assistance (ODA) as more leaders in Europe and the United States seem to be reducing their funding to global health. How can we ensure that development efforts in Africa are not hampered by this trend? 

Bill Gates: I’m deeply concerned by the recent decline in international funding for key global health priorities—which comes at a time when the needs are as great as they’ve ever been. So many countries, like Ethiopia, are still recovering from the pandemic, and working to recapture the progress that’s stalled in recent years. It’s vital that international donors allocate enough funding to support global health efforts in countries like Ethiopia. That’s why we continue to support organizations like Gavi and the Global Fund, which have a proven record of tackling the world’s greatest health challenges.

And it’s vital the governments seek creative partnerships and solutions. For instance: the single largest source of external funding for Africa comes from Africans living abroad, in the form of remittances from diaspora communities—nearly $30 billion in 2023 in Nigeria and Ethiopia alone. And Ethiopia is exploring new ways to leverage funding for diaspora communities to support key development goals. Still, the global community must continue working to ensure resources are allocated where they’re needed most. We will continue prioritizing Africa, focusing on efforts that sustain development, including collaborating with organizations focused on debt relief and restructuring to reduce the debt burden on low-income countries and sustain development across the continent.  

Capital: The issue of climate change, especially agricultural adaptation, is an issue of concern for many farmers in Ethiopia. How does the foundation approach this issue, and what innovations are there in this space? 

Bill Gates: I know that Ethiopia is paying close attention to climate change and your Green Legacy is bearing remarkable results. Ethiopia’s reliance on renewable energy resources is further testament to its commitment to sustainable development, environmental stewardship, and securing a resilient future for its people. It’s not fair that the countries that have contributed the least to climate change are forced to bear the worst of its impacts. But every year, those changes make it harder and harder to grow food. Droughts and pests have wiped out entire harvests. And the problem will only accelerate. The good news is that the pace of innovation is accelerating just as quickly. 

We work closely with local communities, governments, and private sector partners to promote climate-smart solutions and invest in innovations that support sustainable agriculture. Through these efforts, the foundation is not only helping farmers adapt to the immediate impacts of climate change, but also building long-term resilience in Ethiopia’s agricultural sector, ensuring food security for the future. 

For instance, we’re investing in innovative seed varieties that are resilient to drought and pests and can help farmers withstand dry seasons. For example, the biofortified orange-fleshed sweet potato developed at the International Potato Centre grows abundantly, is resilient to drought and disease, and comes packed full of micronutrients that are vital for healthy growth. It matures rapidly and doesn’t require significant amounts of water. By scaling up solutions like these, Ethiopia and other African nations can improve their economic output, ensure children grow up healthier, and forge a path to food security.  

Capital: Your foundation has opened offices in Kenya and Senegal. What motivates this decision, and does it mean the foundation will have an office in every country that it works in? How will this expansion impact the foundation’s work in Ethiopia?  

Bill Gates: We were pleased to open offices in Kenya and Senegal this year. Kenya is a country we’ve worked with for many years.  So, we decided to open an office in Nairobi to provide on-the-ground support for the work we’re already doing.  

Similarly, we felt it was the right time to open an office in Senegal. We believe it’s important to engage deeply with the communities we support, and these offices will improve our ability to work closely with local communities. The Foundation’s commitments to Africa have only grown over the years, and we are proud of the work our colleagues across the continent have been able to support. 

Capital: What is the impact of Melinda leaving the foundation? How will the foundation continue to prioritize gender equality in its work in Africa, particularly in light of Melinda’s departure?  

Bill Gates: As co-founder and co-chair, and a champion of gender equality, Melinda shaped the foundation’s direction, including our work in Africa. We know that investing in women’s economic power benefits children, families, and entire communities. 

That means investing in key areas, like women’s groups, access to and control over resources, health, and pathways to leadership.  Research from the Food Agricultural Organization, for example, suggests that if women farmers had full economic power – the ability to own land, own livestock, and control their harvests – economies would grow: 58 million people would see their incomes rise, and another 235 million would be more able to withstand the next food crisis. Melinda was passionate about taking steps to remove the legal and normative barriers that prevent women from participating in and influencing the economy. We’re committed to working with our partners to expand economic opportunity for women. And while Melinda will always be a champion of that work, her departure will not change the foundation’s commitment to it.  

Capital: What are some of the most impactful projects the foundation has supported in Ethiopia, and how do you ensure that these programs are effective and sustainable? Finally, what are your hopes for the future of Ethiopia and its development?

Bill Gates: We measure impact in terms of lives saved and opportunities created. In Ethiopia, and across Africa, we work with local partners to ensure the projects we support reach the people who will benefit the most, including women, children, and people living in poverty. 

For instance, we have worked with the government to gather  data and use it to make better decisions. That data helped inform decisions to adopt life-saving health innovations, including solutions that will help improve immunity to measles and prevent cervical cancer. 

Looking ahead, we’re focused on helping to make childbirth safer and healthier for both mothers and children. And we will continue supporting the government’s efforts to expand health access and improve service for all Ethiopians.

From 2000 to 2015, Ethiopia achieved most of the Millennium Development Goals. Child mortality fell by two-thirds. Ethiopia’s progress was stunning. And I believe that Ethiopia can recapture that progress. With sustained investment in the right areas, and with dedicated partners, Ethiopia can and will forge a healthier, more prosperous future.