Business
Nigeria state-firm to guarantee power suppliers
Former World Bank chief and new Nigerian finance minister and coordinator of the economy, Ngozi Okonjo-Iweala, will be chairman of the board of Nigeria Bulk Electricity Trading Plc, which is expected to start signing agreements with power producers, Jonathan said.
He said international partners, including the World Bank, were providing partial risk guarantees to support the company.
Jonathan pledged before his election victory in April to privatize electricity generation and distribution.
Nigeria’s privatization agency has said it hopes to complete the sale of six power plants and 11 distribution firms by the first quarter of 2012 as part of a multi-billion dollar plan.
Power shortages are a major brake on growth in sub-Saharan Africa’s second-biggest economy, pushing up the cost of business for manufacturers and making Nigeria uncompetitive as an investment destination for industry, despite a population which makes it one of the world’s largest untapped frontier markets.
South Africa, with a third of Nigeria’s population, has 10 times the generation capacity.
Power shortages also perpetuate social inequality in a country, depriving many of light at night or the ability to power water pumps, let alone recharge mobile phones or access the Internet.
The central bank says 60 million people rely on generators and spend $13 billion a year fuelling them.
Power minister Bart Nnaji told Reuters this week Nigeria was producing around 4,000 megawatts of electricity and he hoped to increase this to 5,000 by the end of the year, on the path to hitting his target of 6,000 in 2013.
Source: Reuters
