Honourable Ministers;
Your Excellencies Ambassadors;
Executive Director of the International Energy Agency;
Distinguished Guests;
Ladies and Gentlemen:
1. I am delighted to welcome you to the second Ministerial Forum organised by the African Union Commission (AUC) and the International Energy Agency (IEA). This follows the first very successful forum held in June last year at the AU Headquarters in Addis Ababa. This year’s forum is special in two ways. First, it is co-organised with the Republic of South Africa as the current chair of the Union and was, in fact, going to be held in Johannesburg. Secondly, the forum is being held virtually because of the constraints imposed upon us by COVID-19. Nevertheless, this does not diminish the importance or the quality at all.
2. The objective of these forums is to bring together energy ministers from Africa and energy ministers of IEA member countries to dialogue on the Africa’s energy future and the critical role that both sides play in securing that future. Since this year’s forum is taking place under the dark shadow of COVID-19, our theme is “Securing Africa’s Energy Future in the Wake of Covid-19: Facilitating Faster Recovery through Increased Investment, Innovation & Partnership”. Key experts from International organisations, financing institutions, private sector and civil society have been invited to contribute to the discussion.
3. This forum underscores the importance of concerted efforts in addressing the different elements of securing Africa’s energy future following the devastating effects of COVID-19. It is critical that the recovery is fast, resilient and sustainable. It is equally important that the recovery delivers jobs, supports livelihoods and leaves no one behind, especially women and youth. For this to happen, we must work in partnership to expand public and private investments and encourage innovations.
4. I am pleased to report that the African Union Commission is doing everything it can to lead the way in facilitating this kind of recovery. Immediately after the pandemic hit us, the AUC ran into top gear engaging all the key stakeholders inside and outside the continent to understand the impacts and potential solutions they could contribute to. In this regard, a series of meetings were held with the association of power utilities, CEOs of power utilities, power pools, regulators, development partners, financing institutions and policy makers. The outcomes of these engagements culminated in a high level ministerial meeting in May that adopted the AU response and recovery plan.
5. It is clear from those engagements that the energy sector is severely impacted by the pandemic. A study by the Africa Energy Commission (AFREC) revealed that the crash of oil prices will severely affect the AU member states that rely on oil exports for significant contributions to their economies with drops in revenues running as high as 14 to 19 billion dollars in 2020. The lock down measures resulted in sharp drops in electricity demand to the tune of 10 to 40 per cent. The loss of value of local currencies against the hard currencies has increased the debt burden of power utilities and their Member States. This was further exacerbated by loss of incomes causing higher default rates in payment of electricity bills as household share of electricity rose relative industrial component as people spent more time at home.
6. The AU response and recovery plan seeks to address these issues through short, medium and long-term strategies. The short term priorities are to save lives by supporting efforts to electrify health facilities and supporting from line responders. In this respect, Member States came up with a raft of stimulus packages to support the most vulnerable sections of the population to continue accessing electricity services even if that meant availing it to them for free or extending grace periods.
7. The other important aspect of the AU response and recovery plan focuses on providing support to key energy institutions, especially power utilities and off-grid providers, to survive the severe operating conditions and emerge in a robust position to drive economic recovery. And thirdly, the recovery plan seeks to ensure that momentum towards the realisation of Agenda 2063 aspirations and achievement SDG7 is sustained.
8. For these ambitious steps to be successful, the participation of all key stakeholders is crucial. And that’s what makes this AUC-IEA Ministerial Forum such an important and timely event. The key role of strong partnerships in tackling a global challenge zeroing in on the African energy landscape is a major success factor not only for the energy sector but for the entire economy. A fast recovery is very important for Africa in order to avoid rolling back on gains made over the last few decades and to avoid condemning a large section of the African population to poverty, disproportionately affecting women and youth.
9. A robust energy sector is necessary building upon policy gains so far made in encouraging grid and off-grid investments with high participation of the private sector. The AUC has been at the fore front of leading harmonisation of policy and regulatory framework in the energy sector in Africa to stimulate investments and build a strong energy market. Another important aspect is the need for tapping into the innovations of digitalisation and creative business models especially from the private sector. Today’s forum will benefit from the inputs of private sector and other stakeholders as well as the experiences of different Member States to shape further improvements to policy and strategy for the fast recovery and increased investments that Africa to drive the recovery.
10. In this connection, the forum will start with an overview of the IEA’s World Energy Outlook and its implication for Africa followed by a summary of the AU recovery plan. This will pave way for in-depth discussions on how to ensure sustainable recovery in uncertain times feeding into a discussion on closing the financing and investment gap with a focus on priorities, innovations, and stronger multilateral cooperation.
11. I am eagerly looking forward to the contributions in today’s forum drawing from the vast experiences and pool of knowledge. The outcomes of this dialogue will inform policy and strategic directions that will shape the path of Africa’s energy future post COVID-19.
12. With these few remarks I thank you for your kind attention and invite my co-host Dr. Fatih Birol to make his remarks.
Thank you
H.E. Amani Abou-Zeid
Commissioner, Infrastructure and Energy
African Union Commission
