Abuja — Nigeria's Ministry of Budget and National Planning, in collaboration with the Sub-Regional Office for West Africa of the Economic Commission for Africa (ECA) launched, on this day in Abuja, the 2016 Country Profile for the Country.
The objective of this initiative is to provide analysis and recommendations specific to Nigeria, in its drive towards structural transformation that will foster sustainable growth and social development, as well as its performance in areas such as regional integration and the fight against social exclusion.
According to this country profile, electricity shortages in Nigeria (an average of 32.8 power failures per month in 2015) are a major problem for the country's economy. Available infrastructure are not suitable and cannot meet current demand. But, recent privatization efforts within the sector have improved the situation. Indeed, the energy sector plays an essential role in the transformation process of Nigeria's economy. Furthermore, Nigeria's country profile holds that: "Access to a sustainable and affordable energy is important for the creation of added value during the transformation of products into final consumer goods. Beyond its strategic role to foster industrial development, an effective electrical system is fundamental to social development, considering that it affects all aspects of human life. Access to reliable electricity improves communication, favors scientific and technological innovation, and increases the standard of living of individuals."
For Mr. Dimitri Sanga, Director of ECA's Sub-Regional Office for West Africa, "we cannot envisage the structural transformation of African economies without addressing the energy issue. For example, hydroelectricity provides an important source of energy, largely unexploited on the continent: only 5% of the continent's hydroelectric potential is exploited. In our efforts to achieve structural change in our economies, the energy issue is well ranked at the top of the process. Angola, Cameroon, Democratic Republic of the Congo, Ethiopia, Guinea, Nigeria and Sudan have considerable potential in this area, which must be harnessed not only for national economies but also for Africa in general."
According to this country profile, accelerating Nigeria's economic transformation requires stimulating competitiveness, increasing productivity and strengthening local production capacity.
To achieve this, the country must reverse more than two decades of deficiencies in the fields of electricity generation, transmission and distribution.
For such, it must redouble its efforts to establish a market-oriented policy to promote a secure and competitive energy supply at affordable prices and policies to enhance the reliability and sustainability of the electricity system, while encouraging the acquisition of equipment and technologies.
A clear regulatory framework is needed to attract private investment, to harmonize the series of measures on the energy supply development with other policies, including transport, employment and education, as well as to continue to invest in the expansion of the energy network while ensuring its regular maintenance.
The country must continue to invest in a diversified energy package through incentive policies that focus on non-fossil energy sources such as solar, wind and hydro.
Lastly, the issue of electricity pricing and indiscriminate use of subsidies must be addressed to reduce operating costs in the value chain and the economy as a whole.
