Dar es Salaam. Access to reliable electricity is pivotal for economic transformation in Africa, creating jobs, empowering communities, and improving living standards, Tanzanian Finance Minister Dr Mwigulu Nchemba has said.
Speaking at the Mission 300 Energy Summit-Africa in Dar es Salaam on Monday, January 27, he stressed that the absence of electricity would leave unimaginable gaps in daily life and economic productivity.
“Imagine life without electricity for a day. Now imagine it for a month or a year. For some communities, this is their reality. It is simply unimaginable,” Dr Nchemba remarked during a discussion on energy investments.
His sentiments come against the backdrop of Africa’s struggle to provide adequate electricity to its growing population.
According to the International Monetary Fund (IMF), nearly 600 million people in sub-Saharan Africa still lack access to electricity, with the region heavily reliant on external financing to bridge the energy gap.
The deputy managing director at the IMF, Mr Bo Li, underscored the transformative potential of renewable energy in addressing this challenge.
He noted that a modest investment of $35 billion annually in Africa’s renewable energy sector could yield significant returns, including a 20 percent increase in electricity access and an annual GDP growth boost of 0.8 percent over the next decade.
“Renewable energy offers a fast and sustainable way to electrify households while reducing poverty. However, Africa faces immense difficulty in mobilising financing for energy projects, making external support essential,” Mr Li said.
To attract such investment, Mr Li emphasised the need for African governments to strengthen governance, transparency, and regulatory frameworks.
“By implementing external sector reforms and demonstrating accountability, sub-Saharan Africa could increase official sustainable financing by 20 percent,” he added.
Additionally, the IMF has rolled out a $48 billion Resilience and Sustainability Trust aimed at supporting low-income and vulnerable middle-income countries in building climate resilience.
Of this amount, $10 billion has already been approved for 21 countries, with Africa being a significant beneficiary.
Mr Li noted that private sector involvement is also crucial, particularly in renewable energy investments.
“Developing domestic energy markets and providing investors with revenue assurances through power purchase agreements could help secure long-term commitments to the sector,” he noted.
Africa’s energy deficit remains a significant hurdle to its economic ambitions.
However, with targeted investments, sound policies, and external support, the continent could unlock vast economic potential, transforming the lives of millions through reliable and sustainable energy access.