Billionaire Nigerian entrepreneur and philanthropist Tony O. Elumelu, chairman of Heirs Holdings, was invited to testify at the U.S. Senate Subcommittee on Africa’s hearing on President Obama’s Power Africa Initiative on March 27.
He will join representatives of three other lead private sector partners of the initiative – Paul Hinks, CEO, Symbion Power; Del Renigar, senior counsel for Global Government Affairs and Policy at General Electric Co.; and Tom Hart, U.S. executive director of The ONE Campaign
Elumelu said in an email on the eve of the hearing that his testimony would focus on the progress Heirs Holdings has made toward fulfilling its $2.5 billion commitment to the Power Africa Initiative, which the company announced in July 2013, following President Obama’s announcement of the initiative in June.
“This is a crucial opportunity for Heirs Holdings, for our stakeholders, and for the initiative as a whole. The U.S. government does not often receive news from the perspective of an African private sector operator that is doing well, and visibly creating an impact,” Elumelu said in his email. “This is an opportunity to not only showcase our positive activity in this region, but also to begin changing the public narrative on Africa, to promote our entrepreneurial spirit and our ability to facilitate economic transformation from within.”
Announced in June 2013, the Power Africa initiative calls for $7 billion in U.S. financial support over the next five years. It leverages private sector investments, beginning with more than $9 billion in initial commitments from private sector partners, include Heirs Holdings’ $2.5 billion. Affordable electricity is essential for Africa’s development and self-sufficiency. More than 70 percent of the population of sub-Saharan Africa lacks access to electricity. Businesses spend up to 60 percent of their operating costs on power alone. Every 1 percent increase in electricity outages reduces Africa’s per-capita GDP by approximately 3 percent.
Such a continental challenge requires a coordinated solution. Elumelu contends.
“There is no amount of capital investment or entrepreneurial zeal that will provide affordable and sustainable access to electricity for Africa’s 1.5 billion people without the full buy-in and energetic support of African governments,” Elumelu wrote last October in Commentary, which is published by the Center for Strategic and International Studies, a private think tank based in the United States.
He called on African governments to create an enabling environment for investment in which rules are clear, contracts are honored, and conditions are reliable, and on bilateral and regional development partners to provide the technical assistance to help create such an environment.
Elumelu said multilateral and bilateral development agencies, including the African Development Bank, should prioritize ways to de-risk the power sector, such as providing funds to create sovereign guarantees and bond securitization.
A live broadcast of the subcommittee hearing will be available at www.foreign.senate.gov/hearings/powering-africas-future_examining-the-power-africa-initiative.
