December 19 2018

US commits $220 million for energy sector in EAC

Source: The Exchange – Africa's Investment Gatway

The energy sector in EAC is an exciting investment opportunity for American companies

The United States of America is slowly regaining its position in Africa with more foreign direct investments in the region as it commits to pump $220 million to improve the energy sector in the East African Community (EAC).

East Africa remains the most preferred investment region in the African continent with the vast array of business opportunities and conducive business climate presented by the governments.

In spite of the growing interest of foreign companies to venture in the manufacturing and infrastructure sectors highlighted as priority areas of investment by East African governments to catapult their economic development goals, the US sees it as vital to invest in the energy sector, which is showing promising and exciting potential for better benefits in the future.

Commenting on the US aid, EAC Secretary General Dr Libérat Mfumukeko said, “The US support to the region is a crucial one especially when the EAC is undertaking some major projects in realising the integration agenda.”

His comments reiterated the words of EAC Deputy Secretary General, (Productive and Social Sectors), Mr Christophe Bazivamo who in 2017 informing the second executive board meeting of the East African Centre for Renewable Energy and Energy Efficiency (EACREEE) in Kampala, Uganda stated that as the EAC integration was business oriented, energy was key to promoting trade in the region.

“Low energy access rates, expensive electricity and poor cooking solutions have been hampering the region’s development,” Mr Bazivamo was quoted.

The US is a force to be reckoned with as it is a strong partner of supporting various projects in the regional bloc, according to Mr Mfumeko.

The EAC – US Investment Partnership relations has mutually benefitted both parties to elevate their businesses, find new markets for their businesses and open up new avenues for trade.

Chinese investments in EAC have shaken the dominance of American investors, but the region is tipped to be a ‘battleground’ for the US-China rivalry in 2019.

According to a publication by The Exchange, US businesses continue to expand their reach by investing in various sectors including health, agriculture, oil and gas as well as other forms of energy.

Speaking in Washington President Donald Trump’s national security adviser, John Bolton, said: “Under our new approach, every decision we make, every policy we pursue, and every dollar of aid we spend will further U.S. priorities in the (Africa) region.”

Given the importance of energy in fulfilling EAC’s vision, the region will hold its 9th East African Petroleum Conference & Exhibition 2019.

Under the theme “East African Region: The Destination of Choice for Oil and Gas Investment Opportunities to Enhance Socioeconomic Transformation,” the Community will discuss the legal and policy framework and the overall business environment prevailing in the region.

Last month, EAC launched an energy security policy framework, developed in partnership with the UN Economic Commission for Africa in an attempt to reduce electricity cost and ensure reliable supply.