I have been
traveling several times to the Katanga province lately- for the reader not
familiar with the DRC geography, the Katanga is the ‘mining area’ of the
country and is considered to be the economical lungs of the DRC.
All the major
mining groups have been, at some point in time, involved in this part of the
country (BHP Billiton, Vale, Freeport, Anglo American etc). Unfortunately some
of them have left for different reasons. However, the sector is still booming
thanks to the Chinese demand that remain quite strong.
One thing that
will not go unnoticed when you spend few hours in Lubumbashi (the capital of
the province) is the constant electricity cuts.
The main issue
with this situation is that mining companies are not spared and today most of
those companies are working far below their full capacity. I have even visited
a plant operating using generators! Imagine the diesel bill at the end of the
month (also imagine how cheap must be the cost of production for that plant to
remain profitable using a generator).
(Some sectors such
as oil distribution are taking advantage of this situation but the impact of those
firms on the economy remain marginal especially that a big part of them are not
even paying taxes…)
The level of
production has become so insufficient that today we have to import electricity
from both Zambia and Zimbabwe. Countries where we used to export until recently…
Below is a
snapshot of the electricity situation as it stands according to official data.
Supply in MW
|
Demand in MW
|
||
Local production
|
600
|
Mining
|
1140
|
Import Zambia
|
150
|
Others
|
240
|
Import Zimbabwe
|
50
|
||
Deficit
|
580
|
||
Several projects
to develop the electricity sector have been in the pipes for decades but we are
still for at least one of them to materialize. By 2020, the demand for the
Katanga province is forecasted to reach 4 000MW.
Fewer projects
mean fewer investments, jobs and wealth created. Let’s hope that while we are
waiting for new power projects to come to life, China’s appetite for
commodities will remain as strong as now…
No comments:
Post a Comment