Ghana, South Africa, Others Oppose Nigeria's Interest in $5bn African Energy Bank
- Nigeria is currently facing resistance from some nations over the lobby to cite the African Energy Bank in Nigeria
- The idea of establishing an African energy bank was conceived by the APPO in collaboration with the Afrexim Bank
- According to reports, the competition among the nations involved in the bank's siting has sparked significant controversy
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Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology and the stock market.
As African oil-producing nations prepare to make a decisive choice regarding the establishment of Africa's inaugural energy bank, backed by an initial investment of $5 billion, dissent against Nigeria's proposal has intensified.
A coalition comprising Ghana, Egypt, South Africa, Benin Republic, Cote d'Ivoire, and Algeria has emerged in staunch opposition to Nigeria's bid to host the financial institution.
Source: UGC
These nations have engaged in vigorous lobbying among influential stakeholders tasked with determining the bank's headquarters location.
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Legit.ng earlier reported that through the Economic Community of West African States (ECOWAS), the Nigerian government plans to boost oil production through the energy bank.
African Energy Bank initiative
The idea of establishing an African energy bank was conceived by the African Petroleum Producers Organization (APPO) in collaboration with the African Export-Import Bank.
This new institution is regarded as crucial for advancing the African energy sector, as it is anticipated to offer funding for projects that international lenders overlook due to concerns associated with the energy transition.
According to ThisDay, the competition among the nations involved in the bank's siting has sparked significant controversy, amplifying the number of participating countries involved in the deliberations.
In addition to the mentioned nations, other countries participating in the decision-making process at the end of this month include Angola, Cameroon, the Republic of Congo, Democratic Republic of Congo, Equatorial Guinea, Libya, Niger Republic, and Senegal, with Venezuela holding an honorary membership.
In the foreseeable future, the establishment of the bank is anticipated to hold significant importance for the sustainability of Nigeria's oil and gas sector and other oil-producing countries in Africa, particularly as Western nations increasingly divest from fossil fuel funding.
Headquarter nation to be picked in March
APPO, led by Nigeria's Farouk Ibrahim, has recently announced that a final decision on the organization's headquarters will be reached by the end of March.
This underscores the significance of the funding gap in the sector despite the presence of International Oil Companies (IOCs) in Nigeria, indicating a significant underfunding issue within the country's industry.
Condition for preferred headquarter-nation
APPO has outlined specific conditions that any interested country must meet before the headquarters of the energy bank can be established anywhere on the continent.
These conditions include air accessibility from any country, availability of essential amenities such as hospitals and educational institutions, adherence to the establishment agreement and charter of the bank, provision of a suitable proposed headquarters, and fulfilment of financial obligations.
Despite a Nigerian leading APPO, it's understood that their influence over the process is limited, as confirmed by Ibrahim, who recently expressed his neutrality until the end of his tenure.
Nigeria’s crude oil production rose to 1.64 million barrels per day in January 2024, per data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
Energy bank's benefit to Nigeria
Wale Ogundeji, an energy analyst, told Legit.ng that Nigeria hosting the African Energy Bank would be a strategic move for the continent's energy landscape.
He said:
"As Africa's largest oil producer, Nigeria possesses invaluable expertise and resources to spearhead energy initiatives.
"Establishing the bank in Nigeria could catalyze investment in renewable energy projects, fostering sustainability and reducing reliance on fossil fuels.
"Moreover, it would enhance regional cooperation, driving technological innovation and job creation across Africa."
He added that Nigeria can leverage its position to champion accessible, reliable, and environmentally conscious energy solutions, propelling Africa towards a brighter, more energy-secure future.
ECOWAS lifts 8 sanctions on Niger Republic
Meanwhile, Legit.ng had reported that President Bola Tinubu-led ECOWAS has lifted the economic sanctions on one of its members, Niger Republic.
The decision was reportedly made at the meeting of the West African bloc leaders in Abuja on Sunday, February 24, citing humanitarian concerns.
The sanctions were imposed following military coups in the countries.
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Source: Legit.ng
