The Lights Are Turning on in Africa
by Dana J. Hyde, MCC CEO
Madame Codjo owns a fish distribution company in West Africa in Benin’s economic capital of Cotonou. She is a savvy and ambitious entrepreneur, but when I met with her recently, she told me she struggles to keep her business afloat because of challenges outside of her control. Repeated electricity blackouts have forced her to rely on an expensive generator that drives up her costs, and even when electricity is available, wild voltage swings damage the equipment she relies on for her business.
As head of the U.S. government’s Millennium Challenge Corporation, I lead an agency that funds international development projects designed to unlock economic growth and fight poverty. Individuals and business owners across Africa know what Madame Codjo and MCC’s analyses show: lack of reliable electricity is the barrier to growth that is holding them back.
But change is underway. Over the past few weeks, I visited four MCC partner countries in West Africa and saw first-hand how governments, with support from MCC, USAID and other U.S. agencies, are taking action to connect their people to reliable and affordable electricity. Across all four countries — Benin, Ghana, Liberia and Sierra Leone — policy reforms and new investments are taking off that will transform power sectors and bring new sources of electricity online.
In Benin, MCC is working with the government to combine policy reforms with large-scale infrastructure investments in solar power and electricity distribution. In addition, MCC’s $375 million compact with Benin includes the largest U.S. government investment abroad in off-grid electricity — a faster, more cost-efficient way to give people in rural areas access to electricity. As a result, MCC’s compact will help businesses like Madame Codjo’s grow and thrive while also giving thousands of families and communities electricity for the very first time.
At the same time MCC’s unique, data-driven approach to development catalyzes additional private investment that maximizes the impact of our development dollars. In Ghana, MCC has supported critical reforms in the country’s power sector that have paved the way for nearly $4 billion in investments from domestic and international companies. These companies are making much needed investments in power generation so that the supply of electricity in Ghana can meet growing demand, and the people of Ghana can avoid dreaded power cuts.
During my visit to Ghana, I met Billy, the owner of a printing firm, who told me he had been on the brink of closing his business because of repeated power cuts. Now, thanks to these new investments, Billy hopes to use the cost-savings to expand his business and hire more employees. By supporting our partner countries in increasing access to power, MCC is transforming the lives of millions of people around the world. In total, MCC has already committed about $1.5 billion to connect people to electricity and support the goals of the U.S. government’s Power Africa effort, which President Obama launched in 2013.
The need for reliable and affordable electricity was especially clear in Liberia and Sierra Leone, two countries that are recovering from the Ebola outbreak. The U.S. stepped up to help both countries tackle Ebola, and I am proud that MCC can continue to support the recovery and restoration of long-term economic growth.
In Liberia, MCC is teaming up with other development partners to rehabilitate a shuttered hydropower plant that will be the largest source of power in the entire country. The complex was bustling with construction workers when I visited, and the first turbine at the plant is expected to come on line by the end of this year. In a country where only about one in 10 people has access to electricity, a new source of reliable and clean electricity will let more students study at night, more hospitals provide critical services at all hours of the day, and more businesses succeed.
In each of the countries I visited, new projects are underway that will energize communities and empower people. They will increase the supply of electricity, connect more people to the grid, and lay the groundwork for future investment in the power sector. With support from the American people, governments in West Africa are making rapid progress in powering homes and businesses and opening the door to sustainable economic growth. Together with our partner countries, we are helping to turn the lights on in Africa.