APM sends SOS to China on electricity woes
President Peter Arthur Mutharika has been sending messages to his Chinese counterpart Xi Jinping for investment in electricity generation in the country in the wake of low power generation.
China’s director general of African Affairs Department in the Ministry of Foreign Affairs Lin Songtian revealed this on Tuesday to a contingent of Malawian journalists on a visit to the country.
He said, however, China needs a feasibility study first before it comes in to assist the country.
“Mutharika always sends messages to the President of China on electricity generation. It is an urgent thing for him [Mutharika]. If Malawi is to attract investors, it needs electricity,” said Lin.
He said in response, China has encouraged a Chinese company to conduct a feasibility study on Kammwamba Coal Fired Power Plant.
The coal plant project is expected to generate about 300 megawatts(MW).
“China is ready for the project and it is one of its priority areas to help in electricity generation. We have already approached a reputable Chinese company called Three Gorges Corp to look at possibilities to invest in Malawi,” said Lin.
Three Gorges is currently one of the companies bidding for a major stake in Brazil’s fourth largest energy generator Santo Antonio Energia SA, according to an article in the China Daily.
According to Lin, the Chinese Government has already proposed to one of its banks to support the project at Kammwamba.
“China will do its best to push for the project. The company is so keen to work on it,” he said.
China’s interest commitment to boost Malawi’s electricity generation capacity is coming at a time the country is implementing a $350 million United States (US) Millennium Challenge Account (MCA) Compact to increase energy generation.
Currently, sole State power producer, Electricity Supply Corporation of Malawi (Escom) has capacity to produce 351 Megawatts (MW) against suppressed demand of 350 MW.
Due to poor rain season last year as a result of the El Nino phenomenon, the water levels in Lake Malawi and Shire River, has fallen to around 150 MW resulting in massive power outages in the country, a development which will impact on manufacturers output.
According to the Malawi Investment and Trade Centre (Mitc) Escom’s large commercial customers consume approximately 60 percent of the total electricity generated with domestic users accounting for 25 percent and 15 percent for the small commercial consumers.
The companies to produce goods and services require at least 400 MW of electricity a day.
The Malawi Confederation of Chambers of Commerce and Industry (MCCCI) president Karl Chokotho says due to massive load shedding, businesses in the country are being forced to use generators powered on fuel which are expensive to run and costly for small businesses.
Power outages are a major hindrance to doing business in Malawi, according to MCCCI and forces investors to invest in neighbouring countries with reliable power supply.
The World Bank report on Sustainable Energy for All says by 2012, only 9.8 percent of the population has access to electricity, making Malawi one of the countries with lowest electricity penetration rate in Africa.
While according to Doing Business Economy Profile 2016 report, for Malawi, globally, Malawi is ranked at 175 out of 189 economies on the ease of getting electricity for an entrepreneur.
