Increase in Irish Foreign Aid Ignores Real Problems in Africa

The Irish government intends to increase foreign aid even though current spending is massive for a small country like Ireland at  € 742 million per year. Most of the media and politicians do not seem to care that the problems in places like Africa are complex and cannot be solved by yet more foreign money. The Irish government have long held a simple maxim - if there's a problem, throw more money at it (see our health sector), rather than attempting to understand the root causes and build solutions from there. Recently, African leaders have highlighted some of these root causes but only Dublin politician Maureen O'Sullivan dared to raise them in the Irish parliament :

At a recent event in Dublin, the Rwandan ambassador made the point that $63 billion in illicit flows leaves the developing world. That is more than the foreign direct investment and aid going into those developing countries. Policy coherence would mean Ireland taking meaningful steps on tax justice. The Tánaiste may say that we got rid of the single malt, which is positive but it does not go far enough. What was needed was to take the steps the BEPS process has designed to tackle the underlying problem and prevent replacement structures emerging.

The policy incoherence is also seen in trade treaties in the imbalance between what the developed country gains and the minor gains for the developing world. For example, the Ireland-Ghana tax treaty prevents Ghana taxing the capital gains of mines, factories and large businesses owned by Irish companies. No spillover analysis was done prior to the treaty, which allowed for that and other examples of unfairness [link].

The President of Ghana, a country with some of the best farming and mineral resources in the world, recently told Macron that he wanted to move Africa away from being a dependent nation - "beyond aid". For President Akufo-Addo, the loss of Africa's best youth to Europe is something to mourn, not something that should be celebrated and encouraged, which seems to be the attitude of NGOs in Europe. 

https://www.youtube.com/watch?v=ZQcCk6x56QE

Why aren't governments listening to African leaders ? Well for a start there are the financial incentives in maintaining the foreign aid industry rather than helping to fix the underlying problems. Irish NGOs receive €5.5 billion per year from the Irish taxpayer.  The tax treaties are benefiting Irish companies operating in Africa. What of cocoa, one of Africa's largest raw material exports ? Europe dominates the worldwide chocolate market. It is Europe's top processed crop export and Europe is also the world's largest producer and exporter of chocolate. While Africa exports the vast majority of cocoa beans to Europe, it's share of global chocolate exports is less than 1%. There is significant room to increase chocolate production in Africa, could the foreign aid money be used to help local entrepreneurs there? Imagine Ireland's economy without the food production industry and we can begin to understand the challenges facing Africa.   

There is a long way to go to make Africa go "beyond aid", but it requires new thinking, rather than the old outdated aid industry, to fix it.

South Africa - the inconvenient facts that you don't hear about

Mainstream Renewables invest hundreds of millions but blackouts are now mainstream in South Africa

It was announced last week with great fanfare that Mainstream Renewables are investing € 670 million in wind farm projects in South Africa.

A consortium led by Mainstream was awarded the contracts for the three wind farms by the Department of Energy in South Africa in October 2013. The farms, in the Northern Cape province of South Africa, are expected to begin construction this month.Barry Lynch, Mainstream's managing director for onshore procurement, construction and operations, said mainstream has been awarded more megawatts than any other developer under the South African Government's renewable energy procurement programme.

South Africa are investing $10 billion in procuring 3,900MW of renewable capacity. Mainstream Renewables are part of a consortium behind around 600MW of wind and solar projects, including the biggest wind farm in Africa - Jeffreys Bay at 138MW.

Jeffreys Bay, the largest wind farm in Africa, but it couldn't prevent blackouts

We are told by the company's website :

Mainstream’s role in South Africa is also to help grow a new sustainable industry. Together we can create decent jobs, stimulate rural development and bring about real skills transfer. This will ultimately result in the development of sustainable communities and businesses with long term value that will benefit all South Africans.

So is there a renewable transition in South Africa which is what we are led to believe ?

Well, South Africa is very reliant on coal for its energy needs :

 According to the US Energy Agency, about 90% of its electricity comes from coal power stations. As of 2013, there was around 200MW of solar. Since then, 638MW of renewable power has been added including 240MW of wind built by Mainstream. Peak demand was around 44,000MW and installed capacity was at 45,700MW in 2013 - a very narrow margin. With the new renewable projects, total capacity now stands at around 46,340MW. But peak demand seems to have risen in the interim. The country has faced energy problems before :

In 2008, some coal mines had to halt operations because of power blackouts. In November 2013, Eskom requested that its largest industrial customers cut their consumption by 10% during peak demand times to avoid unexpected blackouts or load-shedding (scheduled power cuts). 

So has the 840MW of solar and wind built since 2012 helped S.Africa create a stable electricity supply ? Well the latest news from the country is not good :

(Link to Bloomberg Article) -- South African President Jacob Zuma said his priority is to solve the energy crisis in the country that’s curbing output at mines and factories and stifling economic growth, including adding more nuclear power by 2023.“We will pursue gas, petroleum, nuclear, hydropower and other sources as part of the energy mix,” Zuma, 72, said in his annual state-of-the-nation speech in Parliament in Cape Town on Thursday. “The country is currently experiencing serious energy constraints which are an impediment to economic growth and is a major inconvenience to everyone in the country.”Zuma’s speech follows nine consecutive days of rolling blackouts implemented as demand for power outstripped supply. State utility Eskom Holdings SOC Ltd., which provides 95 percent of the nation’s electricity, has warned of almost-daily blackouts until the end of April.The power crisis has soured investor appetite for South Africa’s currency and debt. The rand reached a 13-year low against the dollar on Wednesday and foreigners dumped 6.9 billion rand ($590 million) of the nation’s bonds since Feb. 3, the first day of blackouts. The outages have curbed mining production and forced businesses to shut doors at peak times, crimping growth in Africa’s most-industrialized economy.The government is seeking to build a 9,600 megawatt nuclear-energy program, with the first power from the source in eight years, Zuma said. South Africa has signed agreements and carried out vendor workshops with the U.S., South Korea, Russia, France and China, he said.

The President is now realising the unreliable and non-dispatchable nature of renewable generation and the costs of not investing in dispatchable and reliable forms - like gas, hydro and nuclear (although Concentrated solar thermal power plants may be somewhat more reliable). One can imagine the impact this is having on ordinary people in the country going about their daily lives. As for industry and economic growth, these are completely incompatible with the "green" vision of restricted electricity consumption and restricted conventional (reliable / dispatchable) forms of electricity generation. This then has a further knock on effect on ordinary people in the form of job losses.

It seems that the South African media (ESI Africa) had the bit of savvy to figure out the problem with renewables even before the re-occurrence of the blackouts :

Renewable IPPs not a big contributor to South Africa’s peak demand - while the number of renewable energy IPPs that are connected to the grid continues to grow and contribute to meeting the country’s energy demands, the contribution over peak is currently not substantial.

ESI Africa magazine is described as the leading provider of information relating to the African electricity and energy industry, delivering news to the continent and beyond and represents a broad spectrum of African energy organisations - including sustainable energy companies. 

So what are the qualified engineers there saying ?

GIBB is described as a leading multi-disciplinary engineering consulting firm based in South Africa with 67% Black ownership. One of the projects they were involved in was the construction of quality houses in Kwadukuza, a region of S.Africa. 



Their General manager, Paul Fitzsimons (a good Irish name), was quoted in the magazine last Friday as saying (full article here - can you imagine the opinion of an equivalent engineer in Ireland being valued like this in the Irish media, like the opinions of ex-Green ministers with no engineering qualifications often are ? ):

“Power and energy supply worldwide is an extremely complex business and to simply hold up one nation’s apparent solution [UK] as a one size fits all solution for South Africa is a gross oversimplification of the facts and indicates a lack of understanding of the problems these countries also face,” 

“While we would all like a world with less pollution and fewer carbon emissions, wind and solar generation cannot realistically supply base load generation.” 

“Germany is a good example of this, where instead of reducing its carbon footprint, it actually increased due to its dependence on coal fired stations when wind and solar generation was not sufficient to completely fill the void left by an exodus of nuclear power”, Fitzsimons continued.

So the South African government (despite what other faults they may have) and qualified experts in the field of energy are getting "real" about the future of electricity generation and are realising that the weather does not owe us a 21st Century standard of living. S.Africa is the country where green ideology is meeting the harsh reality of the laws of physics and the outcome is not pleasant if you live there.  

How ironic that those who are most worried about the effects of "climate change" on the African people are silent when an over investment in "green technology" to curb this perceived threat leads to blackouts, unemployment and economic devastation.

Lessons we can all learn here in Ireland.