Malawi President Peter Mutharika seems to be making good use of his time in Beijing, China where he has gone to attend the 2018 Forum for China-Africa Corporation (FOCAC) as on Thursday, two days before the official opening of the summit, he met Chinese consortium of companies to discuss energy generation project to build a coal-fired power plant at Kammwamba.
Mutharika and his delegations met the Chairperson of the China Energy Engineering Group Ltd (CEEC) the Parent company of the China Gezhouba Group International Engineering Company; Wang Jianping and directors of the company.
Gezhouba Group International
Engineering Company is the Chinese company that is to construct the 300MW coal-fired power plant at Kammwamba in Neno, with a lifespan of 30 years.
Speaking at the high level meeting, President Mutharika briefed the company that he was glad that his government had met all the 14 conditions that were set by the financiers AXIM Bank of China for Malawi to acces the loan for the project which will help to provide electricity in the country.
Currently, Malawi only generates about 251MW of power and a paltry 10 percent of the country’s population is connected to the power grid of Electricity Supply Corporation of Malawi (Escom).
Mutharika told the gathering that Malawi is doing well economically but he was certain that once the Kamwamba plant is up and running, Malawi’s economy will grow even much faster.
“We need the extra energy as soon as yesterday. That’s why were very serious about this project. If we have their extra wattage from this project, our economy will perform much better than now,’’ Mutharika emphasised.
Mutharika said shortage of electricity to industries is one of the major challenges Malawians companies and citizens are facing and the situation is slowing down growth.
“These companies are able to make reasonable profits but they dig more on production costs to access other forms of energy imagine, how productive would thy be once this project is finalised,” said the Malawi leader.
In response, the CEEC chairman Wang Jiang updated the Malawi leader that as a company they have also finalised and secured approval for all the two preparatory phases of the project and that their company will soon be on the ground in Malawi to start implementing the project once AXIM Bank of China does its part.
The Chairman assured President Mutharika that his company as excellent delivery capacity such that the project shall be implemented within the project period or even before.
President Mutharika was accompanied to the CEEC headquarters by among others ; Minister of Finance Goodall Gondwe, Minisiter of Trade Henry Mussa, Foreign Affairs Minister Emmanuel Fabiano and others.
The commencement of the project, which will be the biggest investment in the energy sector to take about three years, raises hopes for improved power supply in the country and is critical to attract investments, particularly in the mining sector.
The project is expected to be implemented under the Engineering, Procurement and Construction (EPC) model, which is a particular form of contracting arrangement used in big projects where the contractor is responsible for all the activities from design, procurement, construction to commissioning and handover of the project to the end user or owner.
Once operational, the plant would help Malawi to diversify from using hydro power, which of late has proved to be challenging due to low water levels, but also bring a number of advantages.
Energy consultant Grain Malunga, who is also former minister of Natural Resources, Energy and Mining, said completion of the project is critical, arguing that it has potential to improve electricity supply in the country.
“We see the project boosting the energy sector. You may wish to know that the deposits [of coal] are enormous. It is pleasing that the project is taking shape because these are the resources we should have tapped long time ago,” he said.
Malawi Confederation of Chambers of Commerce and Industry (MCCCI), which has complained of subdued production due to power deficit, has called for speedy implementation of the project, as power outages have taken a toll on industrial output.
MCCCI chief executive officer Chancellor Kaferapanjira said the private sector is keen to see long-term solutions to electricity problems and developments such as these in the energy sector could improve the business outlook.
Minister of Foreign Affairs Emmanuel Fabiano said Malawi stands to benefit even more from the bilateral talks the country will hold with China.
“Through the bilateral talks, we expect to see a number of projects that will be negotiated and some of them implemented. As you are aware in the first ten years, we had five projects that were funded by the government of China some of them through concessionary loans and at least one of them as a grant,” explained Fabiano.
He said the President will also hold a number of meetings with different organizations that are operating in China as well as in other countries on the continent with the hope that the Malawi delegation can encourage them to come and invest in Malawi through Foreign Direct Investment.
Among other objectives, the summit intends to take stock of the implementation of the Johannesburg Plan of Action (2016-2018) under which China committed USD 60 billion for economic and infrastructure development in Africa as well as consider the (2019-2021) Beijing Plan of Action.