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19 March, 2019 10:49:40 AM

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Closing energy gap would help poorest countries develop

Wealthier nations must do more to honour their aid commitments to help the less developed countries (LDCs) bridge the energy gap that now exist among the people in these countries
Prof. Sarwar Md. Saifullah Khaled
Closing energy gap would help poorest countries develop

It is universally accepted that energy is a sine qua non for the all round development of a nation – socially, industrially and agriculturally. But the global poor countries are lagging behind in this vital sector compared to the global developed ones.

Under this circumstance, the global rich countries with high energy production and consumption have a role to play for the development of the poor countries’ energy sector. This is necessary to bring parity in energy consumption among nations and overall economic development of the developing countries like Bangladesh. This would not only help closing the energy gap between the rich and the poor in poor countries needed for the global poorest countries’ accelerating development but will also ensure egalitarian enjoyment of the beneficial fruits of modern industrial civilisation across the world.
A United Nations (UN) report of late urges global wealthy nations to do more to honour their aid commitments to help the least developed countries (LDCs) bridge the energy gap that now exist among the people in these countries. The world's least developed countries urgently need access to more electricity if they are to break out of the vicious cycle of poverty that they are currently trapped in and develop socio-economically at the earliest. The report by the UN Conference on Trade and Development says that 60 percent of people in the world's poorest countries, 47 of which meet the UN's standards for being “least developed”, have no access to electricity at all. There in those countries live some 577 million people in total. Access to stable supplies of electricity is crucial for helping businesses, industries and agriculture in global developing countries to grow rapidly to break through the vicious cycle of poverty that they are trapped in at present.

The report that was released on November 22, 2017 said that more than 40 percent of businesses and industries in the countries covered in the report suffer at present from inadequate, unreliable and unaffordable power for use. It said that they report an average of 10 power outages a month, each lasting about five hours that cost them 7 percent of the value of their sales. The secretary general of the United Nations Conference on Trade and Development (UNCTAD) Mukhisa Kituyi told in Bangkok that "Energy as a source of transformation (of an economy) is one of the key issues of economic development and this is what we are trying to contribute to, specifically for the least developed countries". Kituyi said that there is a shortfall of US $1.5 trillion in funding to help meet the goal of universal access to power by the year 2030.

The report further said that it would cost an estimated US $12 billion to US $40 billion in annual investment while it will cause a more than tripling of the annual rate of gaining access to electricity in those poor countries across the world.

The countries covered in the report include 33 in Africa, nine in Asia, and five in the South Pacific and Caribbean region. The UN is encouraging governments in those poor countries to adopt policies to attract investors in the relevant sectors and improve the use of their energy resources to the desired extent to meet necessary development goals. But it was still very difficult for those poor nations to tap sufficient private sources of financing to that end for poverty alleviation satisfactorily at the earliest.

It is widely argued nowadays that the world has come to a point in recent time where many people are of the opinion that many solutions to socio-economic development are best triggered by the private sector. But it is not possible to say that about the least developed global countries yet. Kituyi said that “You cannot leave it to the private market to fix Laos and Bangladesh, and Cambodia challenges”. Renewable energy sources have the potential to play a revolutionary role to meet the challenges in such countries. But, so far, most of those initiatives in this regard have been small scale, and the UN is urging that the use of such technologies be scaled up to be useful for public utilities of those countries. It is expected that the relevant authorities in those countries including Bangladesh will expedite their efforts to that end for enhanced development of their economies to alleviate poverty and income inequality of their people.  

However, so far as Bangladesh is concerned, the World Bank (WB) has approved US $185 million to help Bangladesh add up to 310 Megawatt (MW) in renewable energy generation capacity. This is also to mobilise private sector participation to meet the growing demand for electricity in the country. It will build the first 50 MW phase of a large scale solar panel energy park in the Feni district. This will be implemented by the Electricity Generation Company of Bangladesh (EGCB). For the Scaling-up Renewable Energy Project the support will increase the country’s installed capacity of renewables through piloting and expanding investments in key market

segments.

The World Bank Team Leader for the Scaling-up Renewable Energy Project, Jari Vyrynen, said that in Bangladesh the power sector has grown rapidly from a little over 4,000 MW in 2009, with maximum generation capacity increased to more than 20,000 MW in 2018. The World Bank official added that a strong collaboration between the public and private sector will not only help meet energy demand of the country but also lower carbon emissions to avert climate change. The US $185 million credit also includes a US $26.38 million loan and a US $2.87 million grant from the Strategic Climate Fund (SCF) of the World Bank's Climate Investment Funds (CIFs).

However, the main characteristics and attractions of the loan is that in addition to improving the cleaner electricity supply for the country it will cut carbon dioxide emission in the air as well reducing climate change. 

The writer is a retired Professor of Economics, BCS General Education Cadre

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Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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