What You Need to Know
The Africa Finance Corporation warns that Africa is on track for an 86 million tonne fuel shortfall by 2040, exacerbated by global shipping vulnerabilities. The continent’s heavy reliance on fuel imports, currently at over 70%, is expected to increase, raising concerns about energy security and economic stability.
Africa-Press – Eritrea. The Africa Finance Corporation (AFC) said the continent is heading towards an 86 million tonne fuel shortfall by 2040.
In a report published on Thursday, the AFC said the Iran war has exposed the continent’s vulnerability to global shipping chokepoints.
It noted that Africa imports over 70% of its refined fuel and some $230 billion worth of essential goods annually, including food, plastics, steel, and fertiliser.
Its dependence on fuel imports is projected to rise steadily from 74 million tonnes in 2023 to 86 million tonnes by 2040.
That, the AFC said, is equivalent to almost three of the giant refineries run by the Dangote group in Nigeria, which are by far Africa’s biggest.
Speaking at the report’s launch in Nairobi, the AFC’s chief economist Rita Babihuga-Nsanze said the crisis in the Middle East had made the consequences of this dependence impossible to ignore.
She noted that the effective shutdown of the Strait of Hormuz, which accounts for a fifth of global fuel transport, has left import-dependent countries in East Africa facing critical fuel shortages.
But the AFC said the passage was not the only chokepoint posing a threat to the continent’s supply lines.
Speaking at the summit, Kenyan President William Ruto, said the war showed the need for Africa to stop relying on outsiders.
he said.
he added.
The pan-African finance institution said that fixing Africa’s energy shortfall requires new hubs and better performance from existing assets.
Africa’s energy landscape has long been characterized by a heavy reliance on fuel imports, with over 70% of its refined fuel coming from abroad. This dependence has been highlighted by recent geopolitical tensions, particularly the Iran war, which has disrupted global shipping routes and exposed vulnerabilities in supply chains. As the continent grapples with increasing energy demands, the need for self-sufficiency and investment in local energy infrastructure has become more pressing than ever. The Africa Finance Corporation’s report underscores the urgency of addressing these challenges to secure the continent’s energy future.
