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Nigerian president says Canadian power contract still on
November 20, 2012 / 11:01 AM / 5 years ago

Nigerian president says Canadian power contract still on

* Power outages biggest brake on economic growth

* Scrapping Canadian contract drew industry criticism

* Political wrangling key concern for foreign investors

ABUJA, Nov 20 (Reuters) - Nigerian President Goodluck Jonathan has said he did not cancel a power transmission contract awarded to state-owned Canadian firm Manitoba Hydro, days after his office said he had, adding confusion to a closely-watched privatisation process.

Presidency spokesman Reuben Abati said on Nov. 14 the $24 million contract awarded in April had been scrapped by Jonathan, in a move widely criticised by industry experts who said it would shake the confidence of foreign investors.

“Let me assure you that we did not cancel (the) Manitoba contract,” Jonathan said in a media roundtable event aired live on television on Sunday, adding there were some issues over the award of the contract that were being sorted out.

When questioned about it on Tuesday, Abati declined to comment, other than to say the president’s word is final.

“(This) can be described as flip-flopping at best and sheer misinformation at worst,” the opposition Action Congress of Nigeria party said in a statement on Tuesday.

Manitoba was supposed to start work at the beginning of September but the government did not relinquish control of transmission.

Choosing a firm to manage transmission took more than five years, in a process supported by the World Bank.

Nigeria is in the middle of privatising the bulk of its electricity sector. Delays and uncertainty caused by political wrangling have been blamed for the failure of the process to attract competent foreign investors in previous state sell-offs.

Economists say a successful power privatisation could push growth in Africa’s second-largest economy into double digits, from around 6.5 percent now. Yet critics question the integrity of the process, which looks set to leave much of the sector in the hands of powerful local oligarchs with scant experience.

Africa’s most populous nation of more than 160 million is the continent’s biggest energy producer, but is blighted by persistent electricity outages which force businesses and individuals who can afford them to rely on diesel generators.

It also perpetuates social inequality in a country where the majority survive on $2 a day or less, depriving many of light at night or the ability to power water pumps, let alone recharge mobile phones or access the Internet. (Reporting by Felix Onuah; additional reporting by Camillus Eboh; Writing by Joe Brock; Editing by Tim Cocks and Mark Potter)

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