(Ecofin Agency) - The Millennium Challenge Corporation is one of Africa’s main financing partners, especially in the electricity sector. However, fund beneficiaries are required to meet a number of conditions before obtaining the resources.
Senegal has just completed the necessary reforms to obtain a 5-year $550 million financing from the United States’ primary development fund -the Millennium Challenge Corporation (MCC). The money will help build high-voltage transmission lines and substations to improve access to electricity.
According to Mahmoud Bah, MCC’s acting executive director, the Senegalese government will contribute $50 million. He said the country has recently adopted regulatory reforms that are a condition for receiving the subsidies. In June, Senegal's parliament passed two bills to open the electricity market to private investment. In addition to creating an independent regulator, Senegal plans to facilitate access to the electricity transmission and distribution networks for private companies.
More than 70% of the funds will be used to build high-voltage overhead and submarine transmission lines. Substations and automatic load shedding systems will also be installed to improve the supply and cost-effectiveness of electricity in Dakar. The remaining funds will be used to improve access to electricity in remote areas and to strengthen the country's electricity regulatory system.
MCC has also provided power sector financing to other West African countries, including Burkina Faso and Benin.
Gwladys Johnson Akinocho