How market failures are holding Africa back

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Ghana has a curious problem: it produces too much electricity

Save time by listening to our audio articles as you multitaskThe biggest obstacle to economic development is often inadequate resources. But not always. In Ghana, generating power has proved much easier than distributing it. So, too, in several east African countries, including Uganda, where installed capacity is nearly double peak demand—and your correspondent sits writing this in a blackout.

A different variation of this paradox also arises in state-managed markets, like electricity, where governments have struggled to forecast supply and demand, and to build the infrastructure linking the two. It also appears within government institutions themselves. Because of poor management, health ministries in Africa fail to use about a fifth of the budget they are allocated, despite hospitals running short of medicines.

In a survey by the European Investment Bank, more than 60% of African banks say that a lack of “bankable” projects significantly constrains their lending to small businesses; a similar proportion of entrepreneurs tell World Bank researchers that they cannot get a loan when they need one. Sometimes the missing link is information, such as the credit histories that would help banks assess the riskiness of would-be borrowers. A second lesson is that quality trumps quantity. Yes, Ethiopia has a lot of cows, but they need to be kept healthy and slaughtered skilfully if their hides are to be turned into brogues.None of these obstacles is insurmountable. Farmerline, a Ghanaian firm, uses technology to connect farmers, their suppliers, lorry drivers, warehouses and buyers.

 

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Tesla cars this is your country!!! 😝

Sure there is better than all this dust

⬛️ ⬛️🟪🌱AFRICA IN THE NEW TRADE ENVIRONMENT WorldBank SSA REPRESENTS only a smallshare of global production/trade while hosting 1/2 of 🌎's X-poor. The continent MUST: 1. ScaleUp its supply capacity 2. Better link production-trade to the🌎economy ⚠️

So too much energy production the news 📰 says is … How do we put some of this $500m into crop produce then?

sowah_pee hmmm

Nigeria has the world’s largest electricity deficit. Importing electricity from Ghana would seem a no brainer. BUT!!! Well-connected Nigerian rent-seekers with monopoly on the import of generators block all attempts to import Ghanaian power, holding back the entire country.

Since when did two much of electricity become a problem. If these is what you call a problem, then I think such problems are needed in my country

Nobody tell them about bitcoin mining

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