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10.03.2021 Business & Finance

Developing petroleum downstream sector key to success of AfCFTA – Bawumia 

Developing petroleum downstream sector key to success of AfCFTA – Bawumia 
LISTEN MAR 10, 2021

Vice President, Dr Mahamudu Bawumia, has urged petroleum downstream players to focus on developing the sector to take advantage of the opportunities offered by the African Continental Free Trade Area (AfCFTA).

According to him, while national refineries may be commercially unsustainable in some cases, there should be co-operation in the development of regional assets including refineries and logistical assets, to achieve the economies of scale required for commercial viability.

Dr. Bawumia, who was speaking during the virtual opening of the Ghana International Petroleum Conference 2021 (GHIPCON) in Accra said “this drives productivity and puts our able youth to work, which in turn preserves and enriches their dignity.”

GHIPCON 2021 was organized by the Ghana Chamber of Bulk Oil Distributors (CBOD), and the National Petroleum Authority (NPA) in partnership with the Ministry of Energy.

The two-day programme was organized on the theme “Positioning Africa's Petroleum Downstream for AfCFTA”.

AfCFTA on the other hand, is set to become the largest free trade area in the world with a market of 1.2 billion Africans. It is expected that Africa's combined GDP of US$2.5 trillion will reach US$29 trillion by 2050 riding on the back of AfCFTA and an expansion in intra-Africa trade from its very low base of 15 percent to 52 percent.

“AfCFTA provides industry with a perfect opportunity to contribute towards the realisation of a first world Africa. As continental multilateral policies are formed, success will always depend on the operational framework and the commitment of all actors,” Dr. Bawumia stated.

He said while AfCFTA is a decision of the Authority of the Heads of States of Africa, its success depends on the work of industry and the collaboration between industry and bureaucrats at the implementation level.

The Secretary General of the African Continental Free Trade Area, Wamkele Mene, in his keynote address said the key to the full attainment of Africa's industrialization objective is mainly by prioritizing value addition to its petroleum industry.

“Without value addition in the petroleum industry, the development of a beneficiation capacity in Africa, the trade that we seek to boost in Africa would not be achieved to the same level as we would if the petroleum industry was not part of the value chain of Africa's industrialization,” he said.

The petroleum industry, he noted, is an integral part of Africa's industrialization. Therefore, as the continent seeks to develop refinery capacity and develop a minerals beneficiation capacity, he said it is critical to do so leveraging AfCFTA and the market that it opens.

Mr Mene urged the continent to “strive to be more of a net exporter than a net importer of refined petroleum products. “We should strive to make sure that we rely less on the exportation of crude oil to other countries for them to refine our product for us and sell them back to us”.

The Chief Executive of NPA, Mr. Hassan Tampuli, in his welcome address said AfCFTA presents a great opportunity for all stakeholders in the petroleum downstream industry in terms of enhanced and seamless trading of petroleum products within the continent.

However, there are myriads of challenges and bottlenecks that must be removed to make this a reality. He disclosed among others that Africa suffers acute infrastructure deficit in the petroleum downstream industry.

These challenges, he noted, can be minimized with the appropriate modern technologies, capacity building, and regulations.

---citinewsroom

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