ECOWAS To Launch Energy, Transport Sectors’ Fund By End Of 2024

LAGOS – The Economic Community of West African States (ECOW­AS) is on the brink of launch­ing a dedicated fund for the energy and transport sectors by the end of 2024.

The initiative is aimed at bridging a financing gap ex­ceeding $12 billion annually in infrastructure within the integration space. Regional authorities plan to use this fund, housed at the ECOWAS Bank for Investment and De­velopment (EBID), as a finan­cial lever to fill the infrastruc­ture deficit in the energy and transport sectors.

On April 4, Sédiko Douka, the ECOWAS Commissioner in charge of Infrastructure, Energy, Mines, Water, Digita­lization, and Postal services, announced at the opening of the first ECOWAS Investment Forum (EIF) the intention to effectively launch the ECOW­AS Development and Financ­ing Fund for Transport and Energy Sectors (FODETE) by year-end. The initiative, approved in Abuja, Nigeria, on June 22, 2009, has experi­enced significant delays but gained momentum amid re­gional tensions between 2020 and 2022.

According to Douka, the fund, backed by ECOWAS Heads of State and Govern­ment, will be financed by a levy on products exported by member countries. Targeted products include agricultural, mining, oil, and gas exports, as discoveries of significant reserves have multiplied in recent years.

“We have conducted thor­ough simulations based on data from these products, and the results show the ca­pacity to mobilize up to $450 million annually,” Douka stated, speaking on behalf of the President of the ECOWAS Commission.

The fund is dedicated to improving and developing critical infrastructure in the transport and energy sectors, crucial for economic growth and regional integration. Its management will be entrust­ed to the EBID to ensure effi­cient and transparent admin­istration.

The Lome-based bank, ECOWAS’s financial arm with commitments reaching $4 billion this year, allocates 50% of its financing to inte­gration infrastructure proj­ects, particularly in energy and transport.

However, it remains un­clear if a regional consensus has been reached among countries, especially in times of regional tensions, with some members recently ex­cluded from decision-mak­ing and reflection bodies. The levy rate has not been disclosed.

“The fund’s creation is scheduled for the end of this year, although the process is still underway,” noted the Ni­gerien official, whose country has announced its departure from the integration body.

With the establishment of this financing entity, region­al authorities not only aim to improve connectivity and ac­cess to reliable and affordable energy for the region’s popu­lations but also to attract addi­tional investments into these vital sectors. Facing unprece­dented financing deficits and growing regional needs, this initiative seeks to address an annual investment shortfall estimated at $12 billion, es­sential for the economic de­velopment of the 15 member countries amid increasing demands.