afrol News, 27 October - Angola's electricity industry is set to boom, with forecasts that spending on electricity infrastructure in the country will reach $8.4 billion over the next few years.

According to new analysis by Frost & Sullivan, together with the country's robust economic growth, the growth will be off-set by a massive government investment in infrastructure development in Angola.

The new analysis from Frost & Sullivan, Strategic Analysis of the Angolan Electricity Industry, finds that Angola's two state-owned utilities earned revenues of $356.0 million in 2008 and estimates this to reach $450.0 million in 2015. The analysis covers sectors such as, construction, government/utilities, industrial, oil & gas and mining.

"Angola's rapid economic growth has undoubtedly resulted in high levels of demand for electricity by both residential and commercial end users," notes Frost & Sullivan Programme Manager Cornelis van der Waal. "Despite the current financial crisis, the Angolan government is expected to continue its reconstruction programme, with greater emphasis on the development of electricity infrastructure."

According to the analysis, the Angolan power industry is expected to grow by 20 percent by 2015, while the Angolan government has also channelled $2.5 billion into the power sector to improve its capacity and efficiency. Such trends augur well for the future of the electricity industry in the country, the analysis reports adds.

It however also adds that the poor state of existing infrastructure and lack of skilled labour threaten to impede rapid industry development. In addition, it points out that the high level of capital required to build a power plant is a major factor hampering industry expansion.

"Despite massive government investments, inadequate infrastructure is one of the key obstacles to the growth of the Angolan electricity industry," said Mr Van der Waal. "The poor state of ports and roads, as well as sub-economic tariffs, is also likely to slow down the growth of this industry over the next two to five years," he added.

In accordance with the Angolan programme for the development of the electricity industry, the country will need about 800 engineers to meet the development needs of the industry over the next five years.

"The country has a profound human resources crisis," cautions Mr Van der Waal, adding, "This is forcing Chinese companies developing projects in Angola to import 95 per cent of their manpower, triggering criticism from international agencies."

By staff writer

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