Corruption In Power Sector Killing SMEs – Research

A research conducted by the Centre for Democracy Development (CDD) and SOAS University of London Anti-Corruption Evidence (ACE), revealed that corruption in the power sector is killing Small and Medium Enterprises (SMEs) in Nigeria.
According to the research, SMEs account for 96 percent of business in Nigeria (PwC) which are vulnerable to losses for lack of electricity supply and corruption in the system.
The research said most of the SMEs get just one to five hours of electricity in a day adding that the huge supply shortfall in a huge electricity demand environment is killing the businesses.
Presenting the research on behalf of CDD,  Pallavi Roy of University of London’s Anti-Corruption Evidence (ACE) centre, said sanctions on electricity thief is not working because people are not seeing reason not to steal the electricity.
She said in 2013, there was 61 percent drop in electricity supply with people violating the laws to steal electricity because of the need to survive which breed corruption in the power sector.
She said the corruption in the power sector strive because no one wants to follow the rules adding that they’ve conducted the research in Nigeria, Bangladesh and Tanzania.
She decried the rule of law and the rule by law sydrome in Nigeria which she said is killing the smaller businesses but admitted that corruption is not based on race.
She said for Nigeria to succeed in the fight against corruption in the power sector, the common people must feel the tangible positive effect of power supply.
“From the demand, productivity is unlikely to be met through renewables energy,  Pallavi said of the huge market in the power sector in Nigeria.
“No one blow the whistle because all tap the electricity illegally. There is need for disagregated, embedded power- sector reform,” Pallavi said of the corruption in the system adding that the solution will be breaking the ‘circle.’
“There is market for power but SMEs are paying high costs for including the cost of corruption. 100 percent of SMEs have no alternative to the national grid, even though there is a huge market for power in Nigeria. People are ready to pay if there are better ways to pay. People spent alot on diesel with many others spending alot of money on generator maintenance.
“If the private sector don’t invest in power on areas they can get profit, other investors won’t come until the market is assured. So, there has to be a systematic system that will help the SMEs,” Pallavi added.
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