Where the Electricity is Always On!
February 8, 2016
One of my daughters works in international sales and recently returned from her first visit to South Africa full of tales and observations. She was particularly entranced with the beauty of the country, especially in and around Cape Town. During her travels she has become quite a student of foreign exchange, and was excited by the strength of the US dollar against the South African rand. Top Johannesburg hotel rooms are currently less than $100 a night, and pool side mojitos come in at a reasonable $2.25. What struck her most was a sign posted in her hotel’s elevator that said “The Sandton Holiday Inn – Where the Electricity is Always On”. Not being a world traveler myself, but a frequent user of elevators, I found this sign very interesting. Regular, uninterrupted electrical service may seem like a god-given right in the US, but in some parts of the world that is certainly not the case.
Shortly after the end of the Iraqi war the US Department of Defense developed a number of metrics that were published in a weekly update of the recovery of the country. The numbers were intended to monitor and demonstrate a return to normalcy. The data included statistics on crime, shootings, and IED explosions, but they also posted the number of hours per day of uninterrupted power available in Baghdad. The latter metric continues to be an important guide to the condition of an economy.
After spending her business trip in complete electrical bliss, my daughter caught a cab back to the airport. During the ride her newly acquired energy awareness helped her notice two things as she passed through the townships on the route. In the few areas where electrical lines were in place, the lines appeared to be over loaded and congested. In addition she observed that the houses in a couple of townships had boxes and panels on their roofs. My daughter asked her cab driver about the purpose of the boxes and panels. The answer was that these individual homes were equipped with solar power. The panels were no more than three square feet in size and while not powerful enough to run an elevator at a Holiday Inn, were perhaps big enough to power some lights and a family TV set.
The absence of core infrastructure that provides clean water, healthy sanitation, reliable energy, and efficient roads and transportation, is a major problem in many parts of the world, but it also represents a significant opportunity. Some might look at that sign on electricity as no more than a reminder of the quality of the hotel compared with the poor state of the country in general. Others might look at the sign as a road map to growth. The markets, especially those in the emerging parts of the world, have been under pressure for several years but this small sign in an elevator shows me the potential that still exists for economic development over the long haul.
Carl Gambrell
