Leaders of the two states, president Levy Mwanawasa and his Namibian counterpart, Sam Nujoma, signed a memorandum of understanding (MoU) following their meeting in the tourist resort town of Livingstone, 500 kilometres south of the capital, Lusaka. The project, which will involve some 10,000 hectares of farmland lying on a joint power line to operate by November 2005, is particularly good news for Zambia as the country has suffered acute food shortages in recent years due to drought and floods that have afflicted most parts of the region.

Zambia is also formulating policies about moving away from reliance on mining and donor aid, to make agriculture a priority bread-earner. The venture stipulates that it will facilitate the establishment of modalities in enhancing production of various food crops to avert hunger. Rhodnie Sisala, managing director of Zambia's power utility, Zesco, says a 220 kilovolts power line would be constructed on a 230 kilometre stretch of land between the two countries at a cost of $12 million. Engineering design and environmental impact assesments have already been approved, he intimated.

"The African Development Bank (ADB) will provide $6 million loan, while $2 million will be borrowed from the Development Bank of Southern Africa," he said, adding that the balance will be raised by Zesco and Namibia's power authority, Nam-Power. It could be said that Namibia is leaving no stone unturned in ongoing developments: BHP Billiton, the world's biggest diversified resource group is in advanced discussions with Nam-Power about a possible joint power deal.

The internationally reputed group said it was geared to invest in power projects across Africa following an increase in aluminium business, which has grown to 1.36 million tonnes annually. Aluminium smelters require vast amounts of power, and BHP Billiton aims to leverage its energy demands provided by its own smelter to enter Africa's power industry.

Nam-Power's managing director, Dr Leake Hangala, confirmed: "We are discussing possible areas of co-operation with Billiton." BHP Billiton, which owns the Ingwe Coal mine in Mpumalanga province, South Africa, is the biggest coal exporter in that country so far. The coal is exported to Germany and Spain, where it is used in iron foundries. The project would extend to setting up a coal-fired power station at Walvis Bay.

Experts in the energy sector advise that the project will have to take into consideration the fact that Nam-Power's agreement with the South African energy utility,Eskom, runs out in 2007. After that it might not be possible for Eskom to apportion its power to Namibia at the current rate, as they (Eskom) have dire financial and operation problems of their own. Billiton's undertakings in Africa include the Mozal smelter in Mozambique, where it controls a 47 per cent share. Apart from being the major supplier to Eskom, it is also its biggest customer because of its aluminium smelter plant.