EIB provides funding for Zambian power projects

Dec 01, 2006 01:00 AM

Zambian authorities and the European Investment Bank (EIB) have agreed a preliminary financing deal for major power projects under plans to improve infrastructure in Africa, a senior EIB official said.
David White, head of EIB for Southern Africa and Indian Ocean, told that a tentative agreement had been reached with Zambia to finance some of its power projects, under the New Partnership for African Development (NEPAD).

Zambia state power utility Zesco plans to spend about $ 1,2 bn for several projects, including the 750-MW capacity Kafue Gorge Lower and the 120 MW Itezhi-Tezhi. Zesco also plans to expand the 900 MW Kariba North Bank power station by an additional 360 MW. More than $ 600 mm is earmarked for Kafue Gorge Lower power project.
"We are discussing with the government the financing of power projects and we have asked them to come up with a priority list before we can see how to finance the projects. The government will decide which one to finance first," White said, but gave noindication of how much the EIB would provide.

Zambian authorities are also in talks with Iran's Farab International and China's Sinohydro on the construction of the Kafue Gorge Lower project and the Itezhi-Tezhi power projects respectively. White said the EIC in collaboration with the European Commission was eager to finance various development projects in Africa, especially Sub-Saharan Africa, under NEPAD -- a home-grown African plan to improve governance and financial accountability in return for increased investments from the west.
The EIB would also finance a power inter-connector in Namibia, which would link that country to the Zambia power grid, White said.

White told on the sidelines of a mining conference in Lusaka that the power projects were aimed at improving availability of electricity to shore up industrial growth and also mining activities in the region. White said Africa would only develop by promoting cross-border projects covering many nations and that the EIB would be able to finance any viable projects.
White said the NEPAD and the 14-member Southern African development Community (SADC) had agreed to prioritise cross-border projects which would require immediate financing from the EIB. Zambia exports power to Zimbabwe, Botswana, Namibia and South Africa, which re-exports it to other southern African nations.

Source: Nampa
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