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Signature of a Loan Agreement for financing the Upgrading of the Konia-Voinjama Road Project in the Republic of Liberia
A Loan Agreement was signed today in Monrovia between the Republic of Liberia and Kuwait Fund for Arab Economic Development whereby the Fund will extend a loan of Kuwaiti Dinars six million (KD.6,000,000/-) (i.e. equivalent to about 20.4 million US$) to help finance the Upgrading of the Konia-Voinjama Road Project.
The Loan Agreement was signed on behalf of the Republic of Liberia by Mr. Augustus Flomo, Deputy of Minister of Finance, and on behalf of the Fund by Mr. Nedhal Al-Olayan, Deputy Director-General of the Kuwait Fund for Arab Economic Development in attendance of Mr. Thamer Al-Failakawi, Regional Manager for West African countries at the Fund.
The Upgrading of the Konia-Voinjama Road Project aims at supporting the economic and social development in the Republic of Liberia by providing reliable year-round land transportation in a subtropical forest region, which is located in Lofa District in the northern part of the country. The Project will improve connectivity and accessibility to places of work and social services for the inhabitants of the various towns and settlements located along the road path. The upgrading of the road is also expected to enhance investment in agricultural activities and development of related light industries, in mining activities, sustainable logging activities and is expected to create jobs and promote new business opportunities in this part of the country.
The Upgrading of the Konia-Voinjama Road, which is a section of the corridor road A13, is about 64 km long. The Project consists of upgrading the existing dirt and gravel road to an asphaltic two-lane two-way road that is designed according to appropriate standards. The road will be 7.5 meters wide with a 1.5 meter shoulders on each side. The Project includes drainage works on both sides of the road that will be earthen trapezoidal drains including culverts, outflow channels and ducts with utilities wells of appropriate dimensions in appropriate locations. The Project includes repair works on 7 bridges.
The total cost of the project, including reserves, land acquisition and interest during implementation, is estimated at about 9.462 billion Liberian Dollars, the equivalent of about KD 17.6 million, of which about KD 13.6 million is in foreign currencies, which represents about 77% of the total project costs. The Project implementation period is estimated to be 4 years.
The Loan shall be for a period of 26 Years, including a grace period of 5 Years, and shall be repaid in 42 semi-annual installments, the first of which will be due on the first date on which interest or other charges will fall due, pursuant to the Loan Agreement, after the expiration of the said grace period. The Loan bears an interest rate of 1.0% per annum, in addition to a rate of 0.5% per annum to meet administrative costs and other expenses incurred in the implementation of the Loan Agreement.
The Kuwait Fund loan represents the 4th loan extended by the Kuwait Fund to the Republic of Liberia as the Fund has previously provided 3 loans to the Republic of Liberia in the transport sector with a total value of KD 11.078 million. The Fund has also provided to the Republic of Liberia with one technical assistance in the amount of 500 thousand Kuwait Dinars for the preparation of the technical and economic feasibility studies of the Gbarnga – Mendicorma Road Project, in addition to a grant extended on 2nd March 2012 by the Government of the State of Kuwait to the Republic of Liberia to pay its dues to the Fund.