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Signing A Loan Agreement With The Republic Of Guinea
20/01/2007: Signing a Loan Agreement of KD 5,000,000 for Financing the Komba – Boummehoun Road Project in the Republic of Guinea
A Loan Agreement was signed today in Conakry between the Republic of Guinea and Kuwait Fund for Arab Economic Development, whereby the Fund will provide a loan of 5 million Kuwaiti Dinars (equivalent to about U.S.$ 17 million) to assist in the financing of the Komba – Boummehoun Road Project.
The Loan Agreement was signed on behalf of the Republic of Guinea by H.E. Madikaba Kamara Minister of state for Economic Develpment, and on behalf of the Fund by Mr. Hamad S. Al-Omar Deputy Director-General of the Kuwait Fund for Arab Economic Development.
The Project aims at enhancing the economic and social development of the North West Region of the Republic of Guinea, and to satisfy the increasing demand on both national and regional trafic. The project will also improve the traffic flow between the city of "Labé" in the Republic of Guinea and the city of "Medina Gounass" in Senegal, thus contributing to the economic development of both countries.
The Project consists mainly of civil engineering works for the construction of an asphalted road between the towns of "Komba" and "Boummehoun" with an approximate length of about 103 Km., 7 meters width, and two paved shoulders 1.5 meters each. A number of minor feeder roads with an approximate total length of 20 Km. shall also be constructed to connect the nearby villages to the Project, and within the townships that the Project traverses.
The total cost of the project is estimated at about 290 Billion Guinea Francs equivalent to about 17.4 million Kuwaiti Dinars (59 million US$) of which 63% is in foreign currency. The Fund's loan amounting to 5 million KD (17 million US$) covers about 29%. The Project is expected to be completed by the end of 2010.
The Loan shall be for a period of 25 years including a grace period of 5 years. The Loan will be amortized on 40 semi-annual installments, the first of which shall be due on the first date on which any interest or other charges on the loan shall fall due after the elapse of the grace period. The Loan bears interest at 2% per annum, in addition to 0.5% per annum to cover administrative and other expenses to be incurred in the implementation of the Loan Agreement.
By concluding this agreement the Fund would have provided to the Republic of Guinea twelve loans totalling about 53.9 million Kuwaiti Dinars (equivalent to about 183.3 million U.S. Dollars) to finance Projects in various sectors, in addition to 3 Technical Assistance grants totalling about 417 thousands Kuwaiti Dinars (equivalent to about 1.42 million U.S. Dollars).