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Signing of a Loan Agreement for financing of ADZOPE 90/33 KV Substation Construction Project in the Republic of Cote d’Ivoire
A Loan Agreement was signed today in Abidjan, between the Republic of Cote d'Ivoire and Kuwait Fund for Arab Economic Development, whereby Kuwait Fund will make a loan in the amount 7.0 million Kuwaiti Dinars (equivalent to about U.S. $ 23.8 million), to the Republic of Cote d'Ivoire, to assist in financing ADZOPE 90/33 KV Substation Construction Project. An agreement, the Project Agreement, relating to arrangements for the implementation of the project, was also signed between the Fund and Societe des Energies de Cote d'Ivoire "CI-Energies" (the Company). It is worth mentioning that the Fund depends exclusively on its own resources in providing its loans and development assistance.
The Loan was made in pursuance of an initiative by His Highness Sheikh Sabah Al-Ahmed Al-Jaber Al-Sabah, the Amir of the State of Kuwait announced at the 3rd Africa-Arab Summit held in Kuwait during the period 19 - 20 November 2013 to grant concessionary loans to African countries to the tune of one (1) Billion US Dollars spread over the succeeding five years for financing development projects in the African countries.
The Loan Agreement was signed by His Excellency Minister of Economy and Finance Adama Kone, on behalf of the Republic of Cote d'Ivoire, while the Project Agreement was signed on behalf of the Company by Mr.Amidou TRAORE Director General Mr. Ghanem Sulaiman Al-Ghenaiman, Deputy Director-General signed the Loan and Project Agreements on behalf of the Fund. Mr. Ayad Al-Gharaballi, Regional Manager for Central, East and South African countries attended the signing ceremony.
The project aims at making electric energy available in Adzope department with reliability and quality suitable for economic and social development in the region. This should allow for fighting unemployment and providing job opportunities to young people, so as to achieve sustainable development.
The project includes: civil works, procurement and installation of the electromechanical equipment to construct the Adzope substation, Agboville and Attakro extensions, and the linking 90 kV overhead transmission lines together with extension and modification of MV network in Adzope department, consulting services, environmental and social studies, environmental impact mitigation measures, institutional support and land acquisition.
The total cost of the Project is estimated at about 24.8 billion West African Francs, Equivalent to about 12.46 million Kuwaiti Dinars. The Fund loan of KD 7.0 million partially covers substation, transmission lines and MV network and fully covers consulting works and supervision. Thereby, the Fund's contribution becomes about 56% of the total project costs, whereas, the Government of Cote d'Ivoire covers the remaining costs in addition to any cost increase that may arise.
The Loan is made for a term of 25 years, including a grace period of 5 years, and will be amortized by 40 semi-annual installments, the first of which will 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. Loan will bear interest at 1.0% per annum in addition to a charge of 0.5% for meeting administrative costs and the expenses of implementation of the Loan Agreement.
The aforementioned loan represents the fifth loan made by the Fund for financing of projects, as Kuwait Fund has already made four loans in to the Republic of Cote d'Ivoire in different sectors with a total amount of about KD 19.23 million, or about US $ 65.7 million. Furthermore, the Fund has extended technical assistances and grants with a total amount of KD 250,000, or about US $ 850 thousand.