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Signing of a Loan Agreement in the Amount of KD 7,000,000 for the participation in financing of the Irrigation Project in Lake Chad and Bahr El Gazel regions in the Republic of Chad
A Loan Agreement was signed today in N'Djamena between the Republic of Chad and the Kuwait Fund for Arab Economic Development, whereby the Fund will provide a Loan in the Amount of 7.0 Million Kuwaiti Dinars (equivalent to about US$23.8 Million), to the Republic of Chad, to participate in the financing of the Irrigation Project in Lake Chad and Bahr El Gazel regions.
The Loan Agreement was signed on behalf of the Government of the Republic of Chad, by Mr. Issa Doubray, Minister of Planning and International Cooperation, while the Loan Agreement was signed on behalf of the Kuwait Fund for Arab Economic Development, by Mr. Hamad S. Al-Omar, Deputy Director-General of the Fund in attendance of Mr. Thamer Al-Failakawi, Regional Manager for West African Countries.
The Project aims to support the economic and social development at Lake Chad and Bahr El Gazel Regions, by providing the required and sustainable water to irrigate about 1,684 ha of agricultural lands from two water sources, Lake Chad and ground water wells respectively. Thus increasing crops production, improves farmer's income, and support government food security strategy.
The Project consists mainly of civil and electromechanical works to develop the targeted agricultural lands and to construct five water irrigation schemes, namely Talia (1,227 ha) and Yaola (350 ha) areas at Lake Chad Region, and Hamatiya site (1) (23 ha), Hamatiya site (2) (65 ha), and Hamatiya site (3) (19 ha) at Bahr El Gazel Region. The work shall include construction of sand dikes, pump stations, irrigation canals, field access roads, ground water wells equipped with pumps, and distribution networks. The project also includes consulting services for the preparation of detailed design, tender documents and project supervision, in addition to the project management.
The total cost of the Project, including contingencies and interest during the construction period, is estimated at about African CFA Francs (FCFA) 15.89 Billion, equivalent to about 7.79 Million Kuwaiti Dinars, of which about FCFA 10.25 Billion, equivalent to about 5.03 Million Kuwaiti Dinars, is in foreign currency, representing about 65% of the total cost of the Project.
The Loan shall be for a period of 24 Years, including a grace period of 4 Years, and shall be repaid in 40 semi-annual instalments, 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.
This Kuwait Fund's Loan represents the 6th Loan extended by the Kuwait Fund to the Republic of Chad, as the Kuwait Fund has previously extended 5 Loans to the Republic of Chad, to finance projects in various sectors, with a total amount of approximately 16.2 Million Kuwaiti Dinars. The Kuwait Fund has also provided the Republic of Chad with One Grant in the amount of approximately 14.9 Thousand Kuwaiti Dinars. Kuwait Fund also administered Two Grants provided by the Government of the State of Kuwait to the Republic of Chad, in the amount of approximately 1.9 Million Kuwaiti Dinars.