18/01/2007: Signature of a Loan Agreement of Kuwaiti Dinars 3 Million for the financing of the Medina Gounass – Guinean Border Road Project in the Republic of Senegal

A Loan Agreement was signed today in Dakar between the Republic of Senegal and Kuwait Fund for Arab Economic Development whereby Kuwait Fund will make a loan of Kuwaiti Dinars 3 million (equivalent to about US$ 10.2 million) for the financing of the Medina Gounass – Guinean Border Road Project.

The Loan Agreement was signed on behalf of the Republic of Senegal by H.E. Mr. Lamin Ba Minister of Plan Durable Development and International Cooperation and on behalf of Kuwait Fund by Mr. Hamad S. Al-Omar, Deputy Director-General. 

The objective of the Project is to support social and economic development in the South-Eastern region of Senegal, through improving its linkage to the Capital and to other regions, up to Guinean Borders and facilitating the utilization of that region's natural resources. The Project includes the construction of a 70 km length asphalted road with a 7 meters width, plus 1.5 meters paved shoulders on each side . It also includes the provision of the consultancy services needed for preparation of engineering designs and for work supervision. A number of minor feeders roads with an approximate total length of 30 Km shall also be constructed to connect the nearby villages to the project. The expected completion date for the project is 3 years. 

Total Project cost is estimated at about CFA 14 billion (equivalent to about K.D. 8.2 million), about 57% of which (or the equivalent of about K.D4.66 million) is in foreign currency. The loan of Kuwait Fund would cover about 37% of total cost of the Project. 

The loan shall be for a period of 25 years, including a grace period of 4 years, and will be repaid in 42 semi-annual instalments, the first of which to fall due on the first date on which interest or other charges will be payable on the loan after the expiry of the above-mentioned grace period. The loan will bear interest at the rate of 2.0% per annum, in addition to a 0.5% charge for loan administration. 

The signature of this Loan Agreement brings the total number of loans provided by Kuwait Fund to the Republic of Senegal to 24 loans, totalling about K.D. 80.3 million (equivalent to 273 million US$). The Fund has also provided to Senegal 3 technical assistances with total amounts of K.D. 702 thousand equivalent to about 2.39 million U.S. Dollars for feasibility studies.