A Loan Agreement was signed today in Washington D.C., U.S.A., during the 2016 Annual Meetings  of the World Bank Group and the International Monetary  Fund, between the Government of St. Vincent and the Grenadines and Kuwait Fund for Arab Economic Development whereby the Fund will extend a loan of Kuwaiti Dinars four million (KD. 4,000,000/-), equivalent to about 13.6 million US$, to contribute in financing of Feeder and Agricultural Roads Project in St. Vincent and the Grenadines.  

 

                        The Loan Agreement was signed on behalf of St. Vincent and the Grenadines by His Excellency Hon. Camillo M. Gonsalves, Minister of Economic Planning, Sustainable Development, Industry, Information and Labour  and on behalf of the Fund by Mr. Hesham Al-Waqayan, Deputy Director-General of the Fund.

 

The Project aims to support the economic and social development of St Vincent, through integrating the road network of the villages and agricultural farmlands with the Island's main roads, to facilitate the exploitation and  transport of agricultural products, improve access to touristic sites, and facilitate rural residents access to employment, markets and social services, with an economic and safe transport in all weather conditions.

 

                        The Project comprises the reconstruction and improvement of about 22.6 km of feeder and agricultural roads in three Parishes of the Island to bituminous or concrete tertiary road standards with 14 - 17 ft. width including side drains, drainage and other structures, and road furniture. The Project also includes the consultancy services for the preparation of detailed design and supervision of construction works and institutional support for the Project Implementation & Management Unit. The Project is expected to be completed by 2019.

 

                        The total cost of the Project is estimated at about East Caribbean Dollar 55.8 million, the equivalent of about KD. 6.1 million, of which the foreign currency is equivalent to about KD. 4.2 million which represents about 70% of the total cost of the Project.  The Fund's Loan will cover about 66% of the costs of the Project, whereas the Government of St. Vincent and the Grenadines will provide the remaining balance of the cost and all necessary funds to cover any other expenses.

 

                        The Loan will be for a period of 24 years including 4 years grace period, and will be amortized in 32 semi-annual installments, the first of which will be due on 1^st date on which any interest or other charge on the Loan shall fall due after the elapse of the above mentioned grace period.

 

                        The Loan bears an interest rate at 2.5% per annum, in addition to 0.5% per annum to cover administrative costs and other expenses incurred in the implementation of the Loan Agreement.

 

                        Upon signature of this Loan Agreement, this Loan will be the 4^th loan extended by the Fund to St. Vincent and the Grenadines, considering that the Fund had already extended 3 loans to it, totaling about KD. 3.3 million (equivalent to about US$ 11.22 million).  The Fund has also extended to St. Vincent and the Grenadines with a Technical Assistances in the value of KD. 44,000 (equivalent to about US$ 149,600) to finance the Technical and Economic Feasibility Studies for the Electricity Expansion in South Grenadines.