US Lends $355 Million USD to Zambia for Lusaka Infrastructure
30 Apr 2012 - 09:44 by OOSKAnews Correspondent
lusaKa, Zambia — The U.S. government, through the Millennium Challenge Corporation, will lend Zambia $354.8 million USD to upgrade water and sanitation services in Lusaka province, under a compact deal to be signed in May. It will be the single largest investment in the country’s water sector since its independence in 1964.
The five-year deal, which is expected to be signed on May 10, 2012, will support the Lusaka Water Supply, Sanitation and Drainage project.
The compact agreement was finalized during meetings in Washington in mid-April between Zambian Minister of Finance and National Planning Alexander Chikwanda and Patrick Fine, MCC vice president in the Department of Compact Operations, and Andrew Maycock, his deputy in charge of compact operations for East and Southern Africa.
The decision was reached at MCC’s quarterly meeting in April, chaired by U.S. Secretary of State Hilary Clinton.
During his Washington trip, Chikwanda also held a series of meetings with International Monetary Fund (IMF) officials.
The MCC has provided $15 million USD to conduct studies for the water and sanitation project and to cover start-up costs.
Preparation of detailed design studies for sub-projects will be completed in mid-June, and after that, selection of contractors is expected to take another six months before actual construction begins early in 2014.
Investment plans under the project have a 25-year design horizon through 2035, and include short-, medium- and long-term projects.
“The government is looking forward to the implementation of this project because the existing water and sanitation infrastructure in Lusaka is old, and its capacity has been overwhelmed by the rapid population growth of over 2 million,” Chikwanda said.
Although the program covers only Lusaka province, the government is lobbying for more funding to expand the program to other parts of the country.
The minister said the government will set aside funds for sewer connections for poor households and maintenance of drains, to ensure that conditions of the compact are met.
He affirmed the Zambian government’s commitment to good governance, particularly eradication of corruption, in line with MCC requirements.
“We are very happy with the relationship we have with the new [Zambian] government and we hope that there will be no hitches in the program,” Fine said.