Wednesday, July 24, 2024
SocietyWater fund receives EUR 75 mln to finance 35 rural towns

Water fund receives EUR 75 mln to finance 35 rural towns

The Water Resources Development Fund (WRDF), which was established 12 years ago to facilitate financial resources for water and sanitary projects, has received 75 million euros to be disbursed for 35 rural towns that are undertaking clean water and sanitary projects.

Securing a basket of loans amounting to 75 million euros from the European Investment Bank (EIB), France Development Agency (AFD) and Italian Development Cooperation Agency (ICD), the fund has inked agreements with the first eight eligible regional towns to disburse a 188 million birr soft loan on Friday.

Wanna Wake, director general of WRDF told The Reporter that the loan agreements will help construct new primary and secondary distribution networks targeting some 850,00 beneficiaries. According to Wanna, the loan agreements are part of the previous project that was cancelled due to disputes that arose with the contactors. The previous 36 million euros project that aimed to benefit half-a-million population was funded by the European Union and EIB. It is to be recalled that EIB withdrew the 16 million euro that was to be channeled for the projects.

After years of negotiations, the project resumed incorporating Fitche, Dembi Dollo, Gabra Guracha, Holeta, Bonga, Soddo, Adigrat and Maichew towns in the Oromia, Tigray and Southern regional states. During the terminated project, the Amhara Regional State was known to have recruited seven towns. However, the regional government opted to finance the project from its own means and was not part of the new financing program, Wanna said.

The new 75 million euros financing will help regional towns develop water distribution networks based on what was left from the previous project activities. Hence, WRDF has agreed to channel 188.4 million birr. Some 120 million birr matching fund is expected to be pulled in from the beneficiary towns.

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According to Wanna, the committed loans have a five-year grace period due to be paid in 25 years with three percent interest rates per year. The projects are expected to be finalized in one year period.

Michael O’Leary, team leader of the project consulting WRDF, told The Reporter that his team is overseeing the execution of the projects as per the schedules and the loan criteria agreed on. He said that previous failures will not be repeated. 

Established 15 years ago, WRDF has been able to finance 56 projects worth some six billion birr. Out of the 56 projects, however, only 17 have been finalized to benefit some one million beneficiaries. Currently, a national project dubbed One Wash National Program is underway to benefit 20 rural towns. Previously the African Development Bank (AfDB) and UNICEF have extended USD 100 million and 17 million, respectively, to the water and sanitary projects WRDF oversees.

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