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Alba Iulia
Monday, October 18, 2021

Zambia to get $50m loan for rural electrification

Economy Zambia to get $50m loan for rural electrification

GOVERNMENT will soon conclude an agreement with the Japanese government under which a US$50 million credit line will be provided to support identified projects in the rural electrification master plan.

Energy and Water Development Minister, Kenneth Konga said the long-awaited rural electrification master plan had been completed and would be launched soon.

Mr Konga said officials from the Japan International Cooperation Agency (JICA) arrived in the country yesterday to appraise the project.

The minister was speaking in Lusaka yesterday when he officiated at the inauguration of the second board of directors for the Rural Electrification Authority (REA).

Mr Konga said the Government was also expected to sign a grant agreement with the Swedish government under which that country would provide more than US$30 million to the rural electrification fund to support rural electrification projects over the next five years.

He said the development of mini hydro power stations in areas where the potential exists had been identified as one of the methods of rural electrification.

Mr Konga urged REA to seek alternative sources of energy supply for rural electrification.
“In the current environment of a power deficit situation, we need to look at all the available renewable energy sources and utilise them to the fullest to meet the electricity needs of our rural population,” he said.

Mr Konga also said the financing instruments that were being arranged by the Government were in addition to the electricity levy and other financing mechanisms provided for by the Rural Electrification Act of 2003.

At the same meeting, newly-elected REA board chairperson, Patrick Wanjelani said the authority would work towards achieving its objectives as provided for in the Act.

Mr Wanjelani said there was need for various stakeholders such as the Government and cooperating partners to cooperate if the REA projects were to be successful.

In October, the Government signed an agreement with the World Bank under which a US$ 33 million credit line would be availed to support electrification programme in Zambia.

About US$19 million of the credit will go towards supporting rural electrification projects which will include grid extensions, installation of solar photovoltaic systems and construction of mini-hydros.

Another 10 million euros grant from the European Union will also be availed to support rural electrification projects.

[Times of Zambia]

72 COMMENTS

  1. What we need is more power generations plants to increase the current capacity. Why go into the rural when there isnt sufficient power to cater for the urban areas? :-??

  2. Its too much of loans,already our debt stock is way above $2bn.This time around there will be no JUBILEE coz everyone is under presure.

  3. #5, you are right where are they going to get power to electrify the rural areas. Why not build more power generation and even export some and use the profit to electrify rural areas. Isn’t there a rural electrification tax on Zesco bill already? These guys will not electrify the rural areas and these loans are just going to go back where they came from and some of it into the pockets of MMD crooks. And who will pick up the tab.us and our children. Even if we sue these guys ..cash goes to their lawyer friends. What a loose loose situation for Zambia

  4. Instead of tackling the issues at hand which has seen more than 1000 people lose their jobs, they are busy taking nkongole. How do you take electricity to other places when in places where you have it is not enough? KCM smelter will soon be openning, Chambishi copper smelter, Lumwana. These mines will take more than 150 megawatts. how much are taking to the rural areas?
    😕

  5. Zadyewa Izo, there be conferences in Livingstone and other tourist destinations, by the end of it all, this money would have finished in allowances and other expenses, Rural areas will remain with no electrification. Ni pa Zed, its a big joke!!!

  6. #5 we need to connect the rural areas before we finalise privatising the Electricity sector, otherwise private companies wont connect them to the greed. in terms of priority i think Rural electrification and power station construction will move side by side. CEC and TATA have finalised the deal to construct a 40MW station in Kabompo and the govnt has already given a go ahead. Zesaco will also not take a much bigger component in the Kafue lower meaning that the large chunk will be taken by the private sector. the point is let govnt connect the rural before private sector fully take over. its a good move i think.

  7. since 1995 rural electrification has been implemented whats wrong with these politicians. They only announce money but no tangible results. 8-|

  8. The brural people deserve this cause they are the ones who put Lundani in Staten House but only that Loans are not good the country.

  9. #15. If they are done simultaneoulsy it makes sense. Electrying the rural before increasing capacity doesn’t make sense to me. what happens to the infrastructure whilst you await the power plants to be set up? The fellows will vandalise. And if they activate them with the current capacity it will mean increased load shedding for all.

    We need to increase our capacity first

  10. Zambians need to be protesting at these loans more than anything. Just because the debt was cancelled once doesn’t mean it will be cancelled again. Rupiah bands government will see the destruction of Zambia.

  11. People with names like Mutale, Bwalya, Chanda, Chilufya, Chileshe Chiluba etc have already started making their personal budgets coz they know it will land into their pockets for sure.

  12. #16 NEWBBY NDONYA
    I think results are there for you to see if you travel around the country. Last year when i was there i travelled to Malawi and on My way i found Zesco constructing a 11kV lines along the great east road and they had already connected Nyimba district to petauke and katete, i think what was remaining were transformers around nyimba area to now take the power to the houses. During that time they had also connected Chama to the Malawi grid. On the copperbelt i had also seen construction of 11kV lines in masaiti and around kafulafuta going into the bush.

  13. There is no need to treat every loan with contempt. According to my knowledge, the developed countries are the ones who have voluntarily pledged to help out the poorer nations in various forms and giving loans is only one of them.
    Depending on how these loans are used, for example if we were to use the money to reduce poverty levels and hence improve our standard of living, these loans will be written off. The problem arises when we our government fails to convince the donors that the loans were used progressively.

  14. #20 THE ONE
    They are actually doing it simultaneously, the difference is rural electrification is handled by GRZ while power station construction is private. i.e kabompo power station construction has already started and will take about 3yrs. kafue lower will take about 5yrs startng probably next year, as for Rural electrification it will take a long time bacause you have to do the power transmission lines, substations and power distribution lines. Then the villagers, those that can aford have to wire their houses. moreover these projects are handled by Govnt and they will be slower than those handled by the private sector. I think the best is to start now.

  15. This is good news,the only problem is am not in fovour of these loans,you mean Pa Zed we cant generate our own money from the resources God has blessed us with? The will come a time when Japan will demand these monies and it will sad that we’ll be unble to pay back,then tu Japan will capitalise on that elo tukaledimanda fye copper.We all Know Moses Katumbi from DRC.What he did was he he told all the foreign investors to start with developing Lubumbashi before they can start making money,which they did.Nomba ifwe yaa.that’s why Rashid Jones alandila ati we are sleepy and ignorant.

  16. #26 Engines
    Govt will have to go a step further and pull the electricity into the villager’s houses coz they definitely wont be able to afford it. I spent some time in the rural areas of Southern Province there’s poverty out there dude. Only a few houses have solar panels and that’s like a one off cost with no monthly bills. So if our Govt is expecting the rural dwellers to pay for connectivity to their homes they hav’t done there ground work

  17. #28 The One
    My understanding of these projects is that Govnt wants to turn these areas into Farming Blocks where investors both local and foreign would easily engage into irrigation farminig. This then will trigger economic activities in the areas and the local people will later aford to wire there houses for electricity connections. Because honestly the Govnt will not connect a thatched Mud house to Zesco.For those with iron roofed houses, i think they can aford because wiring a house is far much cheaper than roofing.If you can aford roofing then you can aford wiring.

  18. #27
    I dont know what you mean when you say developing lumbumbashi coz all i have seen there is expensive Cars in the midst of disorganised streets, unplanned settlements, Dust roads with huge potholes and large scale street vending.People sleeping in card boxes and highly corrupt Cops roaming the streets.

  19. Well i feel the sad part is that the money is almost certainly going to be missaplied ( to put it mildly). However you cant argue with the idea of increasing the number of people with access to electricity and the fact that such services have a positive effecton development.
    😕

  20. Sometimes I wonder if Zambia will ever be what it used to be when I was 5yrs old. I Miss home so much! Does anyone of you have hope that things will be better for Zambia? Awe nalema nabazungu.

  21. ama nkongole…………..
    RB and his team seem determined to take us back to pre-HIPC status!!! Do we really need these loans? Didn’t ZRA declare some trillions in revenue a few weeks ago? where is that money going? I thought taxes are what you use for development projects! These govts of the last 18 years have made a once proud nation into beggars for sure. I remember a time when you could say ” I am Zambian” and really be proud of the state of the country. Now……….Still proud but have nothing to show for it…………

  22. #34 Sara Johns
    African economies are dependant on which sector you are. If you are in a technical sector involving projects the best place is africa including Zambia because every project is a green field. I personally find europe to be so orderly hence boring.In Zambia its not about what time is someone going to produce results, its about is he/she even going to do anything.To answer your question, there is hope for those with ‘solid’ professions. But Nabazungu Nabeve nibamushe too much anso!!!

  23. #34 Sarah Jones

    Zambia is better than it was when you were 5yrds old. You can get anything you want in Zed. Non of that nonsense of “I went shopping for this or that in the UK or RSA or Zim” It’s all here dude! All you need to do is work hard and make money. This place is glorious. Come back dude!!

  24. #34 Sarah Jones that depends when you were 5 years old… unless late 60s-early 70s. It is much better than the 80s…

  25. # 37 Engines

    Bazungu ni ba fake. Whities are nasty creatures. You cant trust them. They’ve treated us so badly. They’re lucky God made us blacks with such huge forgiving hearts. Balitumpa

  26. #36 gelogelo
    There is nowhere in the word where a Large scale project is run on cash basis even if money is available. i.e if a mine asked me to undertake a big construction project,the contract will be such that they make part payment and the other part i will get a loan from a bank.For this loan, part of the structure to be built might end up being collateral, that way all risks are shared by me, the mine and the bank. imagine if i used my own cash to build it and the project stalled because the mine collapsed.in term of utilities projects, usually part of the bill goes towards debt servising.

  27. #41
    But that’s you as an entity. Govt should not run on the same principle. What are we paying taxes for if not for govt to be able to develop our country. Using your “senario” how would govt lose out if they used our taxes to build infrastructure in our country? Tell me

  28. #40 The One

    not all whites are Bad, there are good ones what must be acknowledged is that our culture is different, they have there own and we have our own. For example in South africa Blacks have now become more racist than whites and whites have become big time crooks but thats not to say every black south african is racist or every white is a crook.Its a world of diversity we live in my dear.I have also seen in Zambia a Bar tender giving preference to a white Man over a Black Zambian. is that a white mans fault???

  29. Is Zambia so poor that it does not have a mere $50 Million? This is shameful! No wonder even the currencies of smaller and poorer countries are stronger than the miserable Zambian Kwacha. I cannot see the current breed of leaders redeeming the Zambian economy. How unfortunate!!!!!!!!!

  30. $50m is not a lot of money. We should not be rushing to borrow such small amounts. Instead we should rush to come up with ways of making this sort of money. Can we really fail to make $50m. We spent more than that on elections.

    Having already borrowed, we should find ways of making $50m plus interest so that we dont fail to repay. Rural people may not be able to pay the tarrifs so we shouldnt count on a return from them. Many people in rural areas are too poor to pay utility bills.

  31. #42 The One
    In this case Govnt or rather the Tax payer is the Client, Then the construction company to undertake the project is the entity like me. Then the lender in this case the japanese govnt is like a Bank.For such a project what you are going to see is that most consultants and the procurer for the equipment will be Japanese companies.Imagine Govnt payed full amounts to such companies and they decided to abandon.I supose the $50m is not the full amount for the project, its just part of the down payment obligation on the client, the other part of the money will be raised by the construction company and the equipment will be collateral something like a build transfer type of contract

  32. If I had $1 billion sitting in my bank account today, I would not invets it in power generation in Zambia. Why? Experts have said the tarriffs in Zambia are not high enough to give an investor a good return on their investments. This is why we have not seen a rush for power generation like we did for copper mining, despite power cuts. Solution is to increase the tarrifs. But generally Zambians are too poor to afford higher electricity tariffs. Further this will throw rural electricification off track, as rural people will find it harder to afford.

    So how do we hope to invite private investors.

  33. THAT IS WHY I ENVY BEING IN GOVERNMENT. SO FOR KONGA IT MEANS
    A) GOING TO JAPAN AT SOME POINT SAYING I AM GOING TO REPORT
    B) TRAVELLING LOCALLY TO SUPERVISE BUT IN REALITY MORE ALLOWANCE
    C) MORE BRIEFINGS TO THE MEDIA, BUT IN REALITY MORE ALLOWANCES
    D) MORE CONTRACTS AWARDED TO FRIENDS WITH LOTS NICHEKELEKO
    E) MORE LYE AND LYE UNTIL HE EATS HIS WAY TO THE GRAVE EITHER THROUGH KAPEMBWA DISEASE OR HEART ATTACK

  34. #42 The One what if govnt used Tax payers money on cash basis to the consultants and the construction campanies and they decided to abandon with a funny reason like lucky of security in Africa and bad terrain to reach the rural areas. Chiluba is facing charges now because he was paying Katoto cash money on millitary contracts and the chap just bolted after payments.If govnt used loans from host countries of those millitary equipment suppliers things would have been different this time around.govnt is not a good debt collector and so it should never pay cash on projects that can only be handled by foriegn firms.

  35. #47 UK-Zed Observer
    Thats exacly what it is. a power station is not an easy investment and the returns are very long term. investors are saying they acn only move in if the return can be within 50yrs. At the current tarriffs thats not possible,however what is bringng investors now paticularly on Kafue lower and kabompo is that Gvnt can might allow export at a better price to SAPP but at the expence of local supply.unfortunately exports will be minimal if Zimbabwe economy stays stagnant and if the interconnector to east Africa is not done on time.in terms of electricity the War in congo works to our advantage because thats the competitor in terms of these projects and their projects

  36. #50 Engines

    That sounds hopeful. May the investors come. Yes if the Govt can allow them to export, well and good. After all we are puuting up export processing zones for manufacturers. We may as well generate power to export. At least some Zambians will get jobs, and as you said, a bit of that electricity will be consumed in Zambia.

    Just wondering whether we should be praying for the Congo war to stop! Hmm. May be we should be praying that Mugabe goes, so that we can export more power there. Market forces!

  37. #50 Engines.

    Just to continue. Japan, China and all those Asian tigers developed because of exports to the West, especially the USA. It will be good if Zambia can be as much export oriented as possible. It always leads to prosperity. I would not mind if investors came to set up power plants just to export. We will certainly earn forex and invest it in rural electrication via zesco. We can turn Zambia into a hub of power generation for SAPP. We have the natural resources to do that.

    Is this one aspect the Govt looks at, in addition to tourism, mining, agriculture and manufacturing? I mean power generation for export? Making all these sectors export oriented can earn us a lot of money.

  38. When I was 5 years the council had bin men who used to collect gabbage on a weekly basis. Elo vitumbuwa were 5 ngwee for 1.

  39. When I was 5 years the council had bin men who used to collect gabbage on a weekly basis. Elo vitumbuwa were 5 ngwee for 1.

  40. For the Congo, they also have a similar model to export power to east africa. what is remianing for them is just transmission lines and a few big substation to convert there DC power to the AC that most african countries use. As for power stations they already have them, however because of the war investors feel they are not secure because wars will bring a lot of interruptions. Zambia has an advantage in that we are peacefull and we use AC power that can be exported without convetors, however we dont have power stations.So we have to quickly do these projects so that by the time peace returns to Congo, Zambia would have penetrated the market.

  41. #54 UK-Zed Observer

    Those are good positive contributions other than political personalities that dominate this blog. have a good day my dear i wish you all the best. Iam off for some…..

  42. #57 Thanks

    How would one describe the electricity sector in Zambia. I left zambia 4 years ago and all I knew is that there was Zesco and CEC on the Copperbelt. I knew of no other participant.

    Are we likely to see an open and competitive power sector as is the case in other countries? E.g UK, we have at least 5 companies invoved in power generation, transmission, distribution etc plus gas supply. British gas was privatised and it is given a good run for its money by competitors. Actually we even switch between energy suppliers. I have done that 3 times, both for electricity and gas.

    Is Zambia’s power sector shaping up to be as competitive?

  43. [-( i have heard this line before ‘rural electrification’ 😕 what happened to the last one… was it ‘free education’ sounds like headlines eh loans are not bad per se, just that i havent seen the tangible result of such loans… ubo bewna ebwafya!!!

  44. Sometimes in life or as zambians we should learn to say no when certain things are not needs. What is our priority? Is it food or electricity for villagers who cannot even afford it. In my village there is electricity and the only connected place is the clinic other people in the area cannot afford to connect the power lines which pass just on top of their roofs. Now can you imagine how many billions of kwachas the government spent?. This rural electrification was agreed by all SADC countries, but we should ask ourselves first, is it our main need at the moment. Rural electrification is good I feel our main need at the moment is food security.

  45. Yeah right give them power! It doesn`t matter whether they have fertiliser or not!

    What a government this is! Forget electricity you people. My mbuya doesn`t need to have electricity. What she needs is fertiliser. Life goes on during the day what is power for when she has no fudu?

    When will Africans learn to set their prioties right? “Tools”!

  46. The problem our government has is failure to identify needs and set priorities. Whatever people impose on us we follow even if it’s not one of our main needs. We need ways of improving food production because no matter how rich we may be in natural resources as long as we are hungry we will still be regarded as poor people. All this is as a result of the people we choose to leaders us.

  47. Some of our leaders when attending meetings they do not say anything, they just warm chairs, paid allowances and come back to claim this is what we have agreed in the meeting while they could not represent us. We need leaders who know what is best for Zambia and not those who just come to make money in Government because they cannot do anything for themselves as such they want to depend on our tax money.

  48. Ba engines, thanx for the info I like to be educated in these matters. What you are saying makes sense. My only problem was govt borrowing such a low sum for something like this. As one poster said, rural electrification is a waste of money if those same villagers are going hungry. Why not invest in Gvt backed cooperatives to make improved agricaultural practises a reality? the availability of tractors would really see an improvement in our agric sector. Here we are next to Zim and govt hasnt seen to take advantage of the vacuum of agric exports that Zim used to produce. I wod love t see vegetables from home here as I usually see them from kenya, South Africa and even Burkina Faso!

  49. It is like our new government is digging graves for us as they are asking for a lot of Loans. When will they pay them back. Lease hope we are not going in Chiluba´s period.

  50. Government has been collecting Rural Electrification Levy for the past 12 or 13 years. I wish they would account for the money collected before saddling the country with further debt. Our sovereign debt already stands at around $2bn. That is 25% of what it was when we had nearly all our debt cancelled 3 years ago.

  51. Debt debt when you you suckers going to learn to pay cash for all your needs? Why not wind energy?It is cheaper and be locally produced, Why not solar?

  52. I think we need to ask the Govt to account for all loans they have ever received since independence whether the debt has been cancelled or not.We need every ngwee/kwacha to be accounted for.If it cannot be accounted for we as zambians need to start grabbing the properties and searching for those foreign accounts.Interpool,the ICC and other International Anti criminal agencies can help us out. It’s time to take back everything that has been misappropriated This thing of allowances and workshops needs to end. What are needed are conference calls, Local investors come up with phone companies especially landlines and charge prepaid fixed amounts to make money from the business sector.

  53. Well done Nyama Soya. Setting priorities right. I need to see when giving out my gifts.

    Ho Ho Ho. What a government this is!

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