The Organization of the Petroleum Exporting Countries has extended a USD10 million loan in support for electricity roll out programs in the country.
Through its Fund for International Development (OFID), OPEC said it was fulfilling a pledge made in march this year during a roundtable for different donors organized by government.
The agreement between the OPEC Fund and the government was signed recently in Istanbul, Turkey during the Annual Meetings of the World Bank Group and International Monetary Fund.
“This will help us to take electricity to different parts of the country. The program is now on schedule and we are confident that with this round of funds, we will be able to achieve our budget target to increase access to electricity,” Finance Minister James Musoni who told The Sunday Times on Friday.
Musoni also revealed that this was the last batch of funds needed for the program. He also pointed out that the sum of $330 million needed to facilitate the roll out program has been collected from the donor community.
The government has set a five year period for its rural electrification program with the aim of increasing electricity accessibility from the current 6 percent to 16 percent by 2012.
“Electricity is a channel for development, it will increase investment opportunities and also improve the living conditions of our people,” Musoni said, adding that development of the energy sector is critical for economic growth.
Speaking on behalf of his organization at the signing ceremony, Suleiman Al-Herbish the Director General of OFID said the fund is availing a bulk of finance worth USD114.million in support of public sector projects in Africa, Asia and Latin America.
“Energy has also received a substantial portion of financing to expand poor communities’ access to a reliable supply of electrical power. While some of the projects are already underway, implementation is expected to begin on the others shortly,” Al-Herbish said.
Under the Economic Development and Poverty Reduction Strategy (EDPRS), the government plans to increase electricity supply to 130MW with 100 percent of health centres, administrative centres up to sector level and 50 percent in all schools in country by 2012.
OPEC is an intergovernmental organization made up of 13 oil producing nations.