Malawi and the International Development Association (IDA), an arm of the World Bank Group, on Friday signed two financing agreements worth K127 billion towards the country‚Äôs power sector.
The signing ceremony for the two agreements, namely the Malawi Electricity Access Project and the Mozambique-Malawi Interconnector Project, took place at the World Bank Headquarters in Washington D.C, United States of America (USA), on the sidelines of the 2019 annual meetings of the World Bank Group and the International Monetary Fund (IMF).
IMF Minister of Finance, Economic Planning and Development and Development Joseph Mwanamvekha and World Bank country director for Tanzania, Malawi, Burundi and Somalia Bella Bird signed the two agreements on behalf of Malawi and World Bank, respectively.
He said, among others, the two projects will provide technical advisory services and building technical, planning and operational capacity of Electricity Supply Corporation of Malawi (ESCOM) and Ministry of Natural Resources, Energy and Mining and other relevant institutions.
‚ÄúGiven that reliable electricity service delivery remains a challenge majority of Malawians living without access to electricity, these two projects are indeed important for Malawi‚Äôs development and are coming at the opportune time,‚ÄĚ said Mwanamvekha.
The minister said the two projects complement each other as one focuses on increasing access through the grid and the off grid while the other project will contribute to diversification of external sources of power.
The Malawi Electricity Access Project agreement is in form of a grant worth K4.6 billion as well as a credit amounting to K110 billion while the Malawi- Mozambique Interconnector
Project is in form of a credit amounting to K10.9 billion. Once implemented, the Malawi Electricity Access Project is expected to more than double Malawi‚Äôs electricity access from the current 11 percent to 26 Percent.
Through the interconnector project, Mwanamvekha said Malawi will diversify its energy sources through connection into Matambo, a major substation in the South African Power Pool (SAPP) system, which
Collects a substantial part of current and future power generated in Mozambique. On her part, Bird said the Bretton Woods institution is pleased to have signed the agreements with Malawi, saying increasing access to
Electricity among Malawians would be crucial as it means powering more households, businesses as well as public institutions such as hospitals and schools. He, however, urged the Malawi Government to
Implement the two projects in accordance with the provisions of the financing agreement and Ida‚Äôs general conditions as well as Malawi‚Äôs own Public Finance Management Act.
The use of renewable and clean energy through solar facilities is in tandem with Malawi‚Äôs 2019/20 National Budget measures as government has removed value added tax on solar facilities
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