Taps turned to build vast new water plant in Rwanda

KIGALI: The Emerging Africa Infrastructure Fund (EAIF) yesterday announced the signing of the financing for a large-scale water treatment facility in Kigali, Rwanda.

It is the first Bulk Surface Water Supply in sub-Saharan Africa using a public/private partnership (PPP) model.

It is also one of the few sub-Saharan Africa water infrastructure projects being done on a Build, Operate and Transfer (BOT) basis and is EAIF’s first water project in a big city.

The site for the new facility is at Kanzenze, south of Kigali. Water will be drawn from the Nyaborongo River to be treated before distribution to domestic, commercial and industrial customers.

The plant will have the capacity to supply up to 500 000 people in Rwanda’s capital, providing 40 million litres of fresh, clean water a day.

A member of the Private Infrastructure Development Group (PIDG), EAIF is mainly funded by the governments of the UK, The Netherlands, Sweden and Switzerland, as well as private sector banks and FMO, the Dutch development bank and its German equivalent, KFW.

EAIF, the mandated lead arranger of the financing, is lending Kigali Water Limited (KWL) a fully-owned subsidiary of Metito, one of the world’s largest water infrastructure and utility providers, $19 million (R261m) of Senior Debt and $2.6m of Junior Debt. The African Development Bank is providing another $19m of Senior Debt. All of the loans are for 18-year terms.

The lenders are covering $40.6m of the capital cost of the $60.8m project. The balance will be provided as equity finance by Metito. The project also benefits from a $6.25m grant from PIDG’s Technical Assistance Facility.

The grant was a significant element in the creation of the financial package. Another PIDG facility, DevCo, which is managed by the International Finance Corporation (IFC), provided initial financial support to the Government of Rwanda for the legal, financial, technical and environmental feasibility assessments of the project. The IFC advised Rwanda’s government on this work.

It ensured an optimal solution for the long-term needs of Kigali and recommendations for a public/private partnership structure that best suited the development objectives of the Rwandan government.

The country aims to see 100% of its 12.4 million people having reliable access to clean water within the next few years.