A Loan Agreement was signed today in N'Djamena between the Republic of Chad and the Kuwait Fund for Arab Economic Development, whereby the Fund will provide a Loan in the Amount of 4.0 Million Kuwaiti Dinars (equivalent to about US$13.6 Million), to the Republic of Chad, to participate in the financing of the Rice Production Development Project in the Plain of Chari-Logone.
The Loan Agreement was signed on behalf of the Government of the Republic of Chad, by Her Excellency Mariam Mohammed Noor, Minister of Planning and International Cooperation, while the Loan Agreement was signed on behalf of the Kuwait Fund for Arab Economic Development, by Mr. Hamad S. Al-Omar, Deputy Director-General of the Fund in attendance of Mr. Thamer Al-Failakawi, Regional Manager for West African Countries.
The Project aims to support the economic and social development in the Chari-Logone Plain at Sahr Governorate, by providing required and sustainable water from Chari River to irrigate about 400 ha of agricultural lands. Thus increasing rice production and other crops, improve farmer's income, and support Government food security strategy.
The Project consists mainly of civil and electromechanical works to develop the targeted lands and to construct about 10 water irrigation schemes. The Project also includes agricultural mechanization, inputs, training and extension services, consulting services for the preparation of detail design and the environmental & social study, tender documents and Project supervision, institutional support, in addition to the Project Management.
The total budgetary cost of the Project, including contingencies and interest during the construction period, is estimated at about African CFA Francs (FCFA) 9.14 Billion, equivalent to about 4.98 Million Kuwaiti Dinars, of which about FCFA 3.25 Billion, equivalent to about 1.77 Million Kuwaiti Dinars, is in foreign currency, representing about 36% of the total cost of the Project. The Fund's Loan in the amount of 4.0 Million Kuwaiti Dinars will cover about 80.3% of the total cost of the Project, while the Government of the Republic of Chad shall cover the remainder of the Project costs and any future increase in the cost of the Project from its own resources.
The Loan shall be for a period of 26 Years, including a grace period of 4 Years, and shall be repaid in 44 semi-annual installments, the first of which will be due on the first date on which interest or other charges will fall due, pursuant to the Loan Agreement, after the expiration of the said grace period. The Loan bears an interest rate of 1.5% per annum, in addition to a rate of 0.5% per annum to meet administrative costs and other expenses incurred in the implementation of the Loan Agreement.
This Kuwait Fund's Loan represents the 5th Loan extended by the Kuwait Fund to the Republic of Chad, as the Kuwait Fund has previously extended 4 Loans to the Republic of Chad, to finance projects in various sectors, with a total amount of approximately 12.3 Million Kuwaiti Dinars (equivalent to about US$41.82 Million). The Kuwait Fund has also provided the Republic of Chad with One Grant in the amount of approximately 14.8 Thousand Kuwaiti Dinars (equivalent to about US$50.32 Thousand). Kuwait Fund also administered Two Grants provided by the Government of the State of Kuwait to the Republic of Chad, the First in 1990, in the amount of approximately 760 Thousand Kuwaiti Dinars (equivalent to about US$2.58 Million), for a Water Supply Project, and the Second, under the Goodwill Fund, in the amount of approximately 1.1 Million Kuwaiti Dinars (equivalent to about US$3.74 Million).