The Government of Rwanda and the Republic of Korea on Thursday, November 26, signed a loan agreement worth $ 66.2m (approx. Rwf65bn) to reinforce the country's target to achieve universal access to electricity by 2024.
The loan is concessional in nature and will be repaid in 40 years including a grace period of 15 years, at the interest rate of 0.01 percent annually.
Speaking after the signing ceremony, the Minister of Finance and Economic Planning, Uzziel Ndagijimana said that the support was timely.
"This will support our National Strategy for Transformation targets of 100 percent access to electricity for every Rwandan in 2024 from the current 54 percent," he said.
"We thank the Government of the Republic of Korea for the continued support and collaboration in many areas of our economy but most importantly agriculture, education, digitalization, and water and sanitation," he added.
According to the finance ministry, the project will support the grid extension of Gasogi, Mamba, Nyabihu, Rwabusoro and Nyabarongo power sub-stations as well as connecting transmission lines and line bays.
It is expected that once complete, the project will reinforce the national power system through expanding the transmission grid and provide stable power.
According to the Minister of Finance and Economic Planning, Dr. Uzziel Ndagijimana
In his remarks, Ambassador of the Republic of Korea in Rwanda, His Excellency Jin-weon CHAE, stressed Korea's commitment to partnering with Rwanda.
"Korea will continue its close partnership with Rwanda in its journey towards sustainable development. I believe this project will provide solid electricity infrastructure, which is vital for industrial development and improvements in the quality of life of Rwandans," he said.
How achievable is the target?
According to the Chief Executive Officer of Rwanda Energy Group (REG), Ron Weiss, though the country has a 44 percent gap to the universal connectivity to electricity target by 2024, there is hope that achieving the target is still possible.
He said: "We are committed and very sure that it is still possible to achieve this target by 2024. A lot of budget is needed in this regard, but we are in touch with the Ministry of Infrastructure and Minecofin to get all necessary resources."
In an interview with The New Times early this year, Weiss had said that the estimated total cost of achieving universal connectivity to electricity by 2024 was $1.5 billion.
The fund will be disbursed towards generation, transmission, distribution, and access.