February 5, 2016

Kenya borrows Sh20bn for new dam

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Kenya has signed a Sh20 billion ($200 million) financing agreement with the World Bank for the construction of a dam at the ongoing climate talks in Paris.

The construction of Mwache dam in Kwale County is expected to serve residents of the country’s coastal city of Mombasa with 186,000 cubic meters of water a day. It will also supply residents of neighbouring Kwale County.

Mombasa County Governor Hassan Joho, who signed the deal along with Water and Irrigation Services Cabinet Secretary Eugene Wamalwa, said the dam would ease a biting water deficit where the county only supplies 46,000 cubic meters to residents.

“This dam will give us surplus water that we will distribute to other counties,” Mr Joho said.

This financing is part of a larger project under the Paris Pact Flagship Project that targets to build resilient water systems in cities. Last July Kenya also took commercial loans totalling Sh34 billion from Italian and French banks to finance the construction of Itate dam.

The Paris talks have attracted a lot of international partnerships such as the Lima Paris Action Agenda, which is mobilising large-scale financing to protect the most vulnerable people from the impact of climate change.

Other than the $200 million pledged by the World Bank for Kenya, the financial institution has also pledged a further $2.2billion to go towards conserving the Lake Chad basin which is experiencing serious water stress.

The water body, which once stretched for 25,000 square kilometres, has shrunk to just 2,000 square kilometres today.

The French government-affiliated financial institution Agence Française de Développement (AFD) has pledged €50 million to Senegal to go towards protecting at least 300,000 people from the risk of flooding.

Countries currently impacted by El Niño have also been big winners at the talks with the announcement that the European Union will provide $125 million to support the affected in Africa, the Caribbean and Latin America.

Kenya is currently grappling with mounting debt as unnecessary spending and theft leaves Treasury with no funds to run the government.


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