AfDB Helps Boost Ghana’s Energy Sector
The African Development Bank (AfDB) Group and the government of Ghana on Tuesday in Tunis signed a loan agreement of UA 27.6 million, equivalent to US$ 44 million, to finance the power systems reinforcement project. The objective of the project is to help the country reduce electricity losses, improve the reliability of power supply and expand access to electricity for people living in the Kumasi area. Unreliable power supply is a major constraint on the country’s economic growth, greatly impeding the attainment of the country’s objective of becoming a middle-income country with a per capita income of US$ 1,000 by 2015.
Speaking during the signing ceremony, the AfDB vice president for infrastructure, Mandla Gantsho, said the "project provides for the construction of a second bulk point and the refurbishment of the first one to increase the amount of power which can be supplied to the Electricity Corporation of Ghana in Khumasi by the Volta River Authority."
The project is part of a wider Ghana Energy Development and Access Project (GEDAP), being financed by the World Bank, the Swiss Secretariat for Economic Affairs, the Global Environment Facility and the government of Ghana. Upon completion in five years, the GEDAP will provide services to some 135,000 households and businesses through the national grid and renewable energy resources.
The project, Mr. Gantsho said, would be the Bank Group’s fourth intervention in the country’s energy sector after the Ghana-Côte d’Ivoire transmission line, the Brong-Ahafo electricity network and the Ghana-Togo-Benin power interconnection projects. The first two projects were successfully completed in 1984 and 1994 respectively while the third project, which was approved in April 2007, is at the loan satisfaction stage.
A Bank Group review of its assistance to the country’s power and telecommunications sectors in November 2004 concluded that the first two operations had been very successful in terms of conformity with country-bank policy priorities and sustainability imperatives. The loan agreement was signed by vice president Mandla Gantsho for the Bank Group, while the Ghanaian Ambassador to Tunisia, Lawrence Satuh signed for his country.
Meanwhile, the AfDB and the Ghanaian government had earlier in the day signed a loan agreement of UA 40 million, equivalent to US$ 63.81 million, to finance the Northern Rural Growth Programme (NRGP). The ADF loan is expected to cover 58.5% of the total cost of the programme which is jointly financed with the International Fund for Agricultural Development (IFAD) and the Ghanaian government in order to help the country address the problem of poverty in the region by creating sustainable rural agricultural production and increasing income-generating activities.
Speaking on the occasion, AfDB Vice President for Sector Operations, Zeinab El-Bakri, welcomed Ghana’s decision to reduce regional disparities in its efforts to attain the MDGs, particularly the goal of eradicating extreme poverty and hunger. The programme, Vice President Bakri said, would help community empowerment efforts and increase food production and marketing. It will also support about 372,000 rural households in their efforts to reduce poverty, through the construction of key road infrastructure and improved water management infrastructure which will increase access to agricultural land as well as provide support to livestock development efforts, she stressed.
The dissemination of drought resistant varieties, irrigation development as well soil and water conservation are expected to also contribute to efforts aimed at enabling beneficiaries cope with the effects of climate change. The project will complement other ongoing projects and its design fully recognizes and responds to gender issues. The programme is also expected to increase access to agricultural resources for women and will help increase household incomes, she said.
She used the occasion to underscore the excellent relations between the AfDB and the government of Ghana. She assured the country of the AfDB’s continued support to programmes pursued by the Ghanaian government aimed at enhancing development in an environmentally sustainable manner.
The Ghanaian ambassador to Tunisia, Lawrence Satuh, who signed the agreement on behalf of his country, said the funds disbursed would help provide material support to his country in its efforts to translate its development policies into concrete achievements in two vital sectors of the economy: the energy and rural development sectors. Ghana has, since 1973, received substantial financial and technical assistance from the Bank Group.