Signed on Monday, the loan is the first phase of $325 million (Rwf271 million) loan that the World Bank committed to Rwanda to support the energy sector.
Rwanda will start to repay the loan after six years on the interest rate of 0.78%, and the full repayment will take 38 years.
The Minister of Finance and Economic Planning, Amb. Claver Gatete said that it is the biggest loan the World Bank offered to Rwanda specifically in energy sector. He said the loan will help the government achieve the target of having all households connected to electricity by 2024.
“We need electricity to light schools, homes for ordinary people, commercial institutions and development of industries… it will help us distribute electricity to population and ensure effective management by reducing losses,” he said.
Currently, electricity access is 40% and the government targets to increase the rate to 70% in three years’ time.
The State Minister in charge of Energy, Water and Sanitation in the Ministry of Infrastructure, Germaine Kamayirese said the loan will be used in repairing networks and help in reducing power blackouts due to old infrastructures.
The Country Manager for World Bank Group, Yasser El Gamal said that based on achievements in energy sector and the rate of electricity access, he is optimistic that the loan will support efforts in achieving the targets.
“Rwanda has ambitious targets especially in the energy sector. It is the country that wishes to distribute electricity to all its population in the near future. The government has done good reforms in this sector and now the target is enabling easy access by all residents. Rwanda should celebrate the achievements because we have not witnessed them elsewhere,” Gamal said.