Govt, Salima-LL water project financier still in talks
Khato Civils Pvt Limited says it is still waiting for the financier of the Salima-Lilongwe water project and Malawi Government to finalise discussions on financing to execute the project.
Speaking in an interview yesterday, Khato Civils Pvt Limited spokesperson Daniel Mwababa said the financier is still working on the loan agreement and it is only after the parties have signed that the contractors can start working on the project.
He said: “Government and the financier are discussing on the deal, the actual loan agreement.
“The financier is working on the agreement and after that it will have to be given to the Government Malawi for Reserve Bank of Malawi and Treasury to look into it.”
for the project
In March this year, Minister of Finance and Economic Affairs Sosten Gwengwe reported to Parliament about government’s intention to issue a guarantee for financing of the Salima-Lilongwe water project.
The project, valued at $313 million (about K315 billion), is to be financed through a loan from Quay Energy of Australia.
The loan has a repayment period of 25 years, grace period of 6 years, interest of 1.5 percent and one-off payment of structuring fees of 2.5 percent. The project was awarded to Khato Civils and South Zambezia joint venture.
Gwengwe said there are legal issues that have to be looked into in the agreement and there is need to align it to the laws of Malawi.
Mababa yesterday could also not tell when the process will be finalised to have the project start.
However, he said once the agreement has been signed it will not take time to have the project start as some of the equipment is already on the ground.
“Mobilisation will not be problem. The biggest equipment needed for the project is already on the ground,” said Mababa.
Ministry of Finance and Economic Planning spokesperson Taurai Banda yesterday confirmed that discussions on the financing of the project are still underway.
He said: “We are still in talks, once there is a new development, we will communicate.”
Asked if there is a time-frame when the talks are to be concluded, Banda said there is no time-frame but said he would communicate once there is a new development.
