Namibia secure Germany loan for power projects

Windhoek – Namibia has obtained a 45 million Euro (roughly N$616 million) loan from the German government to fund power related schemes, expand transmission networks and to implement projects for renewable energy.

The loan will back the power supply gap that the country is facing, with key projects to be financed through the loan being the rehabilitation of the Ruacana Hydro Power Station and the construction of transmission lines between Gerus-Otjikoto and Kuiseb-Walvis Bay.

The intergovernmental loan agreement will be facilitated through the Kreditatstalt für Wiederaufbau (KfW) and NamPower to ensure stable power supply for Namibia in the short and long term.

Namibia’s other existing loans through KfW have gone towards funding the Hardap Dam Rehabilitation, Trans-Caprivi Highway, rural basic communications, upgrading the port of Walvis Bay, Windhoek water reclamation infrastructure, Oshivelo-Oshakati road rehabilitation, labour-based road construction, Mururani veterinary gate at Rundu and Ondangwa-Oshikango road rehabilitation.

Speaking at the signing ceremony on June 25, 2015 in Windhoek, Namibia’s Minister of Finance Calle Schlettwein said that implementing renewable energy programmes is crucial and in line with the country’s policy to meet several targets such as energy security and sustainability.

“It identifies the Programme on the Promotion of the Use of Renewable Energy Sources as responsible for directing Namibia’s available resources for maximum social and economic benefit, taking into account long-term environmental concerns while giving priority attention to the country’s development needs,” he emphasised.

The Finance Minister reflected on the Namibian and German professional and technical relationship, saying that a number of German development organisations, such as the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), the KfW Development Bank and its subsidiary the German Investment and Development Company (DEG), Federal Institute for Geosciences and Natural Resources (BGR) and International Centre for Migration and Development (CIM) introduced critical programmes and projects to the benefit of Namibia. 

He also noted that since Namibia’s independence in 1990, intensive bilateral relations have developed between Namibia and Germany through official development assistance amounting to more than 800 million Euro.

“To achieve our development agenda, as set out in NDP4 (National Development Plan), Germany is continuing to support Namibia mainly in three priority areas: natural resource management, sustainable economic development and transport,” he added.

On his part, German Ambassador to Namibia, Onno Hückmann said that Namibia is one of the key partner countries and the German government acknowledges its special historic and moral responsibility towards Namibia, which is also reflected in the scale of German development funding with the highest per capita input in Africa. 

“Germany is supporting the Namibian government in mitigating climate change and improving energy security by promoting renewable energy sources and reducing imports of electricity. And it is in the context of that last point that we agreed on a programme of 45 (Million Euro) today to support renewable energy and energy efficiency,” he pointed out.

He said that the agreement would lay the foundation for a further increased support by the German government towards securing Namibia’s energy security.

“And we very much welcome Namibia’s plans of drastically increasing the contribution of renewables in its energy mix. Germany is equally facing a big challenge in radically transforming its energy system towards a bigger share of renewable energy and increased energy efficiency.”

Other areas of cooperation between Namibia and Germany, include undertaking community development measures in areas inhabited by those ethnic groups that endured particular suffering under German colonial rule; mitigating climate change and improving energy security by promoting renewable energy sources; reducing imports of coal-based electricity from South Africa and improving the enabling conditions for the private sector, which includes supporting SMEs and promoting the establishing and managing community forests and national parks.

July 2015
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