Geneva Convention Bill -- 18 July, 2008 Consideration Stage
to proposed New Tafo Booster Station
i i i . Cons t ruc t ion of Boos te r Pumping Station including 500 m3 reservoir
i v. Tr e a t e d w a t e r p i p e l i n e diameter 450 mm, length 22.1 kilometres to Koforidua
v . C o n s t r u c t i o n o f 5 Water re- servoirs, 144 m3, 3No. 60 m3 and 500 m3
v i . D i s t r i b u t i o n N e t w o r k Improve- ment for the New Tafo, adjoining and riparian towns and villages including 27.2 kilometres of HDPE pipeline ø 125 mm and 3.8 kilo- metres of HDPE pipeline ø 180 mm, and standpipes
vii. Spare parts supply.
5.0 Terms and conditions of the Mixed Credit
The terms and conditions of the Mixed Credit are as follows:
Total Contract Amount -- €17, 156, 600.00
A. Credit Agreement between GOG and Kingdom of Belgium
Loan Amount -- €7,801,886.56
Grace Period -- 10 years
Repayment Period -- 20 years
Maturity Period -- 30 years
Interest Rate -- 0%
Grant Element -- 68.89%
B. KBC Bank Loan
Loan Amount
-- €9,354,713.44
Grace Period -- 10 years
Repayment Period -- 20 years
Maturity Period -- 30 years
Interest Rate -- 4.79% p.a (fixed CIRR €)
Commitment Fee -- 0.25%
Geneva Convention Bill -- 18 July, 2008 Consideration Stage
Management fee -- 0.5%
Grant Element -- 6.30%
Weighted Grant Element (A & B) -- 37.34%
6.0 Observations
The Committee observed that the benefits expected to accrue from the project include:
i. Improved access to potable water supply to the supply areas.
i i . Improved level of service by increased coverage in project area.
iii. Growth in productivity of the inhabitants leading to economic development and growth and thereby reduction in poverty.
iv. Boosting of business opportunities mainly industrial and commercial activities.
v. Maximization of the social and health benefits of clean, safe and reliable drinking water.
The Committee was informed that the water to New Tafo Township and environs under this contract is to be supplied through pumping from the water treatment plant at Bukonor, currently under construction. It will also supply treated water to all the communities' en route to New Tafo such as: Oyoko, Suhyen, Jumapo, Kofikrom, Sokode Dwaso, Kukurantumi, New Tafo, Old Tafo, Maase, Aiyinasin and Oseim.
The Committee noted that the population to be served is estimated to be about 50,000 and that the project would be completed within 24 months after commencement of the works.
The Committee observed that the mixed credit facility from the Government of Belgium and KBC Bank of Belgium has a weighted granted element of 37.34 per cent. This meets Government's minimum concessionality requirement and therefore it is concessional.
The Committee also noted that clause
14 of the Loan Agreement between GoG and KBC and article 5 of the Agreement between GoG and the Belgium Government require that the project is to be waived from the payment of local taxes and levies. The Minister assured the Committee that a formal request for waiver would be brought to the House for approval.
7.0 Conclusion
After carefully considering the strategic importance of the project and the need to ensure its smooth implementation, the
Committee concludes that the request is necessary and therefore respectfully recommends to the House to adopt this Report and approve by resolution the Mixed Credit Facility between the Government of Ghana and Government of Belgium/ KBC Bank for an amount of €17, 156, 600.00 for the Implementation of the Koforidua Water Supply Project (New Tafo Water Supply System) in accordance with article 181 of the Constitution and section 7 of the Loans Act, 1970, ( Act
335).
Respectfully submitted.
