The Mozambican government has approved today through EDM, the country’s national energy company, a US$81,3M (£61,8M) facility as part 1 of an emergency funding totalling US$162M (circa £123,1M) for the rehabilitation and upgrading of the country’s energy supply network.
The projects will address the electricity deficit in Maputo, Lichinga, Nampula, Quelimane, Pemba, Nacala and Anchilo. They are meant to strengthen the transmission and distribution lines to avoid possible fatal breakdowns, as well as to guarantee the quality energy flow and to expand access in areas not covered;
The DBSA (Development Bank of Southern Africa) has provided finance to the Government of Mozambique’s national energy utility, Electricidade de Mocambique, EDM while BNI (Banco Nacional de Investimento) was assigned the implementation of the Program with the responsibility of mobilising finance within terms and conditions adjusted to the operating and financial reality of the company, using their role as Development and Investment Bank as well as their skills in the advisory and financial structuring component.
The facility has a 15 years maturity with concessional conditions under the global concessionality level, as it includes the Power Efficiency and Rehabilitation Project (PERIP) and the Short Term Investment Priority Project (STIP) backed by a sovereign guarantee issued on the basis of current structure for its approval and the viability of EDM’s financial cash flows illustrated by the financial model duly audited and validated by DBSA.
The signing of the Agreement reflects the successful financing mobilized by BNI in partnership with DBSA, validated by EDM in terms of technical and financial conditions combined with the company’s operational reality.
BNI and DBSA are strategic partners as part of a longstanding MOU where the objectives are to forge localized support and to enhance regional DFI partnerships and cooperation.