HomeNewsAfDB launches $65m multi-donor trust fund

AfDB launches $65m multi-donor trust fund

-

The AfDB has launched a $65 million multi-donor trust fund for Zimbabwe called ZimFund, which has brought huge fiscal relief to the cash-strapped Treasury, currently unable to commit funds to infrastructure development or rehabilitation owing to a lethal consumption trap.

Water and power top the catalogue of Zimbabwe’s utility woes.

The Tunisia-based multilateral lender hatched the trust fund as a hybrid funding deal that falls outside its conventional lending business to help Zimbabwe rebuild its dilapidated power transmission and distribution network and water and sanitation infrastructure.

AfDB has already pieced up $42 million for the social development purse, which will be administered locally as a programme fund, $35,5 million of which has already been credited to the aid account.

The benefactors comprise traditional Western donors – Australia, Denmark, Norway, Sweden and the United Kingdom, none of which has good diplomatic ties with the recipient.

Ironically, the largest commitments come from Zimbabwe’s fiercest critics Germany, Britain and Australia, which have donated $23 million, $15,1 million, and $9 million, respectively.

Germany’s contribution is, however, still awaiting parliamentary approval. Denmark, Norway and Sweden have also disbursed $5,1 million, $7 million and $5,3 million in that order.

AfDB head of mission Damoni Kitabire on Monday said the multilateral lender had set up a ZimFund programme oversight committee, which has already approved two projects on power transmission and distribution and water and sanitation worth about $58 million.

“The programme oversight committee of the ZimFund became effective last week,” Kitabire said.

“The programme oversight committee requested the bank (AfDB) to proceed with preparation of the appraisal reports for the two projects. The team preparing the water project is currently in the country working on the details of the project, while the team preparing the power project is expected in the country next week.”

The water project targets five urban areas, namely Harare, Mutare, Masvingo, Kwekwe and Chegutu, while the power projects will fund the rehabilitation of Zesa’s power transmission and distribution network, as well as recoup Hwange Power Station’s environmental and safety management.

AfDB’s programme oversight committee is expected to review the appraisal reports for the two projects next month.

Recent Posts

Stories you will enjoy

Recommended reading