Government pens N$2,7 billion Financial Cooperation Agreement with Germany to aid economic growth
By Clifton Movirongo.
The government in collaboration with the German Government last week signed a financial cooperation agreement for N$2,7 billion in support of economic development and post-Covid recovery.
This was revealed in a joint statement by the two governments, adding that the loans will be used to fund the Namibia Water Sector Support Programme supporting new water projects to improve access, quality, and sustainability of water supply and sanitation countrywide.
One of the main objectives of the financial cooperation agreement is to provide for loans at reduced interest rates.
The project comprises three major areas, the first of which is N$334 million for the NamPost Funding Facility in support of micro and small enterprises, and low-income households to overcome the COVID-19 crisis. Additionally, the other two projects entail the Water Sector Support Programme II priced at N$1,25 billion, and the Renewable Energy Programme estimated at N$1,1 billion.
Accordingly, the Renewable Energy Programme which seeks to expand NamPower’s production capacities of renewable energy will establish the first major local wind farm with a capacity of up to 40MW located 30 km north of Rosh Pinah. Moreover, the project contributes to Namibia’s aspirations of becoming a hub for the production of green hydrogen.
“The funding of the roughly N$2,7 billion is provided by the German Government and forwarded to the KfW Development Bank for implementation. The three projects will directly contribute to the achievement of HPP II and the updated NDC helping to kick-start growth after the severe impact of the COVID-19 Crisis,” according to the statement.
German Ambassador, HE Herbert Beck, maintained his confidence that the agreed areas of the bilateral financial cooperation will make ‘a real difference’ to the people of Namibia. Ambassador Beck also added that the agreement will contribute directly to the implementation of the Harambee Prosperity Plan.
To date, German development cooperation with Namibia amounts to roughly N$26,8 billion.
“The enduring bilateral development cooperation is a central component of the special relations between Namibia and Germany and [the latter’s] continuous support to the Namibian Government. In 30 years of Namibia’s independence, Germany has always assisted in strengthening the country’s social and economic growth.”
“Namibia is very grateful for the continued support from Germany. The agreed financial support is for strategic investments in critical areas that will help the economy to recover and it will come in handy to help us build back better,” Finance Minister Ipumbu Shiimi concluded.