Monday, June 17, 2013

China revives Uganda's biggest power dam with $500 mln credit

China revives Uganda's biggest power dam with $500 mln credit
Source: Reuters - Fri, 14 Jun 2013 12:34 PM

KAMPALA, June 14 (Reuters) - China has provided credit worth $500
million to Uganda to help pay for the construction of a large Nile River
hydropower dam at Karuma, a government document said on Friday, reviving
the $2 billion project stalled for years by a lack of money.

Construction of the 600-megawatt Karuma dam is expected to start before
the end of 2013 and likely to take five years to complete, the
government has previously said.

It would be Uganda's biggest hydro-electric dam, after the recently
commissioned 250 MW Bujagali power dam, also on the Nile. Most of
Uganda's 550 MW power output comes from hydropower generation.

The project's funding will come from government co-financing amounting
to $700 million and $500 million from China, showed a 2013/14 budget
document from the ministry of finance seen by Reuters on Friday. The
government plans to raise the rest from other development agencies.

China, as elsewhere in sub-Saharan Africa, has rapidly expanded
investment in Uganda in recent years, funnelling vast sums into projects
ranging from gleaming public office blocks to highways, hospitals and
underground internet cables.

Uganda is banking on Karuma to generate cheap, sufficient power to meet
fast-growing energy needs and support an economy eyeing double-digit
growth rates once crude oil production starts, anticipated in 2017.
(Reporting by Elias Biryabarema; Editing by James Macharia and Jeff Coelho)

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