Parliament on Friday authorised the Ministry of Finance, Economic Planning and Development to borrow K16.4 billion loan from European Investment Bank (EIB) for efficiency improvement at Northern Region Water Board (NRWB).
Unlike other water boards, NRWB covers all districts in the Northern Region.
Minister of Finance, Economic Planning and Development Goodall Gondwe said NRWB is losing a lot of water before reaching the intended consumers due to several leakages and that is one of the challenges that the funds under the loan will address.
Gondwe also said the money will be used to rehabilitate Lunyangwa Dam, by increasing the depth of the dam with one metre, to ensure that more water is harnessed.
“It is going to increase water supply by about 200,000 [cubic] metres,” Gondwe said.
Responding to the loan authorisation bill on behalf of Malawi Congress Party, Member of Parliament for Dedza East, Juliana Lunguzi, said as much as the party welcomes borrowing for efficiency improvement in the water boards, there is need to change the way board members for water utilities are appointed.
“If you look at the mismanagement of funds in these boards, in terms of corruption, you will agree with me that,” Lunguzi said.
The project is expected to run for four years and the interest rate for loan is 1.1 percent with a repayment period of 20 years, including a grace period of four years.
Last year, the EIB blacklisted Blantyre Water Board from being a beneficiary of the bank’s financing after an audit revealed irregularities ranging from fraud to poor documentation of projects fund.
The BWB had failed to explain how it used K6.6 billion loan that was given to it in 2009 for Malawi Peri-Urban Water and Sanitation Project.
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