EIB approves US$35.7m loan for clean water supply in Malawi

MALAWI – The European Investment Bank (EIB) has approved $35.7 million loan to extend the drinking water network in southern Malawi.

The project is to be implemented by the state-owned Southern Region Water Board (SRWB). The soft loan is to be repaid over 20 years with a grace period of 5 years.

The EIB funding is for the extension of the drinking water network in the southern region of Malawi, particularly in Balaka and Liwonde.

According to the SRWB, part of the funding will be used for the development of a power plant to diversify its operations.

The SRWB did not disclose details on the nature of the facilities to be built, nor their capacity but the state-owned company estimates that the drinking water project in these two cities will supply some 150,000 people until 2050.

The SRWB said work on the project will start as early as March 2022 in the southern region of Malawi and will be completed by August 2023.

“The Government of Malawi is also supported by the Exim Bank of India which opened a US$215.68 million line of credit to finance the construction of the Likhubula River water supply system in Mulanje, southern Malawi”

The project will ultimately improve the East African country’s national household drinking water coverage, estimated at 67% according to the United Nations Children’s Fund (UNICEF) 2020 report.

According to the same source, just 77% of Malawi’s water points are functional while the remainder are non-functional due to obsolescence, deterioration of catchments, neglect, lack of spare parts and inadequate community water management structures.

In its latest policy to provide all Malawians with safe drinking water, the Government of Malawi is also supported by the Exim Bank of India which opened a US$215.68 million line of credit to finance the construction of the Likhubula River water supply system in Mulanje, southern Malawi.

The funds will also be used to establish and expand the water supply system in the Blantyre Water Board’s areas of jurisdiction.

According to the same report, poor sanitation and hygiene are major contributors to the burden of disease and child survival, costing Malawi US$57 million each year, or 1.1 per cent of national GDP, due to health costs and productivity losses.

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