Bahrain okays $600m loan deals for power projects
Manama, April 12, 2011
The Shura Council has approved four new $600 million (BD226.8 million) loan deals with three GCC countries to help with new electricity projects in Bahrain.
Councillors backed Bahrain's move to get the loans from the Abu Dhabi Development Fund, the Kuwait Fund for Arab Economic Development and the Saudi Fund for Development for 220 kilovolt and 66kV electricity networks.
Bahrain will pay two per cent interest on the Saudi loan, 2.5 per cent on the Kuwaiti loan and 4.5 per cent on the Emirati loan.
The Saudi fund will also provide Bahrain with electricity supply and distribution apparatuses and equipment at an interest rate of 5.75 per cent.
Electricity and Water Authority (EWA) chief executive officer Dr Abdulmajeed Al Awadhi said the loans would help Bahrain's electricity networks over the next five years.
'These loans will help us in the current supply and distribution of electricity in the country, especially in our four power plants in Al Dur,' he said.
'The projects we will use this funding for will speed up the implementation of the unified GCC electricity network and this will give member states the chance to use each other's local networks.'
Council financial and economic affairs committee chairman Khalid Al Maskati said the loan would further develop the country's electricity infrastructure.
'It will certainly be a boost to the current electricity stations and distribution networks that are under pressure with Bahrain seeing huge development,' he said.
'These loans will help the government offer better services to the public and from what I see it has no plans to increase fees.'
Council first vice-chairman Jamal Fakhro said the loans were so low in interest and that Bahrain had been presented with golden deals.
'For our infrastructure to develop, Bahrain is in need of these loans and the government is very fortunate in getting them at such low rates and it is a golden opportunity that we are backing.'
Minister of State for Shura Council and Parliament Affairs Abdulaziz Al Fadhel said the government had an ambitious plan to meet demand on electricity.
'In Bahrain it surpasses international norms by 12 per cent, which is high, but if we take into consideration that the country is developing we will notice it is being used on new housing projects,' he said.
'To ensure that development is in line with electricity demand we have decided to go for these loans and thankfully the GCC funds were there to present us with good deals.
'We are now working on the unified GCC electricity network and this requires proper facilitation and through projects associated with these loans we will not just develop our local power but also be a part of the Gulf network.'
Meanwhile, the council approved a new law that will have GCC nationals working as civil servants in Bahrain's government jobs getting equal treatment as their Bahraini counterparts.-TradeArabia News Service