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Obtaining Financial Assistance from the French Agency for Development for the Implementation of Green Power Development and Energy Efficiency Improvement Investment Program Tranche 2

 

 

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The sufficient energy supply and energy security are critically important in economic growth and prosperity. The energy sector is strongly correlated with all other sectors of the economy including production, commercial and services. Therefore, energy planning has to always be made in a sustainable manner, within the framework of current and future energy demand against available energy resources.

 

While ensuring a continuous supply of  electricity,  managing  a  strategic  balance  between  indigenous  energy  resources  and  imported  fossil  fuels and coal is a major challenge faced by the Sri Lanka’s power sector. Ceylon Electricity Board has an ambitious capital investment plan for next 10 years to maintain 100% electrification while improving supply quality and reliability.

 

In this background, it is expected to implement the tranche 2 of the Green Power Development and Energy Efficiency Improvement Investment Program which will include three major components; i.e. (i) Transmission infrastructure enhancement; (ii) Efficiency improvement of medium voltage network and (iii) demand side management improvement for energy efficiency through development of a smart grid and metering pilot subproject. AFD has already provided financing of Euro 22 million for the implementation of Tranche 1 of the Programme.

 

Total cost of this project is estimated at US$ 260 million. Asian Development Bank has already provided USD 150 million loan to finance a part of the project. French Agency for Development (AFD) will provide Euro 30 million loan to finance a part of the total project cost and the balance will be borne by the Ceylon Electricity Board.

 

In this connection, Dr. R H S Samaratunga, Secretary of the Ministry of Finance and Mass Media on behalf of the Government of Sri Lanka and Mr Martin Parent, Country Director of AFD Sri Lanka Resident Mission on behalf of AFD, signed a Credit Facility Agreement relevant to the above loan on 17th October 2018 at the Ministry of Finance and Mass Media.

 

 



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The Government of Sri Lanka has entered into a loan agreement worth of USD 50 million with the Asian Development Bank to finance the Rooftop Solar Power Generation Project. 


The main objective of this project is to support government’s “Battle for Solar Power Programme” to achieve the target of 200 MW by 2020 and 1000 MW by 2025 through solar power generation. Clean and sustainable power generation will be enhanced through the proposed project by increasing debt facilities and funding for the rooftop solar power generation, developing solar rooftop market infrastructure and bankable subproject pipeline. It is expected to add 50 MW to the national grid under this project. 


The Department of Development Finance of the Ministry of Finance and Mass Media which is the Implementing Agency of the project, will coordinate with the selected financial institutions to provide credit facilities to the customers to purchase Rooftop solar panels from reliable suppliers who registered under the Sustainable Energy Authority. The Ceylon Electricity Board (CEB) and Lanka Electricity Company Ltd (LECO) will support the project implementation by providing technical recommendations to the Financial Institutions regarding technical proposals of the applicants (customers) and reviewing and approving applications for connection of solar rooftop systems to the distribution network and confirming quality of generated power. In addition, customers will be benefited financially through one of the system among net metering, net accounting or net plus as a result of connecting solar electricity generated by this project to the national grid. 


The total investment cost of this project is USD 59.8 million of which USD 50 million will be provided by ADB. Equity contribution by customers for the subprojects will be USD 9.8 million. 
In this connection, Dr. R H S Samaratunga, Secretary of the Ministry of Finance and Mass Media on behalf of the Government of Sri Lanka and Ms. Sri Widowati, Country Director of ADB Sri Lanka Resident Mission on behalf of ADB, signed a Loan Agreement on 18th September 2018 at the Ministry of Finance and Mass Media. 

 

 

 

 

 

 

 

 

 

USD 453 mn from ADB for Mahaweli Water Security Investment Program

-      The Total Investment USD – 675 m

The Mahaweli Water Security Investment Program is one of the major ongoing investment program currently being implemented under the loan assistance of the Asian Development Bank(ADB) The total investment cost of this program is USD 675 million of which USD 453 million will be provided by ADB under Multi - tranche Financing Facility (MFF). The Government of Sri Lanka has already signed two loan agreements with ADB to obtain USD 150 million to finance the first tranche of the programme.

Three major investment projects; Upper Elahera Canal Project, North Western Province Canal Project, Minipe Left Bank Canal Rehabilitation Project will be implemented under the above investment program. The construction of new and improved water conveyance and storage infrastructure under this program will increase the productivity of agricultural lands in the North Western, North Central and Central Provinces. Constructions of 158 Km canals including 38 km of tunnels are being implemented. In addition construction of two new reservoirs with storage capacity of 36 MCM (Million Cubic Meters) are also included in the program. Rehabilitation of 74 km Minipe Left Bank Canal is also programmed under this investment.

25,000 farmer families under Upper Elahera Canal Project, 40,000 farmer families under North Western Province Canal Project and 15,000 farmer families under Minipe Left Bank Canal Rehabilitation Project will be directly benefited through this whole program. In addition, provision of safe drinking water for people live in those areas will help to prevent Chronic Kidney Disease. (CKD)

 

The OFID has been a major Development partner of Sri Lanka providing financial assistance to implement a number of strategically important development projects during the past two decades. Under current portfolio, OFID provides financing for road and irrigation sectors. The lines and working pattern of our workforce is bound to change with both emerging technologies and changing demand for skills. Therefore, it is necessary for Sri Lanka to align its education and skills development programme with emerging needs. The Vocational Training, Science, Technology and Research will be coming together for providing professional skills needed. The government recently introduced the 13 year mandatory education policy. It is compulsory to provide required infrastructure facilities and equipment with modern technology for practical activities as well as training of teachers. Accordingly, the Ministry of Education expects to construct technical laboratories and provide required machinery and equipment to the schools through the above project. The total cost of the project is USD 60.70 million. The OFID has agreed to provide a loan of USD 50.0 million in support of the above project. The balance USD 10.70 will be borne by GOSL. The Loan Agreement has been signed today, 3rd July at the Headquarters of OFID in Vienna, Austria by Dr R.H.S. Samaratunga, Secretary to the Ministry of Finance and Mass Media on behalf of the Government of Democratic Socialist Republic of Sri Lanka and Mr. Suleiman J. Al-Herbish, Director General of OFID on behalf of the OPEC Fund for International Development. Ministry of Finance and Mass Media Colombo 01 Sri Lanka On 3rd July 2018

 

The Government of Sri Lanka obtained ADB Financial assistance of USD 100 million in 2016 to finance the Small and Medium-Sized Enterprises (SME) Line of Credit Project. The objective of the project was to strengthen the SME sector in Sri Lanka by facilitating access to finance and expand the employment opportunities in the sector. The project is being successfully implemented and given the importance of this intervention, the Government of Sri Lanka decided to obtain an additional financing through a loan of USD 75 million with the intention to scale up the ongoing SME Line of Credit Project.

The Additional financing will be utilized to deliver four outputs through the project : Increase of financing to SMEs through intermediaries, Development of innovative SME financing scheme, Enhancement of capacity of SMEs in targeted clusters for accessing financial services and Strengthening of international competitiveness of information and communication technology/business process outsourcing (ICT/BPO) cluster.

The additional loan of USD 75 million is planned to be disbursed in 3 tranches of approximately USD 25 million each. The Government will relend the loan funds in local currency to participating banks through three semiannual allocations based on the banking sector’s average weighted deposit rate. The proceeds of the loan will be available to the participating banks for relending to the SMEs based on the previously agreed targets between the Asian Development Bank and the Government specially focusing on first time borrowers, women-led SMEs and SMEs located outside of Colombo etc. Further, participatory banks should achieve SME on-lending targets before participating in subsequent allocations.


The Ministry of Finance and Mass Media will be the Executing Agency of the SME Line of Credit (Additional Financing). The Department of Development Finance will be the Implementing Agency for Outputs of Increase of financing to SMEs through intermediaries, Development of innovative SME financing scheme and Export Development Board will be the implementing agency for outputs of Enhancement of capacity of SMEs in targeted clusters for accessing financial services and Strengthening of international competitiveness of information and communication technology/business process outsourcing (ICT/BPO) cluster. The overall project is scheduled to be completed by 31st March 2020.

In this connection, Dr. R H S Samaratunga, Secretary to the Ministry of Finance and Mass Media on behalf of the Government of Sri Lanka and Ms. Sri Widowati, Country Director of ADB – Sri Lanka Resident Mission on behalf of ADB, signed the loan agreement to obtain USD 75 million on 16th February 2018 at the Ministry of Finance and Mass Media.

 

 

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