Exim Bank of China freezes funding towards $2 billion Kafue Gorge power plant -Vixon Ncube
Have you ever wondered why the excitement of the coming on stream of the 750 mega watts Kafue Gorge Lower Power plant has suddenly gone quiet?
Well, new ZESCO chairman Vickson Ncube has disclosed that funding for the completion of the $2billion Kafue Gorge Lower project has been frozen. Exim bank of China is the official funder of the project.
Speaking during the ZNBC Sunday interview program, N’cube stated that the project funders of the 750 mega watts project which was expected to make Zambia a net exporter of electricity have frozen funding, with only one turbine brought into production.
The Kafue Gorge Lower Power plant which was to be completed by end of 2021 was to have 5 turbines, each producing 150MW, but only one turbine was brought into production, with the other four planned for launch by end of 2021.
Ncube stated that “there is no point of crying for the funders to unfreeze, to continue funding, so we have resorted to using our internal resources to complete the other four turbines”.
But with a change of government, from the Patriotic Front – PF to the United Party for National Development – UPNDs new dawn government in August 2021, analyst say the suspension of funding should be related to frosty relations between China and the new dawn government leaders.
The new dawn government is seen to be pro-western and have not given China the same enthusiasm. This may have compromised the historical and strong long term relations. It’s this diplomatic challenges that may have led to projects being funded by China and institutions from the east being put on ice.
When you check Zambia’s foreign debt stock, it’s easy to see how the about $3 billion funding from China was utilized with visible projects, while funding from Eurobonds which was also above $3 billion, there are limited visibility on how the funds were utilized.
Some analysts have even called for a forensic audit of the contraction and usage of Eurobonds. These funds seems not to have been allocated to specific tangible projects and therefore susceptible to graft.
Zambia has historically been a non-aligned country which has allowed the country to deal with both the East and the Western countries. This position is seen to be more strategic as the country risks to be turned into a geopolitical battleground that will result in Zambia being caught in the cross fire