House Approves US$40M Loan Agreement For Road Construction
Monrovia – The House of Representatives Thursday, September 21, 2017 approved a ‘Financing Agreement’ that would fund the pavement of the Gbarnga to Guinea Border road.
The project is valued at US$40 million which includes constructions and maintenance of roads from Monrovia (ELWA-Red Light) to the Guinea Border.
The bill entitled ‘Financing Agreement (Amending and Restating Financing Agreement) was recently presented by President Ellen Johnson Sirleaf to the legislature and it is under the Road Access Management Project between Republic of Liberia and International Development Association.
The bill was approved by members of the House of Representatives on Thursday, September 21, 2017 during the 63rd Day Sitting, based on a report of a Joint Committee on Ways, Means, Finance and Development Planning and Judiciary.
The purpose of the US$40 million loan is to support the Government of Liberia’s efforts in reducing the cost of road transportation from Monrovia to Ganta-Guinea border and to maintain the road in good condition for 10 years.
“That through output and performance-based road contracts, this instrument will create the opportunity to rehabilitate, upgrade, maintain periodically and routinely and install proper mechanism for control of road right of way from Monrovia to Ganta-Guinea Border,” the Joint Committee said.
“That as per the agreement, repayment is due on each June 15 and December 15 and will begin June 15, 2023 up to and including December 15, 2054, at the rate of 1.5625% of the principal amount of the credit.”
In 2011 the Liberian Government and the World Bank signed the agreement totaling an estimated US$249 million for the rehabilitation of the approximately 249-kilometer Monrovia (Red Light)-Gbarnga-Ganta-Guinea border road. This Liberia Road Asset Management Project (LIBRAMP) also provides for the maintenance of the road over a 10-year period.
The objective of the project is to support Liberia’s efforts to reduce transport costs and travel time along the road corridor from Monrovia to the Guinea border and to maintain the road in good condition over a 10-year period.
The total estimated project cost is US$249 million, of which about US$176 million is being provided from International Development Association – IDA (approx. US$68 million) through its credit to Liberia, and approximately US$109 million grant from the multi-donor Liberia Reconstruction Trust Fund (LRTF) administered by the World Bank.
The Oversight Committee (OC) of the LRTF has already approved the project concept and committed funds to co-finance the proposed project, through contributions and pledges received from the governments of Germany, Sweden, Ireland, the United Kingdom and Norway, the European Commission and the World Bank.