Regional countries have accumulated $651.8 million in development loans
Trade and Development Bank, with a $4 billion asset base, had offered more than $2.62 billion in project development lending to its member countries, with $1.65 billion approved by the regional bank’s board going to the five EAC members.
The TDB loan is now an eight-year facility that will mature in 2025, but comes with a high interest rate of 6.7 per cent above the prevailing six-month London Interbank Offer Rate.
RwandAir was set to sign three aircraft lease agreements this year worth $300 million, guaranteed by the government, as it seeks to operate new routes across Africa and introduce longer haul connections to Europe, America and Asia.
In a letter to the managing director of the International Monetary Fund Christine Lagarde, seeking an increase in its ceiling on new external debt, Rwanda stated that in the first quarter of this year RwandAir contracted a lease for additional aircraft for the expansion of its fleet.
“Although the initial plan was to acquire two aircraft next fiscal year, an opportunity arose to acquire new aircraft following the folding of a European airline company, so RwandAir management quickly engaged the lease contracts.
Uganda which is expected to pay $109.8 million by the end of next year is currently caught up in a $226.83-million loan scandal after it emerged that the facility from TDB could have been used for purposes other than what it was borrowed for.
“The Minister of Finance, by false pretence, impressed upon parliament the justification for the loan, stating that the critical area for funding was medical supplies by the National Medical Stores. The Finance Minister thus received the money fraudulently,” reads part of the conclusion of the committee report.
“So far our bank has allocated $200 million for the SGR Central corridor project and another $200 million that will go towards the gas power plant. We are ready and willing to support Tanzania in its execution of various development projects in the country.