Tunisia secures US$98m loan from Kuwaiti fund for drinking water projects

TUNISIA – The Kuwait Fund for Arab Economic Development (KFAED) has provided a loan of US$98.5 million (263 million Tunisian dinars) to Tunisia for drinking water projects in urban areas.

This is an additional financing the country’s National Company for the Exploitation and Distribution of Water (SONEDE) has received from KFAED.

The funds handed over to the Tunisian government on 29 December 2020 represents the fourth tranche of a total amount of US$500 million pledged by the State of Kuwait at the international investment conference “Tunisia 2020”.

Its objective is to support the country’s efforts to improve access to drinking water for the population. In Tunisia, the needs in water are constantly increasing; that is to say by 3% each year.

This sum is granted, through the KFAED, in the form of advantageous credits over 5 years, i.e., US$100 million each year, from 2016 to 2020.

The loan payback period is set at 30 years, including a 6-year grace period, with an interest rate of 2%.

Like the KFAED, several financial institutions are also supporting drinking water projects in the country. In October 2020, SONEDE signed a 38-million-euro financing agreement (nearly 123 million Tunisian dinars) with the European Investment Bank (EIB).

Using the funds acquired SONEDE will improve and develop drinking water transfer networks in the country’s governorates, notably by replacing pipes and building reservoirs, pumping stations, treatment plants and wells.

Tunisia is facing a steady increase in water needs – around 3% each year

The project is in line with national priorities, notably drinking water supply and sanitation services, targeting 35 urban areas in 17 governorates, directed to about 7 million inhabitants.

This project reflects the major efforts of the Tunisian authorities in the area of water and sanitation in line with the National Climate Change Adaptation Strategy and the Tunisia National Development Plan 2016-2020, specifically the “Green Economy, Pillar of Sustainable Development” component.

It is part of an extensive joint investment programme from the Ministry of Agriculture, Water Resources and Fisheries and SONEDE.

Meanwhile in neighbouring Morocco, the country seeks to tackle water scarcity by building Africa’s largest water treatment plant at a cost of MAD 10 billion (US$1 billion).

The project which will be built in the country’s capital Casablanca will have a capacity of 300 million cubic meters.

The seawater desalination project comes in the context of significant deficits of Morocco’s water reservoirs which has limited access to portable water and for undertaking farming.

In July the national average dam filling rate was 45%, down from an already-low 54% in September 2019.

In addition to building the mega plant, Amara said that his ministry has completed the construction of the water desalination station in Chtouka Ait Baha in the Souss-Massa region, and strengthened water flow to Morocco’s southern provinces.

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