In an effort to install clean water systems, Côte d’Ivoire authorities have signed a US$ 200 million funding agreement with German KfW, Ipex-Bank, Swedish Export Credit Corporation (SEK) and Bluebird Finance & Projects. The project involves the construction of 1.000 drinking water wells as well as water production plants and pipes to supply potable water to 189 villages in the country. The credit will be secured by the SEK and reinsured by Atradius Dutch State Business and will enable the use of Swedish and Dutch components on site. Under Dutch development cooperation policy, funds intended for poor countries can be redirected to de-risk investments for Dutch private corporations, diminishing the total amount of finance available for poverty alleviation. This government policy is controversial in the Netherlands and is challenged by Dutch NGO's working directly with local communities.
For the project, KfW Ipex-Bank will provide 55% of the capital with SEK providing the remaining 45% and Israeli Bluebird Finance & Projects acting as financial advisor. Israeli contractor Baran International Ltd. will be conduct the works and provide technology, engineering and construction solutions in building the infrastructure. The loan, with a tenure of 16 years, will be used to implement the “Baran” project which is part of the broader “Water for All” initiative of the Ivorian government which aims to improve access to safe freshwater and sanitation throughout the country and particularly in rural areas.
It is expected that works will be completed in four years and will impact approximately 2.5 million people, half of the country’s population. Per Edlundh, Director at SEK, said: “In order to get the project fully financed, a commercial down payment facility is provided by the lenders and SEK will for the first time take on Ivory Coast risk. I believe this structure may successfully be used in future deals in the region.” Ram Shalita, chief executive and partner at Bluebird, said: ““This landmark deal is the pure essence of our work: an export finance deal which will enable clean and accessible drinking water for 3 million people.”
Bluebird also stated that proper action was being implemented to install the new equipment cooperating with local populations and ensuring that they would be operational in the long term.