European Investment Bank (EIB) has pledged new support for projects in the power and transport sectors after signing EUR 60 million (Kshs 6.7 billion) loan to support the “Last Mile Connectivity” project, targeting universal access to electricity for 300 000 Kenyan households.
The loan is part of a European “blended” financing package comprising a EUR 90 million (Kshs 10 billion) loan from the Agence Française de Développement and a EUR 30 million (Kshs 3.3 billion) grant from the European Union.
EIB Vice President Pim van Ballekom, responsible for operations in East Africa, commented: “Kenya is increasingly becoming a hub for the region on many levels. We as a bank must look at this from a very basic point of view, namely that there is a young and growing population with enormous potential, and that you need investments to support that momentum, both directly and indirectly. Thanks to today’s signature over 300.000 Kenyan households – up to 1,5 million people – will soon be connected to the electricity grid.”
The company also signed two other projects that are already at advanced stages, one being an extension of the existing Olkaria I geothermal plant. Here, the bank has committed a total amount of EUR 113 million – will support the addition of a 70MWe turbine, as well as the construction of the necessary wells, steam gathering system and interconnection facilities.
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Next to that, EIB pledged to finance an upgrade and widening of the Port of Mombasa access road, regarding the section of 42kms between Mombasa and Mariakani. The project aims to improve the safety situation on the road as well as alleviate congestion which causes delays for goods travelling through Mombasa. The project is co-financed by a concessional loan of EUR 50 million approved by the German Government and to be provided by KfW Development Bank, as well as a EU grant contribution and a loan from African Development Bank.
Just last week, the EIB signed a USD 17.5 million commitment into Catalyst Fund II, a Nairobi based growth equity fund supporting SMEs and Mid-Caps in East Africa. The fund has a target size of USD 175 million with which Catalyst intends to invest in up to 12 companies, with the goal of generating social and developmental impact benefits.
