Much of the funding is coming from the World Bank, one of the sceptical Western donors demanding more reforms from the GNU.
"The AfDB took over the Zimbabwe Fund from the World Bank in May 2010 to support our economic recovery efforts," said Economic Planning and Investment Promotion minister Tapiwa Mashakada. "We have signed a $72million agreement that would primarily target our water and sanitation and energy development."
The bank said it would work closely with the Zimbabwean government to ensure the programme's objectives were met.
Of the $72 million, $30 million will bankroll rehabilitation and development of water and sanitation infrastructure. Almost all cities in Zimbabwe have suffered critical water shortages, with Harare the worst affected due to burgeoning demand.
Government is earmarking another US$35 million for energy development.
"We have set a target for the rehabilitation of the Hwange Thermal Power Station," Mashakada said. "As you know, the electrical power situation in Zimbabwe is critical. We would also work on critical infrastructure development projects and that would see some funds being channelled towards them."
The Hwange Thermal Power Station generates 400 MW, of the country’s total 1,100 MW of electricity, a paltry supply when set against demand of 2,000 MW. The country imports up to 500 MW during peak periods, but the regional power pool is not generating enough to meet rising demand.
The bulk of Zimbabwe's electricity imports come from Mozambique, but it also buys from Zambia and Democratic Republic of Congo.
"The funds will bolster our development efforts, especially augmenting the funds we have already received from the PTA Bank and Afrexim Bank for our development efforts," Mashakada said.
AfDB executive director Ebrima Faal said Zimbabwe must clear its external debt to access more lines of credit.
Post published in: Business