Government loans $150m to finance proposed transport improvement project

Government of Ghana has obtained a loan facility from the International Development Association (IDA) to the tune of $150 million to be repaid in about 20 years, to finance some selected road projects in the Country.

This followed the adoption of the report of the Finance Committee on the Financing Agreement between the Government of the Republic of Ghana and the International Development Association (IDA) for an amount equivalent to One Hundred and Ten Million and Six Thousand Special Drawing Right (SDR110, 600, 000) [equivalent to US$150 Million] to finance the proposed Transport Improvement Project.

The proposed Transport Sector Improvement Project (TSIP) has been developed to among others, support the development of road infrastructure, improve road safety, and strengthen the capacity of the Sector Agencies and to foster Regional integration.

According to the committee report, the project aimed to reduce travel time on selected parts of the Classified Road Network in Northern Ghana, promote road safety and strengthen the Institutional Management of the Transport Sector.

In relation to the expected benefits of the Project, the Committee observed that “the project is expected to reduce travel time on the estimated 370km roads to be rehabilitated/upgraded and strengthen the institutional management of the transport sector by employing Performance Based Contracting (PBC) technology.”

“The PBC will comprise designing rehabilitation works and providing maintenance services for selected roads and payment made in lump sum upon achieving the performance targets.”

According to the report, “this contracting method will therefore maintain the roads at a certain standard, ensuring efficiency of public expenditure and value for money by cutting down on the cost overruns and delays in project implementation.”

The report further notes that, the project will create job opportunities during the rehabilitation of the road network and the share of rural population with access to market and support agribusiness as well as feeder road to be constructed under the project will help link agriculture value chain.

In wrapping up the debating, the Chairman of the Finance Committee, Dr. Mark Asibey-Yeboah detected that “the project to be immensely important towards improving road infrastructure and enhancing road safety in the country whilst also strengthening the capacity of transport sector agencies for improved service delivery.”

Story Edzorna Francis Mensah
gbcghanaonline
---DECRYPTED---