Zambia gets $285 million China's ICBC loan for power line

Zambia’s state- run power utility said China's largest lender Industrial and Commercial Bank (ICBC) will loan Zambia 285 million dollars for an electricity line linking southern and eastern Africa.

The Managing Director of Zambia's power company Zesco, Ernest Mupwaya, said on Monday that construction of the power line will start in November 2011 and will be done by China's TBEA.

China has been investing across Africa as it seeks to secure raw materials to feed its own rapid growth.

Expected impact

During a signing ceremony for the loan, Mupwaya said; "This development ... will not only improve security and reliability of supply but also enhance cross-border power trade."

The loan

The loan is for the 365 kilometres stretch that falls within Zambia and will be paid over 20 years, with a five-year grace period.

The interconnector line will link Zambia, Tanzania and Kenya and should boost mineral exploration, agriculture and tourism in the region, he said.

The line will also help the development of greenfield hydropower stations in Northern Zambia whose construction, analysts say, continue to be hampered by lack of connectivity to the national grid.

REUTERS/Williams