HOUSING and Infrastructure Development Minister Vincent Mwale says government has halted plans of obtaining a loan of US$2.03 billion from the Exim Bank of China to commence the construction of the Chipata-Serenje railway line because it cannot sustain repayments.
Last November, Mwale said government was in the process of obtaining a financial loan agreement of US $2.03 billion from the Exim Bank of China to commence the construction of the Chipata-Serenje railway line.
Responding to a written question by Mkaika MMD member of parliament Peter Phiri, who wanted to know when the construction of Chipata-Serenje Railway Line would commence and who the contractor for the project was as well as the cost, Mwale said: “Construction of the Chipata-Serenje railway line would commence after financial closure was reached between government and the Exim Bank of China. The contractor is China Civil Engineering Construction Corporation. As at 2018, the total estimated cost of the project was US $2.03 billion.”
But in a brief interview with News Diggers!, the Chipangali PF member of parliament said government could no longer sustain the loan until it had another entity which it could partner with via a Private Public Partnership (PPP).
“We had said that we are changing from borrowing to PPP. That programme started a long time ago, long before I came to the Ministry, it was done. It should have been a loan, but we said we can no longer sustain that loan, we have to look for a PPP partner because government cannot borrow such a huge amount of money this time around, there is no such space. So, we said that we will find a PPP partner who will partner with government. We suspended it until such a time when we find someone who can partner on PPP. It has been put on ice for now,” said Mwale.