Cabinet nod for $115m AIIB loan for Waste Management Project

Thursday, 22 February 2018 00:00 - - {{hitsCtrl.values.hits}}

By Chathuri Dissanayake

Cabinet this week gave approval to finalise details on a loan facility provided by Asian Infrastructure Investment Bank, to the value of $115 million, to finance the Waste Management Project under the Ministry of Megapolis and Western Development, cabinet Co-spokesperson Minister Gayantha Karunathilaka said yesterday.

The project, designed to provide a comprehensive solution for the solid waste in Colombo, complete with a final disposal facility in Aruakkaru, is estimated to cost $274 million. Government has planned obtain the necessary financing through AIIB and International Bank for Reconstruction and Development (IBRD) of World Bank, through loan facility of $115 million each, with the state providing the remaining $44 million.

The Cabinet of Ministers had approved a proposal by National Policies and Economic Affairs Minister and Prime Minister Ranil Wickremesinghe to instruct the Department of External Financing to conclude negotiations with AIIB for the loan facility. The loan is repayable in 23 years, including a grace period of six years, and with an interest rate of six months LIBOR plus fixed Lending Spread of 1.15% on withdrawn loan balance per annum, the Cabinet was informed. Further, the loan facility is also subject to a Commitment Fee of 0.25% per annum, payable on the un-withdrawn loan balance and Front End Fee (FEF) of 0.25% of the loan amount.