YANGON — President U Win Myint has asked Parliament to approve a $298.9 million loan from the Asian Development Bank (ADB) to be used to improve the electricity network in seven of the country’s states and regions.
Deputy Minister for Electricity and Energy, U Tun Naing, told lawmakers during the parliamentary session on Tuesday that the loan is expected to fund a six-year project (2019-2025) that will be implemented in Yangon, Irrawaddy, Tanintharyi and Bago regions and Mon, Karen, and Rakhine states.
He said the project aims to meet an increasing level of power consumption, to electrify rural areas, as well as to improve the existing system.
The project will include two parts: electricity transmission and electricity distribution, he explained, including a computerized electricity management and bill-collection system.
It will increase electricity distribution to 84,850 households in Irrawaddy Region, more than 151,000 households in Bago Region, 42,757 households in Mon State, 27,820 households in Karen State and 36,694 households in Rakhine State, U Tun Naing said.
The six-year project is estimated to cost a total of $308.9 million, of which $10 million will be funded by the state budget.
Deputy Minister for Planning and Finance, U Maung Maung Win, seconded the plan to loan $298.9 million from the ADB.
The loan period is 32 years, including an 8-year grace period and a 24-year repayment period. Interest will be charged at 1 percent during the grace period and 1.5 percent during the repayment period.
U Maung Maung Win said the government had an outstanding foreign loan repayment of about $10.2 billion.
This is within the bearable debt burden and is also in accordance with the 2018 Union Budget Law, the Public Debt Management Law, the 2017 Mid-term Loan Management Strategy and the Development Aid Policy, he added.
Power consumption has been increasing by at least 15 percent annually and it is estimated for consumption to rise to 4,531 megawatts of electricity by 2020-2021, the Minister for Electricity and Energy U Win Khaing, told state media in January this year. He added that the current total electricity production rate is about 3,189 megawatts.
Lawmakers are set to discuss the motion in an upcoming session of parliament.
