This article originally appeared in the Global Construction Review.
The World Bank Group has halted millions of dollars worth of funding for the first phase of the Democratic Republic of Congo’s (DRC’s) Grand Inga Dam complex, sub-Saharan Africa’s largest ever infrastructure project.
The bank issued a statement yesterday (26 July) saying it had “suspended disbursements” to the $12bn Inga-3 Basse Chute project following the Congolese government’s decision to take the project in a “different strategic direction to that agreed between the World Bank and the government in 2014”.
In March 2014, the bank’s International Development Association arm approved a $73m grant toward to costs of setting up the project. So far, 6% of that project financing has been disbursed. The money was to have been spent on strategic advice and research, as well as building up the administrative capacity of the government.
“The World Bank’s withdrawal illustrates that Inga 3 violates basic environmental and procurement standards. Any other investors should think twice about getting involved in this white elephant”
– Joshua Klemm, International Rivers
The bank did not say anything more detailed about why it had cut off funds, but noted that it had understood when agreeing the grant in 2014 that the project would be developed as a public-private partnership.
International Rivers, an advocacy group that opposes the Grand Inga project on the grounds that it will benefit international mining companies rather than the population of the DRC, suggested that the bank had withdrawn support because the DRC was rushing development in order to honour a power supply agreement with South Africa.
Joshua Klemm, policy director of International Rivers, commented on the group’s website: “The World Bank’s withdrawal illustrates that Inga 3 violates basic environmental and procurement standards. Any other investors should think twice about getting involved in this white elephant.”
Two consortiums were in the running to build the dam: a Chinese team composed of hydropower specialists Three Gorges and Sinohydro, and a Spanish group is made up of Grupo ACS (Actividades de Construccion y Servicios) and infrastructure specialist Eurofinsa, both based in Madrid. A decision on which to appoint is due to be made next month, with the aim of beginning work on site in June 2017.
This Inga 3 Basse Chute will involve building the DRC’s third dam on the Inga Falls. This is expected to produce 4.8GW of electricity, almost double the country’s present installed generating capacity.
This dam is the first of a series that are expected to be built on the Inga Falls. In its final form, the scheme may consist of some eight power stations built over about 50 years for a total of about $100bn.
The total installed capacity of the falls will be between 40 and 50GW, making it the largest power producer on Earth and, arguably, the most important piece of infrastructure in sub-Saharan Africa.
The World Bank Group statement added that it “was in a continuing dialogue with the government about the implementation arrangements of the project, with the goal of ensuring that it follows international good practice”.