$11 billion CEDRE financing
to be cut to $6.4 billion
Reprioritization of projects and
cutting of execution period
The Cabinet said it has slashed to around $8.5 billion the value of investment earmarked for projects under the $23 billion Capital Investment Program (CIP) presented by the former government at the CEDRE conference in 2018. As a result the $11 billion in financing requested at the conference has dropped to $6.4 billion.
This leaves a $2.1 billion government contribution to these projects to be financed from the budget. The government has not indicated how it will raise these funds.
The present government had forecast minimum disbursements of CEDRE funds worth $2.2 billion for the period extending until 2024 in the Financial Recovery Plan it had presented to the IMF.
The cut in the budget allocated for the CIP, which mainly consists of infrastructure projects, resulted from reprioritization of the projects whose numbers have been reduced to 137 from 285 projects.
The implementation period was also shortened to ten years from 12 years.
“The CIP is a core part of the government’s reform plan, which accounts for a minimum of $6.4 billion of CEDRE committed financing to be disbursed over a period of ten years starting in 2021,” the government said in a presentation at the first local CEDRE coordination meeting held last week.
The financing pledged at the CEDRE donor conference held in Paris in 2018 totaled $11 billion and consisted of concessionary loans and some grants. They were conditioned on the implementation of reforms.
The government said during the coordination meeting that it gives priority to a structural reform of the electricity sector and plans to set up a national agency for combating corruption and illicit enrichment.
Ambassador Pierre Duquesne, the designated French envoy to follow up on implementing CEDRE provisions, said that the government is required to set a time schedule for reforming the electricity sector. He also said that the government must abide by transparency principles and should immediately start combating corruption and illicit enrichment.
Reported by Shikrallah Nakhoul
Date Posted: May 27, 2020