By Allan Olingo

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The CEO of the French Development Agency Rémy Rioux spoke to Allan Olingo about the $2 billion invested in East Africa and the status of each undertaking.

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Your agency, the AFD, has long supported the region’s energy projects. Have these investments borne fruit?

The energy sector has been key to our interventions in East Africa. We have funded production, transmission, distribution and interconnection between nations, with the emphasis on renewable energy.

In Kenya, the geothermal plants Olkaria II and IV, to which AFD contributed, have produced more than 10 per cent of the country’s total electricity in the past two years.

We also facilitated over 78,000 connections to the power grid through the revolving fund Stima Loan managed by Kenya Power.

We also have ongoing works on the interconnection between Kenya and Ethiopia. The line to be commissioned in 2019 will be the main interconnection in East Africa.

In Uganda, we signed a $43.3 million loan to finance the improve power reliability.

We also support the 400kV transmission line upgrade between Masaka and Mbarara, which once complete will increase power reliability in the central and western regions.

In Tanzania we put in $78.2 million for upgrading power substations, extending the national grid and distribution ($116.74 million for rural electrification).

We will also support the $100 million power interconnection between Tanzania and Zambia as part of the connection between the Southern African Power Pool and East African Power Pool.

Through these investments, we hope to see improvement in the generation, transmission, distribution and accessibility of electricity.

The region has been keen to modernise its railway and aviation infrastructure. Is AFD supporting these areas?

We are active in transport all over the EAC, mainly on airports, ports and roads. In Kenya, we participated in the rehabilitation of Terminal 1A of JKIA.

We are now funding the rehabilitation at the Moi International Airport, Mombasa runway and the airfield ground lighting system. The works should start next month.

We have also loaned $116.7 million to the Kenya Ports Authority to refurbish berths 11 to 14 at Mombasa port.

In Uganda, together with other partners, we are appraising the Kampala-Jinja Expressway toll road project.

So we are not just limited to the energy and water sectors but have also identified key infrastructural projects across the region to which we offer financing.

Has your funding of water projects around Lake Victoria impacted livelihoods in the region?

We have worked around Lake Victoria to improve the water quality. In Kenya, our focus has been on urban water — with more than $600 million invested in the sector in 20 years, and $408.6 million in ongoing projects.

In Kisumu, water and sanitation infrastructure, the transmission mains and storage capacity has been improved. The results are positive as 63 per cent of residents now have uninterrupted water supply.

In Uganda, more than 500,000 new beneficiaries have accessed clean water. We are financing research on water quality and sources of pollution for Lake Victoria on Murchison Bay in Uganda together with Makerere University.

In Tanzania, the water projects funded to the of $134.25 million started recently, but are expected to impact on human health in Mwanza, Bukoba, Musoma.

What’s the mix of your financing?

We provide loans and involve the private sector. It means that we create new business ventures, which create jobs and thus enhance the government’s tax receipts.

This is complementary to what other partners are doing, especially the EU which provides to the region with grants from the European Development Fund, of which around 19 per cent comes from France.

We provide Kenya only very soft loans that are much cheaper, and for projects that have a clear, expected impact on development.

However, we also provide grants, but mostly for technical assistance, studies, innovative projects, governance or cultural industries like we have done with Heva Fund.

Where does SME financing sit in AFD’s priorities?

It is one of our priorities in East Africa, where the private sector is vibrant and the first source of job creation.

With the support of the EU, we have assisted more than 27 SMEs in Kenya, Uganda and soon in Tanzania to implement green energy solutions.

What role will AFD play in the $76 million African tech start-up fund announced by President Emanuel Macron?

Following the presidential announcement, we are unveiling its new mechanism to support African start-ups. We already have the Digital Africa competition, with this year’s edition dedicated to promoting gender equality.

The competition will be open to start-ups run by women and those that offer innovative solutions for gender equality.

We are also launching the Digital Africa label and a digital networking platform to support African entrepreneur and promote innovation through digital technologies.

Health care has received millions in donor support in the region. Has AFD been part of this?

We mainly intervene with direct financing to private institutions that have a clear social dimension.

We have provided funds in Kenya, Uganda and Tanzania for key health projects to bring better, closer and more affordable health care to citizens.