Rwanda Energy Supplemental DPO

closed

Closed

This document proposes a supplemental development financing of EUR 91.4 million (US100 million dollars equivalent) to the Third Rwanda Energy Sector Development Policy Financing (DPO-3; P169040), approved by the IDA Board on August 29, 2019, to support the Government of Rwanda’s (GoR) response to the COVID-19 pandemic. DPO-3 was the third and final operation under a three-year program (3 multiply US125 million dollars) with the objective of enabling a fiscally sustainable expansion of electricity services in Rwanda. The proposed supplemental financing will enable the GoR to prepare a timely fiscal response to the economic shock from the COVID-19 pandemic, to put in place platforms for policy development and coordination of prevention and preparedness, and to safeguard the reform agenda supported by the DPO series. The economic, social, and poverty impact of the COVID-19 pandemic in Rwanda could be far-reaching and will require immediate and targeted action from the Government to minimize its extent and intensity. The coronavirus pandemic poses serious economic, social, and public health threats to Rwanda. Even though the COVID shock is expected to be transitory, the overall adverse economic impact on Rwanda will be substantial. The growth rate for 2020 is expected to decelerate to about 5 percent, with significant downside risks depending on the extent of COVID19’s spread in Rwanda and any delays in recovery of international flows of goods, services and people. Growth could be substantially lower and social and poverty impact substantially worse if there were going to be widespread cases in Rwanda, which would overwhelm the health sector and exact even more toll on economic activities. Containment of COVID-19, including immediate investments in health systems, and mitigation of social impact of the public health crisis, will require substantial fiscal resources.

World Bank Group

Project

Solar, Power Generation (CCGT), Government