Germany to fund Kenya's water supply, health sectors

Kenya and Germany on Thursday signed five financing agreements consisting of loans and grants for a total of 38.3 million euros (about 43 million U.S. dollars ) to boost Kenya's water supply, sanitation and health sectors.

Cabinet Secretary in charge of the National Treasury Henry Rotich told a media briefing in Nairobi that a loan agreement of 20 million euros will be used to finance a program of basic health insurance for the poor and informally employed.

"The loan proceeds will be utilized in financing the modernization and expansion of health data management systems," Rotich said during the signing of the Kenya-Germany Financial and Technical Cooperation agreements.

Rotich said the funds will also co-finance the health insurance premiums and health care treatment costs for targeted groups.

According to Rotich, another 5.5 million euros in loans will be for the financing of the Phase Four Smallholder Irrigation Program in Mount Kenya Region.

The agreement also included a 8.5 million euro loan for the financing of the Development of the Water and Sanitation Sector- Water Trust Services Trust Fund Phase Three.

"The objective is to provide affordable and accessible water supply and sanitation for the urban poor living in low income areas," Rotich said, adding that so far more than 1.4 million people have already achieved access to safe water from the ongoing development partner's support.

Kenya also received a grant amounting to four million Euros to co-finance Equity Group Foundation's Wings to Fly Scholarship Program, which aims at assisting the needy members of society to access higher education.

Germany also extended a 300,000 euro grant to finance a feasibility study for a coherent development program for food security and drought resilience for Kenya's semi arid counties of Turkana and Marsabit.

According to the National Treasury, the loans will have a grace period of 10 years, with a repayment period of 40 years and an annual interest rate of 0.75 percent.

Rotich said that German's cumulative support to date currently stands at 1.6 billion euros.

German Ambassador to Kenya Andreas Peschke said Germany has committed to make available to Kenya funds amounting to 138 million euros for the period 2014-2016.

"It will include 106.5 million euros in financial assistance and 31.5 million euros in technical assistance," Peschke said, adding this means German assistance to Kenya has nearly doubled when compared to 10 years ago.

The envoy said Kenya-Germany Development Cooperation will also focus on education, energy and the fight against corruption. (one U.S. dollar equals 0.89 euro) Endi