By JAMES KUNDA –
MORE than US$400 million from the US$1.25 billion Eurobond has been allocated for the improvement of road infrastructure countrywide, Parliament has heard.

. Mvunga

Finance Deputy Minister Christopher Mvunga said the money would be channelled towards improving urban and rural roads.
Mr Mvunga was responding to UPND Milambo Member of Parliament (MP) Austin Milambo, who wanted to know which projects would be financed using the bond which was issued this year.
“The major allocations include $410.7 million for the improvement of road  infrastructure, including rural roads,” Mr Mvunga said.
He said $268 million had been set aside for domestic debt swap and clearance while $40 million would be spent on the maintenance of canals and procurement of maritime equipment.
Mr Mvunga said $45.2 million and $20.3 million had been allocated towards infrastructure development in the education and health sectors, respectively.
“A total of $20 million has been allocated for water and sanitation projects. Other allocations include; $45.2 million for citizens and youth empowerment and $21 million and $15 million for the agriculture sector and on-lending to state-owned enterprises, respectively,” he said.
Mr Mvunga said the balance of the fund had been earmarked as part of financing for the 2016 National Budget.
On repayment, Mr Mvunga stated that the bond was structured to be redeemed in three equal instalments of US$416.7 million in July 2025, the same amount in July 2026 and July 2027.
“To ensure that Government does not default, a sinking fund shall be established in line with the requirements of the loans and guarantees authorisation Act Cap 66 to accumulate money to be used for the repayment of bonds at maturity,” he said.
Similar sinking funds have already been established through the issuance of Statutory Instrument (SI) 75 of 2015, to facilitate the repayment of the $750 million and $1 billion bonds which were issued in 2013 and 2014 respectively.