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NAWEC faces challenge to access sufficient financial resources

Feb 14, 2014, 10:09 AM | Article By: Njie Baldeh

The challenge of the National Water and Electricity Company (NAWEC) over the past couple of years has, generally, been to access sufficient financial resources to be able to procure fuel and pay for energy supplied by the Global Electrical Group under a power purchase agreement, Baboucarr Sanyang, NAWEC’s Managing Director told members of the PAC/PEC committee of the National Assembly on Wednesday.

Presenting his institutions annual report and financial statement for the year 2012, Sanyang said with soaring oil prices in 2010 in the international market, at a time of global economic and financial crisis, coupled with the need to repair and overhaul some of the engines at the Kotu Power Station to ensure availability of generation, NAWEC had to borrow significantly from local banks to be able to meet its obligations to suppliers.

He noted that the year 2012 was characterized by a steady and constant rise in the price of petroleum products, the main cost driver of the company, which affected the financial capacity of the company.

This, he added, has had a significant impact on the liquidity situation of the company.

Sanyang further told members of the PAC/PEC committee that NAWEC currently is owed over D200 million (two hundred million dalasis) by government institutions, payment of which debt is still pending.

According to him, the year 2012 was characterized by implementation of major water projects to boost the supply of clean water, for both the urban and peri-urban population.

In the area of electricity, Sanyang explained that the major activities in 2012 going into 2013 has been procurement for consultancies and works of major generation projects, both for the urban and rural Gambia up to about 35MW brand new additions to the existing capacity.

He noted that like in many developing countries, the global environment affects the operations of NAWEC.

‘‘In a period when the global economic recovery is threatened by multiple problems including supply shocks (soaring oil prices), financial shocks (Euro zone and US debt crises and downgrade of US credit rating), high unemployment, famine and hunger in the Horn of Africa, social unrest and civil war in the Middle East and North Africa, and food crises,’’ he stated.

He told members of the committee that realizing the importance of water and energy in socio-economic development, NAWEC and the government have made significant efforts in 2012 to ensure the provision of secured and reliable supplies of water and electricity to the population, and to the different sectors of the economy.

He said in order to achieve this goal and to overcome the problems of the past, NAWEC with support from the Gambia government adopted a strategy which focuses on a reliable, affordable and continuous expansion of water supply and power system.

After applauding NAWEC for its achievements despite all the challenges over the years, members of the PAC/PEC committee adopted the report.