The Road Fund Administration (RFA) says it has secured N$350 million from Nedbank Namibia to finance its Low Volume Road Seal Strategy (LVRSS).
The RFA strategy intends to upgrade highly trafficked gravel roads to a low volume bitumen seal road, with a less than 15-year design life.
“Due to budgetary constraints, it has become a serious challenge to adequately maintain the gravel road network. Consequently, the road network is in poor condition and continuously deteriorating. Indications are that if we do not act promptly, the situation will deteriorate to a point where 75% of the gravel road network is projected to be in a poor-to-very poor condition by 2025,” said RFA CEO, Ali Ipinge.
Namibia has a road network of approximately 49 000 km, valued at N$101 billion, of which about 90% is unpaved. Since inception, the RFA has invested more than N$20 billion in road infrastructure. Namibia ranked number one in Africa and 21 in the world in terms of quality of road infrastructure.
“We initiated the relationship with RFA in 2016 and Nedbank Namibia has become a key partner in their business, and the debt funding is the first step towards furthering the partnership with the RFA. We believe that there is room to further advance this relationship and partnership with the RFA,” said Nedbank Namibia Managing Director, Martha Murorua.
“Nedbank Namibia is committed to the financing of projects that bring economic development to the country, and roads are an important catalyst for the economic development of Namibia. We are confident that this loan will add value to the transport and logistics sector in the country.”
According to Nedbank, the current estimates indicate that Namibia should upgrade 315 km to LVSR every year at a cost of N$ 923 million per annum, in order to arrest the rapid deterioration and reclaim the gravel road network to acceptable condition.
“The funding agreement with the RFA illustrates our commitment to playing our part in seeing the Namibian economy grow. Good roads play a crucial role in overall economic development. At Nedbank Namibia, we have no doubt that the -loan will add value to the transport sector in the country and further stimulate economic activities in other secondary and tertiary sectors,” Murorua said, adding despite the tough economic environment, Nedbank Namibia has committed to supporting the economy through credit extensions to account holders and by engaging clients on debt restructuring.
