Zimbabwe has secured $193 million in offshore lending to construct hospitals and clinics as part of an agreement with UK infrastructure company NMS. The project, which will see the construction of five 80-bed District Hospitals and thirty 20-bed clinics, is significant for the country’s struggling healthcare facilities.
ABSA and Standard Bank of South Africa are the joint arrangers for the transaction, which will be insured by Export Credit Insurance Corporation of South Africa. The Zimbabwean government had initially funded the construction of clinics at Stoneridge in Harare and Cowdray Park in Bulawayo with $25 million.
Zimbabwe will use $35 million of IMF SDR funds as cash cover, deposited in an offshore SDR escrow account, to secure the foreign banks’ backing. A further $2.5 million from monthly royalty payments will be used to service the debts. UK’s GKB Ventures and Sullivan & Worcester are advising on the project.
NMSI’s other healthcare projects in Africa include a $300 million contract in Zambia, $175 million projects in Ghana, and a €326 million project in Ivory Coast, using prefabricated steel frame structures in its designs to reduce costs.
“This financing package is highly significant for Zimbabwe, and the underlying ‘Built to Care’ rural healthcare project is a key priority for our nation. We are committed to it and to providing the funds for it,” said Andrew Bvumbe, Head of the Aid and Debt Management Office in the Ministry of Finance.
In a joint statement, ECIC, Absa, and Standard Bank said: “This structured financing ushers in an exciting re-emergence of Zimbabwe in international capital markets, and the project, for the delivery of quality healthcare infrastructure for the people of Zimbabwe, represents a fine example of the effective combination of government, industry, and the financial services sector delivering excellent outcomes.”