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Mon 25 Aug 2008 12:20 AM

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Kuwait signs loan for controversial Sudan dam

Merowe project gets $53mn from Kuwait Fund for Arab Economic Development.

The Kuwait Fund for Arab Economic Development has signed a loan agreement with Sudan to help finance the construction of the controversial Merowe Dam, Kuwait's official news agency said on Sunday.

The fund will provide Sudan with 15 million Kuwaiti dinars ($52.5 million) for the finance of the project which will meet the growing electricity demand and reduce the cost of power production, it said.

The agreement was signed by Awadh Ahmad, Sudanese minister of national economy and Abelwahab Al-Badr, the fund's director general .

The Merowe Dam is located on the River Nile, close to the Fourth Cataract, 350km north of the capital Khartoum.

The total cost of the project is around $1.8 billion and it has received pledges of funding from China, Saudi Arabia and Abu Dhabi.

It has also, however, been strongly criticized by a UN report for both the lack of a proper environmental assessment and the displacement of the local Nubian population.

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