Reuters reports that the European Investment Bank is holding off on decisions to finance the $760 million Ruzizi III hydropower plant in Central Africa, due to fighting between Rwandan-backed rebels and the Democratic Republic of Congo.
The planned 206-megawatt Ruzizi III was being appraised ahead of financial closure expected later this year, project officials said, when Rwanda-backed M23 rebels launched their offensive.
"With the M23 gaining territory in South Kivu, the Ruzizi III project site is within the conflict area," a spokesperson for the EIB, the lead arranger, said in response to questions.
"We are taking a 'wait and see' approach as to how to proceed with the project ... We are also closely co-ordinating with our co-financiers".
Germany's state-owned development bank KfW, the French Development Agency (AFD), the African Development Bank and the World Bank are among the investors.
A KfW spokesperson said the bank adhered to Germany's policies and referred to a March 4 federal ministry statement saying new financial commitments were suspended amid a review of cooperation with the Rwandan government.
The World Bank said it was "actively engaging" all three countries, as well as regional body Energie des Grands Lacs to try to move towards financial closure with alacrity.
The proposed plant, in planning for more than a decade, would be the first public-private partnership project to generate renewable energy from shared resources in Africa. It would supply electricity to some 30 million people once completed. There are already two smaller hydropower dams on the river. A fourth phase is also being contemplated.
Aiming to operate by 2030, Ruzizi III would double Burundi's generation capacity and increase Rwanda's by a third, officials estimated previously.