China Eximbank provides $86 million buyer’s credit loan for 168 km El Fashir-Um Kaddada Road Construction Project (Linked to Record ID#57039, #54079)

China Eximbank provides $86 million buyer’s credit loan for 168 km El Fashir-Um Kaddada Road Construction Project On July 19, 2008, China Eximbank and the Government of Sudan signed a $3 billion oil-backed master framework agreement (or line of credit) to finance various infrastructure projects (as captured via Record ID#57039).

This resources-credit cooperation package is backed by future revenues from the sale of oil exports.

One of the subsidiary loans approved through this agreement in 2009 was a $86 million BCL for the 168 km El Fashir-Um Kaddada Road Construction Project.

The proceeds from this BCL were used to partially finance a $96 million commercial contract signed in 2009 with China Poly Group Corporation and China Railway 18th Bureau.

This project involved the construction of a 168km road in Northern Darfur that begins in the city of El Fashir (الفاشر, the capital of Northern Darfur State) and extends eastward to Um Kaddada (أم كدّد;أمّ كدّادة) in Northern Darfur State.

The groundbreaking ceremony took place on January 14, 2010, and the project was officially completed on January 5, 2015.

There are some indications that the China Eximbank loan issued for the El Fashir-Um Kaddada Road Construction Project may have underperformed vis-a-vis lender expectations.

According to Sudan’s Finance Minister Ali Mahmood Abdel-Rasool, China Eximbank suspended its financing for 11 projects in Sudan following the secession of South Sudan in July 2011, which triggered a major loss of oil revenue (a key source of collateral for China Eximbank loans).

Ali Mahmood Abdel-Rasool said at the time that the Government of Sudan had previously pledged oil revenues (worth 120,000 barrels per day) to China Eximbank as a source of collateral.

Then, on February 18, 2012, the Chinese Government announced that it had agreed to reschedule the outstanding debt obligations of the Government of Sudan by extending loan repayment periods by 5-years (as captured via Record ID#30421).

According to the External Debt Unit of the Central Bank of Sudan, the Government of Sudan's total arrears to Chinese creditors amounted to $3.864 billion ($2.608 billion in principal, $1.129 billion in interest, and $127 million in penalty interest) as of March 31, 2022.