Completed Mixed AidData Chinese Aid

ICBC contributes to $40 million buyer’s credit loan for CDMA WLL Local Telephone Project

$20M USD

Funder	Industrial and Commercial Bank of China (ICBC)
Recipient Organization	Algérie Télécom
Country	Algeria
Start Date	Jan 01, 2003
End Date	Nov 16, 2033
Duration	11,277 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`20`

Grant Description

ICBC contributes to $40 million buyer’s credit loan for CDMA WLL Local Telephone Project On August 25, 2003, ZTE’s CDMA WLL contract with Algérie Télécom was approved by the Algerian Ministry of Post and Information Communications Technology. This approval confirmed ZTE’s winning bid on the project contract, tendered on September 22, 2001.

Then, on September 23, 2003, ZTE and Algérie Télécom signed a $40,000,000 commercial contract for the CDMA WLL Local Telephone Project.

The Industrial and Commercial Bank of China (ICBC) and Société Générale reportedly issued a $40 million buyer’s credit loan to Algérie Télécom to support the implementation of this project. Algérie Télécom was to use the proceeds of the loan to finance its commercial contract with ZTE.

The buyer’s credit loan was underwritten by China Export and Credit Insurance Corporation (Sinosure) for a 6.5-year period (which suggests that maturity length of the loan was 6.5-years). The National Bank of Algeria also issued a guarantee in support of this loan.

The purpose of the project was to install two Wireless Local Loops (WLLs) with 240,000 line CDMA WLL digital telephone systems in the city of Algiers. It was completed, but its precise implementation start and end dates are unknown.

ZTE ultimately delivered the project for a cost of $32,000,000, purportedly a fraction of the cost estimated by competing ICT firms.

The completion of these WLLs led to another contract signing on January 1, 2005, in which ZTE agreed to build a CDMA network focused primarily in the provinces of Tizi Ouzou, Bouira, and Bejaia, although it also sought to reach 43 localities in total. Upon completion, this new infrastructure was expected to bring total network coverage in Algeria to 95%.

📋 Staff Comments

The Chinese project title is CDMA WLL农话网项目 or 中兴通讯阿尔及利亚电信项目. The loan that supported this project is not included in the database of Chinese loan commitments that SAIS-CARI published in July 2020.
CDMA WLL is an Information Communications Technology (ICT) term referring to a Code Division Multiple Access - Wireless Local Loop, the technological systems used to transmit wireless calls and create network connectivity. The commitment field is not populated because the individual contributions of ICBC and Société Générale to the buyer’s credit loan are unknown.
For the time being, AidData has estimated the contribution of the Chinese state-owned bank by assuming that the two lenders contributed equal amounts ($20,000,000) to the loan syndicate.

📚 Sources & References

China: Sinosure
ZTE Corp. of China, the official version
Shenzhen Zhongxing Company won another large telecom engineering construction project in Algeria
ZTE's Algerian CDMA project contract came into effect
ICBC's innovative financial services support companies to “go global”, http://www.cellular.co.za/news_2005/jan/010704-zte_wins_algerian_cdma_network_c.htm, http://www.newsflash.org/2004/02/hl/hl107055.htm, http://hi.baidu.com/gyyjj/blog/item/6f8122db97dde967d0164e08.html
工行创新金融服务支持企业“走出去”
工行巴西出口买贷项目获《国际贸易评论》“2005年度最佳交易奖”
ICBC Brazil Export Buyer Credit Won the'2005 Best Trade' from Global Trade Review
Huawei Wins US$30m CDMA WLL Deal from Algeria Telecom
Qualisteam - Nouvelles du 12/01/04 : Cetelem / Societe Generale / Credit Agricole / Aviva
Qualisteam - Nouvelles du 14/01/04 : Credit du Nord / KBC Bank / Fortis & ICBC / Entenial / Credit Agricole S.A.
ZTE Annual Report 2006
中兴通讯股份有限公司 ZTE CORPORATION 二○○六年年度报告全文 Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.