Completed Mixed AidData Chinese Aid

China Eximbank provides a $295.8 million buyer's credit loan for Phase 1 of Lusaka Urban Road (L400) Upgrade Project (Linked to Record ID#57194, #57190, #57218)

$295.8M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Government of Zambia
Country	Zambia
Start Date	Jul 17, 2013
End Date	Oct 20, 2031
Duration	6,669 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`31329`

Grant Description

China Eximbank provides a $295.8 million buyer's credit loan for Phase 1 of Lusaka Urban Road (L400) Upgrade Project On August 29, 2012, the Zambia Road Development Agency (RDA) signed a $348,293,745 commercial contract with AVIC International Project Company Limited for Phase 1 of the Lusaka Urban Road (L400) Upgrade Project.

Then, on July 17, 2013, China Eximbank and the Government of Zambia signed a $295.8 million buyer’s credit loan (BCL) agreement for Phase 1 of the Lusaka Urban Road (L400) Upgrade Project.

📋 Loan / Grant Terms

💰 Loan Amountare unknown

However, it is known that the borrower purchased buyer's credit insurance from Sinosure.

It is also known that the borrower was expected to use the loan proceeds to finance 85% of the cost of a commercial contract between AVIC International. The Government of Zambia agreed to providing counterpart funding to cover the remaining 15%.

The Lusaka Urban Road (L400) Project involves the design, rehabilitate, upgrade and construct approximately 402 km of selected urban and township roads in Lusaka City. At baseline, 14% of the road network in Lusaka was in good condition, 15% in fair condition. and 71% in poor condition.

L400 was therefore initiated in order to enhance mobility within the city through reduced traffic congestion, travel times, and vehicle maintenance costs.

The scope of works included widening selected roads which have very high traffic volume, improving selected roads to and within the industrial and commercial areas, construction of bus bays along selected bus routes as part of road safety measures, improving of public transport infrastructure, re-engineering selected junctions to improve traffic flow, construction of walkways along selected roads, providing interchange solution for Kafue Roundabout.

Phase I was divided into 4 lots.

The roads in Lot 1 included Burma, Chilimbulu, Mumbwa, roads in Chinika area, roads in the Industrial area and a road leading to Barlastone from Chunga covering a distance of 119 km.

The roads in Lot 2 included roads in areas around Chawama, Lilayi, Kamwala South and Libala South covering a distance of 216.3 km. Lot 3 comprised roads in areas around Chelston, Avondale, Ibex and Kamanga. The total distance of roads in Lot 3 was 77 km. The roads that were included in Lot 4 are unknown.

The Phase 1 groundbreaking ceremony took place on August 16, 2013. Works were supposed to last 43 months. The roads that were successfully rehabilitated, paved through Phase 1 were opened to traffic on December 31, 2017.

📋 Staff Comments

The Chinese project title is 卢萨卡L400道路改扩建 or L400道路改扩建工程 or 赞比亚卢萨卡市城市交通系统升级改造项目 or L400 项目.
In 2016, China Eximbank issued a loan for Phase 2 of the L400 Project (captured via Project ID#57218). Then, in 2018, China Eximbank and ICBC issued loans for Phase 3 (captured via Project ID#57190 and ID#57194).
According to the World Bank's Debtor Reporting System (DRS), the weighted average grace period of all official sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Zambia was 4.4928-years in 2013. AidData estimates the grace period of the China Eximbank loan that supported Phase 1 of the Lusaka Urban Road (L400) Upgrade Project by using this figure. See https://www.dropbox.com/scl/fi/uyz6w7q31x2o8i6rna7ug/DRS-May-2024-Extraction-Official-Chinese-Loan-Commitments-to-Zambia.xlsx?rlkey=n0a6270w91pdmmfyaoqva419r&dl=0 4. According to the World Bank's Debtor Reporting System (DRS), the weighted average maturity of all official sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Zambia was 15.0593-years in 2013. AidData estimates the maturity of the China Eximbank loan that supported Phase 1 of the Lusaka Urban Road (L400) Upgrade Project by using this figure. See https://www.dropbox.com/scl/fi/uyz6w7q31x2o8i6rna7ug/DRS-May-2024-Extraction-Official-Chinese-Loan-Commitments-to-Zambia.xlsx?rlkey=n0a6270w91pdmmfyaoqva419r&dl=0 5. According to the World Bank's Debtor Reporting System (DRS), the weighted average interest rate of all official sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Zambia was 3.9772% in 2013. AidData estimates the interest rate of the China Eximbank loan that supported Phase 1 of the Lusaka Urban Road (L400) Upgrade Project by using this figure. See https://www.dropbox.com/scl/fi/uyz6w7q31x2o8i6rna7ug/DRS-May-2024-Extraction-Official-Chinese-Loan-Commitments-to-Zambia.xlsx?rlkey=n0a6270w91pdmmfyaoqva419r&dl=0

📚 Sources & References

Chinese Ambassador Attended the Ground Breaking Ceremony of the L400 Road Project in Zambia
New Roads Coming
Chinese Ambassador Attended the Ground Breaking Ceremony of the L400 Road Project
A swirling fog of debt
周欲晓大使出席赞比亚首都卢萨卡L400道路改扩建工程动工仪式
National Road Fund Agency Annual Report 2014
AVIC-INTL Project Engineering Company Supports Education in Zambia
华特参建的赞比亚首都卢萨卡L400道路改扩建工程举行盛大的开工仪式
Annual Report 2017, 2013 Annual Economic Report
Report of the Auditor General on the Road Projects Under the Road Development Agency FOR THE Period January, 2012 to December, 2015
National Road Fund Agency Annual Report 2013
Credit management 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.

All Grantees

Government of Zambia

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