Completed Mixed AidData Chinese Aid

China Eximbank provides $35 million preferential buyer's credit for Regar Substation Reconstruction Project (Linked to Record ID#40481, #40479, #72802, #69997)

$35.04M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Tajikistan Ministry of Finance
Country	Tajikistan
Start Date	May 20, 2013
End Date	Mar 18, 2032
Duration	6,877 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`40482`

Grant Description

China Eximbank provides $35 million preferential buyer's credit for Regar Substation Reconstruction Project On May 20, 2013, the Export-Import Bank of China (China Eximbank) signed a $35,043,318.80 preferential buyer's credit (PBC) agreement with the Ministry of Finance of the Republic of Tajikistan for the Regar Substation Reconstruction Project.

The PBC (loan) agreement was ratified by the Tajik parliament in June 2013.

📋 Loan / Grant Terms

💰 Loan Amountcarried the following borrowing terms: a maturity of 20 years

The borrower was expected to use the proceeds of the loan to finance 95% of the cost of a $36.9 million commercial contract [ID# TBEA/RT2012-002] between Open Joint Stock Holding Company (OHSHC) “Barqi Tojik” -- a state-owned enterprise in Tajikistan responsible for the generation, transmission, and distribution of electricity and thermal energy -- and TBEA Co., Ltd., which was signed on September 25, 2012.

The Government of Tajikistan was responsible for covering the remaining 5% ($1.8 million) of the commercial contract cost.

The Government of Tajikistan used the proceeds of the PBC to on-lend — through subsidiary loan agreement Subsidiary Agreement No.

TAJ-2013(22) TOTAL No.(266) BT-025, dated July 31, 2011 — to Open Joint Stock Holding Company (OHSHC) “Barqi Tojik” at a 6% interest rate between July 31, 2013 and November 21, 2033.

The loan's amount outstanding was TJS 276,008,000 as of December 31, 2016, TJS 309,047,000 as of December 31, 2017, TJS 330,444,000 as of December 31, 2018, TJS 339,472,000 as of December 31, 2019, and TJS 395,990,000 as of December 31, 2020.

The project involved the reconstruction of Regar substation, which is located near the city of Tursunzoda about 50km west of Dushanbe. TBEA Co., Ltd. was the contractor responsible for project implementation. Construction began on November 22, 2012. The substation was put into operation on June 1, 2016.

There are some indications that the China Eximbank loan for the Regar Substation Reconstruction Project may have underperformed vis-a-vis the original expectations of the lender.

According to a 2021 IMF report, ‘[OHSHC “Barqi Tojik”] has significant arrears to the government on [foreign exchange] denominated loans.

The government on-lends concessional [foreign exchange] loans […] from multilateral and bilateral agencies to [OHSHC “Barqi Tojik”] on non-concessional terms. These loans are denominated in [foreign exchange] and are intended to develop the energy infrastructure.

However, these debts are not serviced fully, resulting in [foreign exchange] arrears to the government.’ A 2021 report by the International Energy Agency (IEA) elaborated on this point, explaining that ‘[a] high rate of uncollected payments for electricity use due to illegal connections, power theft and outdated metering infrastructure contribute to the worsening financial health of Barki Tojik.’ Then, in March 2023, the IMF published a report, which noted that ‘[I]n 2021 the SOE sector […] kept accumulating debt service losses, where within a year the amount of debt overdue payments […] increased from TJS 14 billion to TJS 17 billion (17.1 percent of GDP).

Some 93 percent of accumulated overdue debt belongs to [OHSHC “Barqi Tojik”].’

📋 Staff Comments

The Regar substation supplies electricity to the China Eximbank-financed Talco aluminium plant (as captured via Record ID#53755).
The Russian project title is Реконструкция подстанции Регар -500 кВт.
The PBC (loan) agreement can be accessed in its entirety (in English and Russian) via https://www.dropbox.com/scl/fi/jqqghgucxeyel6hxpor6u/Tajikistan-2013-China-Eximbank-PBC-for-Regar-Substation-Reconstruction-Project-English.pdf?rlkey=5k1rmoyma406xxu34jdt7i46b&dl=0 and https://www.dropbox.com/scl/fi/s5bm488l4aic8nc1ujn1g/Tajikistan-2013-China-Eximbank-PBC-for-Regar-Substation-Reconstruction-Project-Russian.pdf?rlkey=k5x7ji0fp0crgc8jdfirlw2xs&dl=04. The PBC agreement for the Regar Substation Reconstruction Project was one of many agreement signed during the same visit of the President of Tajikistan to China from May 19, 2013 to May 20, 2013. The other agreements were for: an RMB 33 million loan to Amonatbonk (captured via Record ID#69997), an RMB 200 million grant (captured via Record ID#40481), a loan to Zijin Mining for investment into the Zeravshan Gold Mine (captured via Record ID#40479), loans worth $20 million to Amonatbonk (captured via Record ID#72802), a technical cooperation agreement, a fruit inspection protocol, and a sports cooperation agreement.

📚 Sources & References

China will lend Tajikistan grant of $ 32.2 million.
Consolidated financial statements for the year ended December 31, 201 8
Consolidated financial statements for the year ended December 31, 2018 and independent auditors’ report
Cross-Border Electricity Trading for Tajikistan: A Roadmap
Foreign Aid Report 2015
Initial Environmental Examination
List of Chinese Government-Financed Projects in Tajikistan from the Ministry of Finance via the IMF May 2018
May 2018 Flat Export from Tajikistan AIMS China Specific Projects
Meetings with president of Eximbank of China and governor of Henan province
OPEN JOINT STOCK HOLDING COMPANY “BARQI TOJIK” Consolidated financial statements for the year ended December 31, 2017 and independent auditors’ report
Program Appraisal Document on a Proposed Grant in the Amount of SDR97.2 Million (US$134 million equivalent) to the Republic of Tajikistan for a Power Utility Financial Recovery Program for Results
PROJECT APPRAISAL DOCUMENT ON PROPOSED CREDITS IN THE AMOUNT OF US$169.135 MILLION AND A PROPOSED GRANT IN THE AMOUNT OF US$56.565 MILLION EQUIVALENT TO THE REPUBLIC OF TAJIKISTAN FOR A NUREK HYDROPOWER REHABILITATION PROJECT - PHASE I
REPUBLIC OF TAJIKISTAN SELECTED ISSUES
Republic of Tajikistan: 2022 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Tajikistan
Tajik parliament ratifies two loan agreements signed with China Exim Bank
Tajik parliament ratifies two loan agreements signed with China Exim Bank
Tajikistan 2013 China Eximbank PBC for Regar Substation Reconstruction Project English
Tajikistan 2013 China Eximbank PBC for Regar Substation Reconstruction Project Russian
TAJIKISTAN’S ENERGY PROFILE - POTENTIAL & PERSPECTIVES, Аудит отчетности ОАХК 'Барки Точик' по МСФО за 2020 год, Восстановление подстанции Регар-500 кВ начнётся в середине августа Подробнее, Китайская компания 'ТВЭА' начала строительства ЛЭП 500 кВ Оби Гарм- Регар в Таджикистане, Китайская компания 'ТВЭА' начали строительства ЛЭП 500 кВ Оби Гарм- Регар в Таджикистане, Китайская ТВЕА научила таджикских специалистов управлять подстанцией “Регар-500 кВ”, Компания TBEA подготовила специалистов для управления модернизированной подстанцией «Регар-500», Компания TBEA подготовила специалистов для управления модернизированной подстанцией «Регар-500», ЛЭП 500 кВ «Душанбе-Оби Гарм» обеспечивает надежную передачу электроэнергии в единую энергосеть Таджикистана, ОТКРЫТАЯ АКЦИОНЕРНАЯ ХОЛДИНГОВАЯ КОМПАНИЯ «БАРКИ ТОЧИК» Консолидированная финансовая отчетность за год, закончившийся 31 декабря 2019 г. и отчет независимых аудиторов, Постановление Правительства Республики Таджикистан от 28 апреля 2017 года, № 219 'Об акте Государственной приёмочной комиссии завершенного строительством объекта Проекта 'Реабилитация подстанции Регар - 500 кВ', Пресс-релизы : Официальные переговоры на высшем уровне между Республикой Таджикистан и Китайской Народной Республикой, Реконструкция подстанции “Регар-500 кВ” завершится до конца текущего года 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

Tajikistan Ministry of Finance

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