Active Mixed AidData Chinese Aid

China Eximbank provides $253.3 million preferential buyer’s credit for 262 km Merke-Burylbaital Highway Reconstruction Project (Linked to Record ID#54991, #55016, and #54990)

$253.3M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	JSC NC KazAvtoZhol
Country	Kazakhstan
Start Date	May 15, 2017
End Date	Aug 13, 2033
Duration	5,934 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`54989`

Grant Description

China Eximbank provides $253.3 million preferential buyer’s credit for 262 km Merke-Burylbaital Highway Reconstruction Project On May 15, 2017, the Export-Import Bank of China and JSC KazAutoZhol National Company Joint Stock Company (JSC NC KazAutoZhol or азАвтоЖол)— a Kazakh state-owned transportation company — signed a $253.3 million preferential buyer’s credit (PBC) agreement for the 262 km Merke-Burylbaital Highway Reconstruction Project.

📋 Loan / Grant Terms

📅 Maturity20 years

⏳ Grace Period5 years

💹 Interest Rate2%

The Government of Kazakhstan provided a sovereign guarantee for the loan.

The proceeds of the PBC were to be used by the borrower to finance approximately 85% of the cost of a $297 million commercial (EPC) contract between China Xinxing Construction and Development Co. Ltd (Xinxing Construction) and KazAutoZhol.

The purpose of the project was to reconstruct the Merke-Burylbaytal highway (MB266) in 4 sections measuring 262 km in length, The first (86 km), four-lane section runs from Merke to Shu. The 3 remaining, two-lane sections (measuring 176 km in length) run from the town of Shu to the village of Burybaytal.

The highway passes through the settlements of Tatti, Shu, and Birlik.

The project includes the construction of six bridges, three overpasses over rail lines, 11 illuminated traffic intersections, 276 culverts, recreation areas, and auto pavilions. Xinxing Construction is the general EPC contractor responsible for implementation. However, China General Technology Group (Genertec) is also involved in implementation.

A groundbreaking ceremony was held on March 26, 2019. The project was originally expected to reach completion in June 2022. However, it has encountered various implementation problems, including the COVID-19 pandemic.

According to the Official Information Source of the Prime Minister of Kazakhstan, the project was then scheduled for completion in 2024.

📋 Staff Comments

This project is also known as the Merke-Shu-Burylbaytal highway project. The Chinese project title is 梅尔克-布鲁拜塔尔公路改造 or 哈萨克斯坦MB266国家级公路改造项目 or “梅尔克—布鲁拜塔尔”公路改造项目 or 梅尔克-布鲁拜塔尔公路改造项目 or 梅尔克-布雷拜塔尔公路项目（266公里) . The Russian project title is Реконструкция автомобильной дороги республиканско-го значения «Мерке –Бурылбайтал» км 7-273.
In its 2018 financial statements, JSC NC KazAutoZhol disclosed that it signed 4 preferential buyer’s credit (PBC) agreements with China Eximbank in 2017 worth $1,667,577,000 to support 4 road reconstruction projects: a $434.5 million PBC for the Kalbatau–Maikapshagai Road Reconstruction Project (captured via Record ID#54990), a $796 million PBC for the Taldy-Korgan-Kalbatau-Ust-Kamenogorsk Road Reconstruction Project (captured via Record ID#55016), a $253.3 million PBC for the Merke-Burylbaital Highway Reconstruction Project (captured via Record ID#54989), and a $183.95 million PBC for the Astana Bypass Road Reconstruction Project (captured via Record ID#54991) (see that the loans were PBCs at '哈萨克斯坦总理马明视察中国企业承建公路项目': see rest at pg.14 of 'Financial Statements for the year ended 31 December 2018'). The combined monetary value of these 4 PBC is $1,667,750,000, which is very close to $1,667,577,000 figure reported in the 2018 financial statements of JSC NC KazAutoZhol.
This project and Kalbatau-Maykapshagai Road Project's combined cost was $808 million USD. Kalbatau-Maykapshagai Road Project's individual cost of $511 million USD was known. Therefore, to calculate the cost of this project, AidData subtracted $511 million USD from $808 million USD and got $297 million USD).
This China Eximbank loan is not included in the China’s Overseas Development Finance Dataset that Boston University's Global Development Policy Center published in December 2020.
The borrowing terms of the loan are specified in this official source (https://www.dropbox.com/s/5bx9wt7r2tq10ag/%D0%93%D0%BE%D0%B4%D0%BE%D0%B2%D0%BE%D0%B9%20%D0%BE%D1%82%D1%87%D0%B5%D1%82%20%D0%B7%D0%B0%202020%D0%B3.pdf?dl=0).

📚 Sources & References

Компания «КазАвтоЖол» подписала двустороннее соглашение в рамках Форума 'Один пояс, один путь'.
Full text: List of deliverables of Belt and Road forum
Nurly Zhol State Program: highways, logistics, housing and communal services, проекта реконструкции а/д «Мерке - Бурылбайтал» (км 7-273)
RECONSTRUCTION OF THE ROAD 'MERKE-BURYLBAYTAL' (7-273 KM) STARTED
新兴建设承建的哈萨克斯坦MB266国家级公路改造项目举行开工典礼
China expands engagement in Kazakhstan Both states want to benefit from the new Silk Road
BRI in Central Asia: Rail and Road Connectivity Projects
Financial Statements for the year ended 31 December 2018, 'ҚазАвтоЖол' ұлттық компаниясы' акционерлік қоғамының 2013 - 2022 жылдарға арналған даму стратегиясын бекіту туралы
新兴集团承接的哈萨克斯坦两段公路改造项目贷款协议签约, Постановление Правительства Республики Казахстан от 14 апреля 2017 года № 201, ЖАМБЫЛ ОБЛЫСЫНДА МЕРКІ-ШУ-БУРЫЛБАЙТАЛ АВТОЖОЛЫН ҚАЙТА ЖАҢАРТУ ЖҰМЫСТАРЫ ЖҮРГІЗІЛМЕК
哈萨克斯坦总理马明视察中国企业承建公路项目, О внесении изменения в постановление Правительства Республики Казахстан от 26 декабря 2013 года № 1409 'Об утверждении Стратегии развития акционерного общества 'Национальная компания 'ҚазАвтоЖол' на 2013 – 2022 годы', Об утверждении перечня инвестиционных проектов, предлагаемых к финансированию за счет средств негосударственных займов под государственные гарантии, на 2017 год
Road construction under the 'Bright Road' plan in Kazakhstan
新兴集团承接的哈萨克斯坦两段公路改造项目贷款协议签约
通讯：全力以“复”——中企承建哈萨克斯坦首都环城公路复工记
中企承建哈公路建设改造项目稳步推进
中企承建哈公路建设改造项目稳步推进, ГОДОВОЙ ОТЧЕТ АО «НК «ҚазАвтоЖол» за 20 20 год
Financial Statements for the year ended 31 December 2018
Financial Statements for the year ended 31 December 2019 (Финансовая отчетность за год, закончившийся 31 декабря 2019 года)
Financial Statements for the year ended 31 December 2020 (Финансовая отчетность за год, закончившийся 31 декабря 2020 года)
Financial Statements for the year ended 31 December 2021 (Финансовая отчетность за год, закончившийся 31 декабря 2021 года)
Financial Statements for the year ended 31 December 2022 (Финансовая отчетность за год, закончившийся 31 декабря 2022 года)
Consolidated Financial Statements for the Year Ended 31 December 2023 with Independent Auditor's Report (Консолидированная финансовая отчетность за год, закончившийся 31 декабря 2023 года с Аудиторским заключением независимого аудитора)
Renovation and reconstruction of 12 thousand kilometres of roads planned for 2024 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.