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[Cancelled] China Development Bank provided $418 million loan for Copperbelt Urban Roads (C400) Project
| Funder | China Development Bank (CDB) |
|---|---|
| Recipient Organization | Government of Zambia |
| Country | Zambia |
| Start Date | Dec 06, 2015 |
| End Date | Dec 30, 2028 |
| Duration | 4,773 days |
| Number of Grantees | 1 |
| Roles | Recipient |
| Data Source | AidData Chinese Aid |
| Grant ID | 57097 |
Grant Description
[Cancelled] China Development Bank provided $418 million loan for Copperbelt Urban Roads (C400) Project On December 6, 2015, China Development Bank and Zambia's Ministry of Finance signed a $418 million buyer’s credit loan agreement for the Copperbelt Urban Roads (C400) Project.
The proceeds from the loan were to be used to pay for 85% of the total project cost ($492,510,588). The Government of Zambia was responsible for covering the remaining 15%.
This project involves the rehabilitation and upgrading of approximately 406 kilometers of urban township roads in the Copperbelt Province.
The targeted beneficiary districts include: Kalulushi, Chambishi, Kitwe, Chingola, Mufulira, Ndola, Luanshya and Chililabombwe.
Zulu Burrow Ltd. was the contractor responsible for project design and both China Henan International Cooperation Group Company Limited (CHICO) and AVIC were the contractors responsible for project implementation. CHICO was supposed to start work in Kitwe and Luanshya while AVIC was supposed to start work in Chingola.
Construction was initially expected to start in the first quarter of 2016.
However, when asked about the project on November 23, 2016, Zambia’s Minister of Housing and Infrastructure Development said work was expected to commence April 2017. A groundbreaking ceremony ultimately took place on June 26, 2017. The project was expected to be completed 48 months after construction began.
According to notes from a 13th March 2018 parliamentary session, there has been repeated delays in the commencement of works in this project due to delays in providing the advance payment to contractors (consisting of the 15% counterpart funding from the Government of Zambia). CHICO reportedly abandoned the project in 2019 due to inconsistent payments from the Government of Zambia.
According to notes from a 29th January 2021 parliamentary session, the rehabilitation of 406km of urban roads on the Copperbelt Province, under the C400km Road Project, is due for cancellation following guidance from the Ministry of Finance.
Staff Comments
- This project is also known as the 406 km Kitwe and Kalulushi Urban Roads Project. The Chinese project title is 赞比亚铜带省406公里道路升级改造项目 or 铜带省400公里 or 赞比亚铜带省的406公里道路升级改造.
- 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 3.9878-years in 2015. AidData estimates the grace period of the CDB loan that supported the Copperbelt Urban Roads (C400) 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 3. 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 13.3757-years in 2015. AidData estimates the maturity of the CDB loan that supported the Copperbelt Urban Roads (C400) 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 interest rate of all official sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Zambia was 3.9966% in 2015. AidData estimates the interest rate of the CDB loan that supported the Copperbelt Urban Roads (C400) 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
- HE WHO PAYS THE PIPER: ZAMBIA’S GROWING CHINA DEBT CRISIS, 2015 ANNUAL ECONOMIC REPORT, 2015 Annual Report
- Wednesday, 23rd November, 2016 Ministerial Statements
- Government gets $418 million loan for Copperbelt roads from China
- Ministry of Works and Supply Statement
- Over 70 Sub-Contractors Dumped in Kitwe, 2016年上半年全省商务运行情况分析, 2017 Annual Report, 2018 BUDGET ADDRESS By the Minister of Finance Hon. Felix C. Mutati
- MP
- MINISTER of Finance Alexander Chikwanda (left) signs loan agreement documents with China Development Bank Chairman Hu Huai Bang
- 金融机构助力豫企参与“一带一路”建设的现状与思考
- CB lauds Lungu for roads
- Thursday, 28th September, 2017 The House met at 1430 hours [MR SPEAKER in the Chair]
- Avic
- China Henan abandon works over non payment, 2015 Annual Economic Report, 2018 Road Sector Annual Work Plan
- RDA Annual Report 2018
- Tuesday, 13th March, 2018 The House met at 1430 hours
- Friday, 29th January, 2021 The House met at 0900 hours 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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