Active Mixed AidData Chinese Aid

Bank of China contributes $55.9 million to $85.7 million buyer’s credit for restoration and improvement of 3 highways (Linked to Record ID#38936)

$60M USD

Funder	Bank of China (BOC)
Recipient Organization	Government of Ecuador
Country	Ecuador
Start Date	Mar 31, 2015
End Date	Mar 01, 2029
Duration	5,084 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`58983`

Grant Description

Bank of China contributes $55.9 million to $85.7 million buyer’s credit for restoration and improvement of 3 Ecuadorian highways in 2015 On March 31, 2015, the Government of Ecuador signed a $85,710,077.90 syndicated buyer’s credit loan agreement with the Panama Branch of Bank of China Limited and the Hong Kong Branch of Deutsche Bank AG for the restoration and improvement of 3 highways in Ecuador.

The Panama Branch of Bank of China Limited contributed $59,997,054.53 and the Hong Kong Branch of Deutsche Bank AG contributed $25,713,023.37.

📋 Loan / Grant Terms

💰 Loan Amountcarried the following borrowing terms: an annual interest rate of 6-month LIBOR plus a 3

⏳ Grace Period3 years

The loan also benefited from a Sinosure credit insurance policy, which covered political and commercial risks for the loan’s principal amount plus accrued risk (with a 95% indemnity ratio for the buyer’s credit facility). The borrower was responsible for making 20, equal, semi-annual principal payments.

The proceeds of the loan were to be used by the borrower to finance up to 85% of the total cost of a $100,835,385.77 commercial contract [RE-28-3OB-MTOP-2014] between the Government of Ecuador’s Ministry of Transportation and Public Works (MTOP) and a consortium consisting of China Civil Engineering Construction Corporation Ltd. (CCECC) and Verdú S.A., which was signed on March 17, 2015.

The loan’s (principal) outstanding amount was $53,193,335.61 as of December 31, 2021 and $45,009,745.51 as of November 30, 2022.

The purpose of the project was to (a) restore and improve the 24 km Sigchos—Chugchilán highway, (b) restore and improve the 80.85 km Buena Vista—Vega Rivera—Paccha—Zaruma Highway Buena Vista—Vega highway (and thereby connect the E25 road axis and the towns located in the upper part of the province of El Oro), and (c) widen Ordoñez Lasso avenue, which serves as a link between the E25 and E35 corridors and connects the provinces of Azuay, Guayas, and El Oro.

The Ordoñez Lasso avenue widening project component consists of two sections: one that runs from Las Américas avenue to the Ciudad de Cuenca school and another that runs from the Ciudad de Cuenca school to Sayausi.

China Civil Engineering Construction Corporation Ltd. (CCECC) and Verdú S.A. (an Ecuadorian company) were the contractors responsible for project implementation.

Construction began on June 18, 2015 after an advance payment (worth 15% of the commercial contract value) was made to CCECC and Verdú S.A.

As of September 2018, the restoration and improvement of the 24 km Sigchos—Chugchilán highway was complete and the 80.85 km Buena Vista—Vega Rivera—Paccha—Zaruma Highway Buena Vista—Vega highway had achieved a 100% completion rate; however, the widening of Ordoñez Lasso avenue had only achieved an 85% completion rate.

The project was originally scheduled to reach completion on June 18, 2017.

📋 Staff Comments

The Spanish project title is 'El proyecto de 3 carreteras en el país' or 'La rehabilitación y mejoramiento de la carretera Sigchos – Chugchilán y la ampliación de la avenida Ordoñez Lasso, en la provincia de Azuay; y la rectificación y mejoramiento de la arteria vial Buena Vista – Vega Rivera – Paccha – Zaruma, ubicada en El Oro'.
For loan and debt rescheduling records with variable interest rates, AidData calculates the all-in interest rate at T0 based on the reference rate (such as LIBOR or EURIBOR) on the loan start date, plus any known margin. Please see the methodology for additional details.
One official source refer to the value of the commercial contract as $100,868,000 and the contract signing date as April 9, 2015. This issue warrants further investigation.
Ashurst served as a legal adviser on the transaction.
The Ecuadorian Ministry of Finance loan identification number is 28093000.
The loan agreement can be accessed in its entirety via https://www.dropbox.com/scl/fi/up6e7g66sx5zzyfneqzx5/Ecuador-2015-Bank-of-China-and-Deutsche-Bank-syndicated-loan-for-Restoration-and-Improvement-of-3-Highways-Project.pdf?rlkey=xsd8jr49f22j97a6a599jyzad&dl=0

📚 Sources & References

2017 Bond Prospectus, 2019 Bond Prospectus Government of Ecuador
Agreement 0128: Give powers and powers to the following person: Attorney Willam Vásconez Rubio
Undersecretary of Public Financing
ANEXO 1 Oficio Senplades-SZ3C-2014-0462-OF. Actualiza prioridad v¡a Sigchos Chugchil n
ANEXO 10 Oficio No. 00603- PGE. Procuradurกa autorizข arbitraje de corte inglesa
ANEXO 11 Acta Resolutiva No. 008. Comit‚ de Deuda autoriz¢ cr‚dito con Bank of China Limited
ANEXO 2 Oficio MF-SFP-2015-085. Pedido a Bank of China cr‚dito para 3 carreteras
ANEXO 3 Oficio Senplades-SZ7S-2015-0093-OF. Prioridad reconstruc v¡a Buena Vista-Vega Rivera-Pacha-Zaruma
ANEXO 5 Oficio N§MTOP-CGP-15-59-OF. Certifica estudios v¡a Buena Vista-Vega Rivera-Pacha-Zaruma
ANEXO 6 Oficio NงMTOP-CGP-15-61-OF. Certifica estudios Ampliaciขn Av. Ordขคez Lasso
ANEXO 7 Oficio N§MTOP-CGP-15-63-OF. Certifica estudios V¡a Sigchos Chugchil n
ANEXO 9 Contrato de Ejecuciขn de Obra. MTOP con CCEECC
ARAUZ FIRMÓ EL ENDEUDAMIENTO DE LA PATRIA
Awards 2016
Base-de-Datos-Boletin-de-Deuda-Noviembre-2022
Building Development for a New Era: China’s Infrastructure Projects in Latin America and the Caribbean
Construction of the Buenavista - Vega Rivera - Paccha - Zaruma road continues
CONTRALORÍA GENERAL DEL ESTADO
COORDINACIÓN GENERAL DE PLANIFICACIÓN
Cuaderno-Estadístico-Agosto-2022
Cuaderno-Estadístico-Boletín
Debt Bulletin Database JAN 2024
Debt Bulletin Database MAR 2023
El detalle de los contratos de crédito externos o internos
Estadísticas Deuda Pública
Examen especial en el MINISTERIO DE FINANZAS y ENTIDADES RELACIONADA, https://www.dropbox.com/s/26vmrlpyyf6e96b/8905635.pdf?dl=0
Leyes y reglamentos - Financiero
Literal-l-Contratos-de-créditos-externos-e-internos.pdf
Oficio Nro. SENPLADES-SGPBV-2014-1148-0F Quito
D.M., 18 de noviembre de 2014:
Perfil Proyecto 3 Carreteras
Registro Oficial
Resolucion No. 035
Resolution
SEP 2021 Debt Bulletin Database
The Governance Awakens: Capítulo China-Ecuador
TRES PROYECTOS VIALES SE FINANCIAN CON CRÉDITO CHINO
US$85,710,077.90 Credit Facility Agreement, “Incidencia de la Participación de China en Ecuador como Estrategia de Integración Comercial y Desarrollo Económico” 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 Ecuador

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