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China Eximbank provides RMB 1.445 billion government concessional loan for Addis Ababa Power Network Rehabilitation and Upgrading Project
| Funder | Export-Import Bank of China (China Eximbank) |
|---|---|
| Recipient Organization | Government of Ethiopia |
| Country | Ethiopia |
| Start Date | Jul 28, 2016 |
| End Date | Jan 07, 2026 |
| Duration | 3,450 days |
| Number of Grantees | 1 |
| Roles | Recipient |
| Data Source | AidData Chinese Aid |
| Grant ID | 59428 |
Grant Description
China Eximbank provides RMB 1.445 billion government concessional loan for Addis Ababa Power Network Rehabilitation and Upgrading Project On July 28, 2016, China Eximbank and the Government of Ethiopia signed an RMB 1,445,000,000 (ETB 4,759,718,710) government concessional loan (GCL) agreement [CHINA EXIMBANK GCL No. (2016) 18 TOTAL NO. (588) 1420303052016111722] for the Addis Ababa Power Network Rehabilitation and Upgrading Project.
The Ethiopian House of Representatives ratified the agreement under Proclamation No. 987/2016 on December 27, 2016.
The loan's first and last scheduled principal payment dates were September 21, 2024 and September 21, 2036, respectively. Its first and last scheduled interest payment dates were March 21, 2020 and September 21, 2036, respectively.
The proceeds of the loan were on-lent to Ethiopian Electric Power Corporation (EEPCo) and the borrower was expected to use the proceeds of the GCL to finance a commercial (EPC) contract between EEPco, Ethiopia Electric Utility (EEU), and a consortium (joint venture) consisting of Sinohydro 1st Bureau, Sinohydro 4th Bureau, and PowerChina Hubei Bureau, which was signed in April 2016.
China Eximbank made an initial loan disbursement worth RMB 326,789,264.68 (as part of an advance payment) on December 24, 2019. The World Bank also issued a $62 million loan in support of this project.
The purpose of the project is to rehabilitate and upgrade the power grid — by, among other things, replacing 45kV transmission lines with transmission 132kV lines — in Addis Ababa, Jimma, Dire Dawa, Bahir Dar, Mekele, Hawassa, Adama and Dessie.
Sinohydro 1st Bureau, Sinohydro 4th Bureau, and PowerChina Hubei Bureau are the EPC contractors responsible for project implementation.
The implementation of the project commenced on February 29, 2016 and one section of the power network (in Addis Ababa) was officially completed on March 15, 2019. The project as a whole was 'fully operationalized' as of 2022. However, the project was originally expected to reach completion within 12 months (February 28, 2017).
The Addis Ababa Power Network Rehabilitation and Upgrading Project encountered major implementation problems and delays.
There are also indications that the China Eximbank loan for the Addis Ababa Power Network Rehabilitation and Upgrading Project financially underperformed vis-a-vis the original expectations of the lender.
According to the Government of Ethiopia’s Aid Management Platform, as of September 2019, ICBC suspended about $67 million worth of loan disbursements 'due to [the] cross-default situation of the country’ (see Record ID#58616).
Then, in August 2021, China Eximbank withheld $339 million loan disbursements for 12 projects (including the Addis Ababa Power Network Rehabilitation and Upgrading Project) and halted project implementation due to Government of Ethiopia’s rapidly dwindling foreign exchange reserves and debt sustainability challenges.
Then, after considerable delay, the G20 Common Framework (CF) creditor committee for Ethiopia convened in September 2021, with the French Government and the Chinese Government serving as co-chairs. The CF debt rescheduling talks were still ongoing in mid-2023.
Staff Comments
- This project is also known as the 8 Major Cities Distribution Rehabilitation and Upgrading Project and the Addis Abeba Power Network Rehabilitation & Upgrading Project. The Chinese project title is 公司总承包建设的埃塞俄比亚中低压配网升级改造项.
- The system identification number for the project in the Government of Ethiopia’s Aid Management Platform (AMP) is 87143359111146.
- As of December 24, 2019, the China Eximbank had achieved a 28.5% disbursement rate. The AMP reference to an ETB 48,057,245 loan disbursement on December 24, 2019 appears to be a typographical error (since it represents only 1% of the face value of the loan).
- The loan identification number in the Government of Ethiopia’s Debt Management and Financial Analysis System (DMFAS) is 20926000 and the corresponding project name in DMFAS is ‘EBC 16/18-AA POWER NETWOK REAB’. See https://www.dropbox.com/scl/fi/je0aon75miofi6mt4q5q9/MOFED-Loan-Level-Data-on-Borrowing-Terms-and-Loan-Performance-September-2024_PUBLIC.xlsx?rlkey=murbb074v1px7g4njt0utzxnf&dl=0
Sources & References
- Export-Import Bank of China Loan Agreement for financing the Addis Ababa Power Network Rehabilitation and Upgrading Project Ratification Proclamation
- Export-Import Bank of China Loan Agreement for financing the Addis Ababa Power Network Rehabilitation and Upgrading Project Ratification Proclamation
- 中国金融与工程单位参与埃塞电网重大升级改造项目
- Ethiopia: EPU to Finalize Power Supply Upgrading This Year
- Ethiopia Will Meet Chinese Loan Commitments - Standing Committee
- Ethiopia: House Ratified 387 Million USD Loan
- Public Sector Debt Statistical Bulletin 1 - 22
- Successful Completion of Addis Ababa Section of Upgrading and Transformation Project of Medium- and Low-voltage Distribution Network of Ethiopia
- Eight major cities set to undergo power distribution upgrades
- Electricity Network Reinforcement and Expansion Project (ENREP)
- Ethiopia inaugurates Chinese-built electric power distribution upgrading project
- ENREP - 8 Major Cities Distribution Network Rehabilitation and Upgrading Project March 2019
- 中国公司承建的埃塞俄比亚电力改造项目获赞赏
- 中国企业助力埃塞俄比亚电网升级改造
- 中电装备：埃塞中低压配网升级改造项目亚的斯亚贝巴市标段顺利竣工
- 埃塞俄比亚配网项目正式开工建设
- 谈践大使出席埃塞八城配电网升级项目亚的斯市竣工仪式并走访受益居民
- Public Sector Debt Statistical Bulletin 21
- Public Sector Debt Statistical Bulletin No. 20
- Addis Ababa Power Network Rehablitation and upgrading project
- Notification of Disbursement
- Table of Disbursements
- MPs raise concerns on external debt repayment capacity
- A PROCLAMATION TO RATIFY THE LOAN AGREEMENT BETWEEN THE GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA AND EXPORT-IMPORT BANK OF CHINA
- China Loans to Africa
- China Exim Bank Withholds $339m in Loans Amid Debt Reworks
- China's EximBank withholds $339 mln in funds to Ethiopia, cites debt repayment pressures
- Foreign Loans Plunge amid Debt Reshuffling Talks
- War
- 中电装备：埃塞中低压配网升级改造项目亚的斯亚贝巴市标段顺利竣工
- MOFED Loan-Level Data on Borrowing Terms and Loan Performance September 2024_PUBLIC
- Infrastructure Development in Ethiopia and Its Impact on Economic Diplomacy With China
- List of Ethiopia- China Cooperation Major Projects from Ethiopia's Ministry of Finance September 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.
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Government of Ethiopia
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