Active Development AidData Chinese Aid

China Eximbank provides loan for 400kV North East Grid Project

$32.37M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Government of Tanzania
Country	Tanzania
Start Date	Jan 01, 2016
End Date	Apr 14, 2029
Duration	4,852 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`59890`

Grant Description

China Eximbank provides loan for 400kV North East Grid Project In 2016, China Eximbank agreed -- at least in principle -- to provide a loan worth approximately $588,795,000 to the Government of Tanzania for the 400kV North East Grid Project.

The borrower was expected to use the proceeds of the loan to finance 85% of the cost of a $692.7 million commercial (EPC) contract between TANESCO and Tebian Electric Apparatus (TBEA or 特变电工), which was signed in June 2012. The Government of Tanzania was expected to cover the remaining 15% of the EPC contract cost.

📋 Loan / Grant Terms

📅 Maturity17.5 years

⏳ Grace Period5 years

💹 Interest Rate2%

The project scope involved the construction of (a) a 682 kilometer long 400kV transmission line from Kinyerezi to Arusha via Chalinze and Segera; (b) the construction of 220kV transmission lines from Kibaha to Bagamoyo and from Segera to Tanga; and (c) the construction of power stations in Chalinze, Segera, Kange and Zinga.

Northwest Electric Power Design Institute Co., Ltd. of China Power Engineering Consulting Group signed the final survey design contract on March 19, 2016.

TBEA was the EPC contractor responsible for project implementation and there were some preliminary signs of implementation by TBEA in 2018. The transmission line was originally expected to be commissioned by 2021. However, as of August 2024, AidData had not identified any evidence of project completion.

📋 Staff Comments

This project is also known as the North East Power Transmission Lines Project, the North East Power Transmission Line 400kV Dar-Chalinze-Arusha Project, the Dar es Salaam-Arusha via Chalinze high voltage power transmission line project, and the 400kV North East Grid Dar-Chalinze-Tanga-Arusha Project. The Chinese project title is 坦桑尼亚东北电网 or 坦桑尼亚400千伏输变电线路东北电网 or 坦桑尼亚东北电网项目 or 东北电网项目 or 坦桑尼亚400千伏输变电线路项目 or 达累斯萨拉姆至阿鲁沙输变电线项目 or 达累斯萨拉姆-阿鲁沙输变电项目.
According to the World Bank's Debtor Reporting System (DRS), the weighted average grace period of all official sector lending from Chinese creditors to government and government-guaranteed borrowing institutions in Tanzania was 5-years in 2016. AidData estimates the grace period of the China Eximbank loan by using this figure. See https://www.dropbox.com/scl/fi/s7c2bgl6ybf4mnc10hcc1/Tanzania-s-Borrowings-and-Borrowing-Terms-from-Chinese-Creditors-IDS-August-2024-Export.xlsx?rlkey=0yy73c4iyn1m4lczn63jxsmcc&dl=03. According to the World Bank's Debtor Reporting System (DRS), the weighted average interest rate of all official sector lending from Chinese creditors to government and government-guaranteed borrowing institutions in Tanzania was 2% in 2016. AidData estimates the interest rate of the China Eximbank loan by using this figure. See https://www.dropbox.com/scl/fi/s7c2bgl6ybf4mnc10hcc1/Tanzania-s-Borrowings-and-Borrowing-Terms-from-Chinese-Creditors-IDS-August-2024-Export.xlsx?rlkey=0yy73c4iyn1m4lczn63jxsmcc&dl=04. According to the World Bank's Debtor Reporting System (DRS), the weighted average maturity of all official sector lending from Chinese creditors to government and government-guaranteed borrowing institutions in Tanzania was 17.5-years in 2016. AidData estimates the maturity of the China Eximbank loan by using this figure. See https://www.dropbox.com/scl/fi/s7c2bgl6ybf4mnc10hcc1/Tanzania-s-Borrowings-and-Borrowing-Terms-from-Chinese-Creditors-IDS-August-2024-Export.xlsx?rlkey=0yy73c4iyn1m4lczn63jxsmcc&dl=05. In 2012, China Eximbank financed a natural gas pipeline project (as captured via Record ID#59733 and ID#59752) that would make Dar es Salaam the country's largest source of energy. The Government of Tanzania pursued the 400kV North East Grid Project in order to increase the capacity for distributing electricity from Dar es Salaam.
There is some circumstantial evidence that suggests the $32.3 million loan from China Eximbank in 2016 may have instead supported a police officer housing construction project. This issue merits further investigation. See https://allafrica.com/stories/201602020996.html and https://www.thecitizen.co.tz/tanzania/news/national/sh500-bn-loan-for-police-officers-houses-secured-house-told--2546386 and https://www.parliament.go.tz/polis/index.php/members/231/supp-answers

📚 Sources & References

NEW & ON-GOING POWER PROJECTS TO BE IMPLEMENTED UP TO 2017
中国助力坦桑尼亚输变电发展
TANESCO OVERVIEW
袁林代表会见特变电工驻坦桑尼亚负责人
Implementation Progress in NKRAs
FINAL REPORT ON THE PROJECT FOR FORMULATION OF POWER SYSTEM MASTER PLAN IN DAR ES SALAAM AND COAST REGIONS AND REVIEW OF POWER SYSTEM MASTER PLAN 2012 IN THE UNITED REPUBLIC OF TANZANIA
SPEECH BY THE MINISTER OF ENERGY AND MINERALS HON. PROF. SOSPETER MWIJARUBI MUHONGO (MP.)
PRESENTING TO PARLIAMENT ESTIMATES OF INCOME AND EXPENDITURE FOR 2012/13
Benki ya Exim ya China yaahidi Kushirikiana na Serikali katika Sekta ya Viwanda
TANESCO YAFANYA MAKUBWA KUBORESHA SEKTA YA UMEME NCHINI
China Exim Bank in new ‘big projects’ pledge (Tanzania)
TBEA to strengthen presence across Africa
Primary Questions
Historical Background
ENERGY SECTOR QUARTERLY DIGEST
中电工程西北院获签坦桑尼亚最高电压等级电网项目勘察设计合同
助力非洲国家电力建设！特变电工让“新疆制造”走向“装备世界”
NATIONAL FIVE YEAR DEVELOPMENT PLAN 2016/17 – 2020/21
China-Tanzania Economic and Trade Cooperation
China's economic transformation brings new impetus to the world economy
People's Daily: Chinese enterprises bring us hope
China's Exim Bank Support Zanzibar to Continue
Tanzania's Borrowings and Borrowing Terms from Chinese Creditors IDS August 2024
Dar es Salaam - Chalinze - Tanga - Arusha Line
Tanzaniahttps://www.power-technology.com/marketdata/dar-es-salaam-chalinze-tanga-arusha-line-tanzania/?cf-view
Tanzania Electric Supply Company Limited: TANESCO Overview
Tanzania: China Exim Bank to Support Industrialization
China bank in new 'big projects' pledge
China helps Tanzania develop power transmission and transformation
西北院织网之路多元精湛 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.