Completed Mixed AidData Chinese Aid

NORINCO provides $100 million supplier credit for Water Pipe System Extension of Sandin Water Supply Plant and Replacing of Old Water Pipe for Nampapa Nakhnone Luang Project

$100M USD

Funder	China North Industries Group Corporation Limited (NORINCO Group)
Recipient Organization	Nakhonluang Water Supply Enterprise
Country	Lao People's Democratic Republic
Start Date	Jan 01, 2016
End Date	Aug 27, 2026
Duration	3,891 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`64712`

Grant Description

NORINCO provides $100 million supplier credit for Water Pipe System Extension of Sandin Water Supply Plant and Replacing of Old Water Pipe for Nampapa Nakhnone Luang Project In 2016, China North Industries Corporation (NORINCO), a Chinese state-owned company, issued a $100 million supplier credit to Nakhonluang Water Supply Enterprise — a special purpose vehicle that is owned by Asia Investment, Development and Construction Sole Co., Ltd. — for the Water Pipe System Extension of Sandin Water Supply Plant and Replacing of Old Water Pipe for Nampapa Nakhnone Luang Project.

📋 Loan / Grant Terms

💰 Loan Amountincluded a 12

📅 Maturity12.5 years

⏳ Grace Period0.5 years

💹 Interest Rate2.5%

The Ministry of Finance of Laos issued a sovereign guarantee in support of the loan.

The project involved the expansion of a 60 km water distribution pipeline from Sendine (Sandin) BOT Project to Naxaithong District; the expansion of an 80 km water distribution pipeline for Dongmakkhay water treatment plant to Saithany district and Saysettha district; and the installation of a water supply supervisory control and data acquisition system to help reduce the water leakage and improve the management efficiency.

Upon completion, it was expected that the project would supply 30,000 cubic meters of healthy and sanitary water per day to nearly 23,000 households in the Lao capital of Vientiane.

NORINCO was the EPC contractor responsible for implementing the project according to the terms of the commercial contract that was signed on March 31, 2016. Project implementation commenced on October 12, 2016 and ended on February 27, 2019.

📋 Staff Comments

The Chinese project title is 老挝万象市政供水项目.
One official source suggests that the face value of the supplier credit was $70 million. AidData relies on an estimate from a more recent official source for the time being. This issue merits further investigation.
According to the World Bank's Debtor Reporting System (DRS), the weighted average interest rate of all ‘private’ sector lending commitments (worth $100 million) from all Chinese creditors to government and government-guaranteed borrowing institutions in Laos was 2.5% in 2016. AidData estimates the interest rate of the NORINCO loan that supported the Water Pipe System Extension of Sandin Water Supply Plant and Replacing of Old Water Pipe for Nampapa Nakhnone Luang Project by using this figure. See https://www.dropbox.com/scl/fi/rtg798g5nyuf1xwnhcenv/Private-Chinese-Loans-to-Laos-November-2023-DRS-Data-Extraction.xlsx?rlkey=qpnwna418xgg3f38iki58a3g1&dl=04. According to the World Bank's Debtor Reporting System (DRS), the weighted average maturity of all ‘private’ sector lending commitments (worth $100 million) from all Chinese creditors to government and government-guaranteed borrowing institutions in Laos was 12.5-years in 2016. AidData estimates the maturity of the NORINCO loan that supported the Water Pipe System Extension of Sandin Water Supply Plant and Replacing of Old Water Pipe for Nampapa Nakhnone Luang Project by using this figure. See https://www.dropbox.com/scl/fi/rtg798g5nyuf1xwnhcenv/Private-Chinese-Loans-to-Laos-November-2023-DRS-Data-Extraction.xlsx?rlkey=qpnwna418xgg3f38iki58a3g1&dl=05. According to the World Bank's Debtor Reporting System (DRS), the weighted average grace period of all ‘private’ sector lending commitments (worth $100 million) from all Chinese creditors to government and government-guaranteed borrowing institutions in Laos was 0.5-years in 2016. AidData estimates the grace period of the NORINCO loan that supported the Water Pipe System Extension of Sandin Water Supply Plant and Replacing of Old Water Pipe for Nampapa Nakhnone Luang Project by using this figure. See https://www.dropbox.com/scl/fi/rtg798g5nyuf1xwnhcenv/Private-Chinese-Loans-to-Laos-November-2023-DRS-Data-Extraction.xlsx?rlkey=qpnwna418xgg3f38iki58a3g1&dl=06. China Eximbank financed the Dongmarkkhai Water Supply Expansion Project (see Project ID#33828) and the Sendine (Sandin) BOT Project (see Project ID#85306).

📚 Sources & References

- President Wang Yuetao Paid a Visit to Laos and Attended the Opening Ceremony of Xeset3 Hydropower Station -, ພິທີເປີດນຳໃຊ້ ໂຮງງານຜະລິດນໍ້າປະປາບ້ານນາລ້ອງ, ເມືອງຫາດຊາຍຟອງ ນະຄອນຫຼວງວຽງຈັນ, ກຳລັງການຜະລິດ 1.500ແມັດກ້ອນ/ວັນ, ຄັ້ງວັນທີ 16 ມັງກອນ 2019 ທຶນກູ້ຢືມຈາກ NORINCO, ພິທີເປີດນຳໃຊ້ ໂຮງງານຜະລິດນໍ້າປະປາບ້ານໂຄກແຫ້, ເມືອງສັງທອງ ນະຄອນຫຼວງວຽງຈັນ, ກຳລັງການຜະລິດ 1.000ແມັດກ້ອນ/ວັນ, ຄັ້ງວັນທີ 11 ມັງກອນ 2019 ທຶນກູ້ຢືມຈາກ NORINCO
Laos begins upgrading water pipe system in capital
Vientiane Capital Water Supply State Enterprise Annual Report 2016
中企承建的老挝万象市政供水项目为60多个村庄提供清洁自来水
Expectation of Water Works Association in Lao PDR
Vienyiane Capital water Supply State Enterprise
Water supply project built by Chinese firm completes in Lao capital, - President Wang Yuetao Paid a Visit to Laos and Attended the Opening Ceremony of Xeset3 Hydropower Station -
Vientiane Capital W ater Supply State Enterprise Annual Report 2019
LAOWATER 2020 BROCHURE, naxaithong-piped-water-extension-expands-delivery-to-vientiane-residents
Naxaithong piped water extension expands delivery to Vientiane residents
Ground Breaking Ceremony
Water Pipe System Extension and Improvement of System Management Project in Vientiane Capital
OPENING CEREMONY 2 JUNE 2018 By The Governor Of Vientiane Capital
Commercial Contract Signing Ceremony Water Pipe Extension Project In Vientiane Capital
Sending water treatment plant comes on line
王其辉参赞出席老挝万象市供水项目竣工仪式
中国公司承建老挝首都市政供水项目竣工
Water supply project built by Chinese firm completes in Lao capital
Private Chinese Loans to Laos November 2023 DRS Data Extraction 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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Nakhonluang Water Supply Enterprise

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