Completed Mixed AidData Chinese Aid

China Eximbank provides preferential buyer’s credit for Hydro-Generator Manufacturing Plant Construction Project (Linked to Record ID#63667, 98029, 96221)

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Myanmar Ministry of Industry
Country	Myanmar
Start Date	Dec 11, 2007
End Date	May 29, 2033
Duration	9,301 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`67566`

Grant Description

China Eximbank provides preferential buyer’s credit for Hydro-Generator Manufacturing Plant Construction Project On December 11, 2007, China Eximbank, the Central Bank of Myanmar, and Myanmar Foreign Trade Bank signed a preferential buyer’s credit (PBC) agreement for the Hydro-Generator Manufacturing Plant Construction Project.

The face value and borrowing terms of the PBC are unknown.

However, it is known that the borrower was to use the proceeds of the PBC to finance a commercial contract that Myanmar’s Ministry of Industry No. 2 signed with China National Machinery Import and Export Group in 2006.

The purpose of the project was to construct a hydro-generator manufacturing plant (owned by Myanmar’s Ministry of Industry No. 2) capable of supporting small-scale hydropower projects. China National Machinery Import and Export Group was the contractor responsible for implementation. This project was completed on December 31, 2009.

After the enterprise is completed, it will produce mixed-flow, axial-flow, and tubular units with a unit capacity of less than 30,000 kilowatts, which are widely used in small water conservancy projects.

There are some indications that the China Eximbank loan for the Hydro-Generator Manufacturing Plant Construction Project may have financially underperformed vis-a-vis the original expectations of the lender.

In 2020, China Eximbank and the Government of Myanmar signed a debt suspension agreement as part of the G-20 Debt Service Suspension Initiative (DSSI).

Under the terms of the agreement, the lender agreed to suspend principal and interest payments due between May 1, 2020 and December 31, 2020 under 3 buyer’s credit loan (BCL) agreements, 6 government concessional loan (GCL) agreements, and 27 preferential buyer’s credit (PBC) agreements (as captured via Record ID#98029).

Debt service payments under many of these loan agreements were again deferred in 2021 (as captured via Record ID#96221).

📋 Staff Comments

This project is also known as the Turbine Generator Plant Construction Project and the Myanmar Water Turbine Foreign Aid Project. The Chinese project title is 缅甸水轮发电机制造厂 or 缅甸水轮机援外项目.
The PBC that supported this project may have also supported a Railroad Equipment Procurement Project (captured in Project ID#63667).
This China Eximbank loan is not included in the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020.
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 Myanmar was 14.5376-years in 2007. AidData estimates the maturity of the China Eximbank loan that supported the Hydro-Generator Manufacturing Plant Construction Project by using this figure. See https://www.dropbox.com/s/949n5rctiue6d7c/IDS_Average_grace_period_and_maturity_on_new_external_debt_commitments.xlsx?dl=0 5. 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 Myanmar was 5.56-years in 2007. AidData estimates the grace period of the China Eximbank loan that supported the Hydro-Generator Manufacturing Plant Construction Project by using this figure. See https://www.dropbox.com/s/949n5rctiue6d7c/IDS_Average_grace_period_and_maturity_on_new_external_debt_commitments.xlsx?dl=0 6. 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 Myanmar was 2.8812% in 2007. AidData estimates the interest rate of the China Eximbank loan that supported the Hydro-Generator Manufacturing Plant Construction Project by using this figure. See https://www.dropbox.com/s/ab8qt4n6jijcbhd/IDS_Average%20interest%20on%20new%20external%20debt%20commitments.xlsx?dl=0

📚 Sources & References

缅甸总理出席我承建水轮发电机厂竣工典礼
通用技术集团缅甸水轮发电机制造厂项目竣工
中机公司出口缅甸钢轨业务首批货物顺利发运
中机公司出口缅甸钢轨项目及水轮发电机制造厂项目正式启动
Business Express
缅甸水轮发电机制造厂举行竣工典礼
我对缅优惠买方信贷以及优惠贷款个贷协议在仰光签署
China's Overseas Development Finance
China Machinery Corporation
Sustainable Development Report 2010-2011
The Prime Minister of Myanmar Attends the Completion Ceremony of China's Contracted Hydrogenerator Plant 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.