Completed Mixed AidData Chinese Aid

China Eximbank provides $50 million preferential buyer’s credit for Zamyn-Uud Infrastructure Improvement Project

$50M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Mongolia Ministry of Finance
Country	Mongolia
Start Date	Jun 01, 2010
End Date	Sep 16, 2027
Duration	6,316 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`68942`

Grant Description

China Eximbank provides $50 million preferential buyer’s credit for Zamyn-Uud Infrastructure Improvement Project In 2008, the Governor's office of Zamyn-Uud Free Zone initiated and formulated the Zamyn-Uud Infrastructure Improvement Project.

Then, on June 1, 2010, the Ministry of Finance of Mongolia and China Eximbank signed a $50 million preferential buyer's credit (PBC) agreement for the Zamyn-Uud Infrastructure Improvement Project.

The PBC was approved under a $300 million general loan agreement (line of credit) for various projects that was also signed by the two governments on June 1, 2010.

📋 Loan / Grant Terms

📅 Maturity20 years

💹 Interest Rate1.75%

The borrower was to use the proceeds of the PBC to partially finance a $58.8 million commercial (EPC) contract between Mongolia’s Ministry of Roads, Transportation, Construction and Urban Development and China CAMC Engineering Co., Ltd. (CAMCE), which was signed in January 2011. The remaining $8.8 million will be provided by the Government of Mongolia.

The purpose of the project was to construct a water treatment plant, a wastewater treatment plant, a 90MW thermal power plant, an electricity substation, power transmission lines, and 13.5 km of roads, lighting and sidewalks within Zamyn-Uud soum and the Zamyn-Uud Free Zone.

Zamyn-Uud soum (district) is the busiest international border port between Mongolia and the People’s Republic of China (PRC). The local population relies heavily on border traffic and trade activities.

The Zamyn-Uud free zone, which is located 780 kilometers southeast of Ulaanbaatar and adjacent to the border crossing point at Zamyn-Uud, is the border crossing closest to Tianjin, the gateway port in the PRC for Mongolia’s shipments to Japan and the Republic of Korea. CAMCE was the EPC contractor responsible for project implementation.

The project commenced construction in 2011. Construction of the water treatment plant began in 2012.

Mongolia’s Prime Minister and Minister of Economic Development conducted an on-site project inspection in early March 2013 and then again on November 19, 2013.

Representatives from China Eximbank’s Concessional Loan Department conducted an on-site project inspection on August 18, 2014. A final project handover certificate was issued on October 27, 2015.

However, as of December 2017, the water treatment plant and the thermal power plant had still not been put into operation because there were insufficient users/customers to enable cost recovery. As of July 2021, the Zamyn-Uud Free (Economic) Zone had still not opened.

📋 Staff Comments

This project is also known as the Zamyn-Üüd Infrastructure Improvement Project. The Chinese project title is 蒙古扎门乌德基础设施改善项目. The Mongolian project title is “Замын-Үүдийн дэд бүтцийг сайжруулах” төсөл or Замын-Үүдийн дэд бүтцийг сайжруулах төсөл.
The China Eximbank loan (PBC) that supported this project is not included in the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020.
On March 30, 2015, CAMCE signed an RMB 17.32 million contract for the construction, installation and construction of the Zamyn-Uud Infrastructure Improvement Project. Given that this event took place several years after project implementation began, it is possible that this contract was an amendment to the January 2011 commercial contract (providing top-up funding for new and additional activities that were not specified in the original contract). This issue warrants further investigation.
Project ID#85842 was financed through the same $300 million general loan agreement (line of credit) with the same borrowing terms.

📚 Sources & References

Hystory
Facilities built in Zamyn-Uud to be put into operation
THE MAIN CONSTRUCTION WORK OF PROJECT OF INFRASTRUCTURE IMPROVEMENT IN ZAMYN-UUD OF MONGOLIA UNDERTAKEN BY CAMCE OFFICIALLY COMPLETED
Trade Logistics in Landlocked and Resource Cursed Asian Countries, “The trade logistics in resource-cursed land-locked Asian countries” book launching
中工国际蒙古扎门乌德基础设施改善项目主要施工内容正式完工, МОНГОЛ УЛСЫН ЗАСГИЙН ГАЗАР, БҮГД НАЙРАМДАХ ХЯТАД АРД УЛСЫН ЗАСГИЙН ГАЗАР ХООРОНДЫН ХАМТЫН АЖИЛЛАГААНЫ ТУХАЙ
蒙古扎门乌德基础设施改善项目
蒙古扎门乌德基础设施改善项目EPC总承包合同签署
Proposed Loan Mongolia: Developing the Economic Cooperation Zone Project
Government Concessional Loan & Preferential Buyer’s Credit Brochure, Замын-Үүдэд баригдсан барилга, байгууламжуудыг ашиглаж эхэлнэ, Замын-Үүдийн чөлөөт бүсэд тулгараад байгаа асуудлыг судлах ажлын хэсэг байгуулна, Түүхэн товчоо
MONGOLIAN PRIME MINISTER INSPECTED CAMCE ZAMYN-UUD INFRASTRUCTURE IMPROVEMENT PROJECT
Deputy Prime Minister U.Enkhtuvshin works in Zamyn-Uud free zone
ADB LOAN AGREEMENT BACKED, Замын-Үүдийн дэд бүтцийг сайжруулах төслийн хүрээнд хийгдэж буй 90 мВт дулааны станцыг нүүрсээр хангах төмөр замын ажил /Дорноговь, Замын-Үүд /”-ыг ашиглалтанд хүлээлгэн өгөхөд бэлэн болоод байна., БНХАУ-ын Хөнгөлөлттэй зээлээр Зүтгүүр вагон худалдан авна, АВСТРАЛИ УЛС
THE PEOPLE'S REPUBLIC OF CHINA
CONCESSIONAL LOAN DEPARTMENT OF CHINA EXIM BANK INSPECTED CAMCE ZAMYN-UUD INFRASTRUCTURE IMPROVEMENT PROJECT IN MONGOLIA
CCTV FULL-LENGTH DOCUMENTARY THE BELT AND ROAD AIRING CHINA-BELARUS INDUSTRIAL PARK AND MONGOLIA’S ZAMYN-UUD INFRASTRUCTURE IMPROVEMENT PROJECT, 《一带一路》第三集光明纽带
外交部副部长谢杭生一行视察中工国际蒙古扎门乌德基础设施改善项目现场
中国驻蒙古国大使视察中工国际蒙古扎门乌德基础设施改善项目
蒙古扎门乌德基础设施改善项目(设计概算的编制与审核)
公司签订中工国际蒙古扎门乌德基础设施改善项目土建安装施工承包合同, Н.ТИЛЕУХАН: ЭНЭ ОНД 989 ТӨСЛИЙГ 1.9 ИХ НАЯД ТӨГРӨГӨӨР ХЭРЭГЖҮҮЛНЭ, Замын-Үүдийн чөлөөт бүс байгуулах ажлыг эрчимжүүлнэ
蒙古国扎门乌德自由贸易区基础设施建设10月份将完工
China Overseas Development Finance 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.