China Eximbank pledges a $190 million USD to Agua y Saneamientos Argentinos SA for the Río Subterráneo Sur Section II Project

China Eximbank pledges a $190 million USD to Agua y Saneamientos Argentinos SA for the Río Subterráneo Sur Section II Project As of June 30, 2018, Electroengineering and China Gezhouba Group Corporation (CGGC) and the Export-Import Bank of China had agreed to aid in the construction of the Río Subterráneo Sur Section II project and the associated Lifting Station 2 (Estación Elevadoras 2) in Buenos Aires province.

The Export-Import Bank of China pledged to loan USD 190 million to Agua y Saneamientos Argentinos SA (AYSA) for the project. The loan has a 15-year maturity.

The loan was to be guaranteed by the China Export and Credit Insurance Corporation (Sinosure) with a final rate (including the guarantee) in the same area as the bond of 500 million dollars with a rate of 6.625% and maturity in 2023 issued by Agua y Saneamientos Argentinos SA (AYSA) on January 26, 2018 in the United Kingdom.

Previously, a consortium of China Gezhouba Group Corporation (CGGC) and Electroingeniería signed a construction contract on September 15, 2017 for the project.

According to a report from the Auditor General of Argentina, however, the contract contained stipulations that it would not enter force until a loan agreement was signed with China Eximbank to finance the project within 180 days.

There were indications that the consortium was expected to sign the $190 million financing agreement with China Eximbank and AySA (as guarantor) in Buenos Aires later in November 2018 during Chinese President Xi Jinping's visit to Argentina for the G20 Summit.

However, after multiple extensions of the deadline to secure funding, the contract with CGGC was ultimately voided on June 30, 2021 (communicated to CGGC on December 21, 2021).

A report from the Auditor General of Argentina in 2022 indicated that a new bidding process was expected to take place for the Río Subterráneo Sur Section II and Lifting Station 2 projects, and that financing was now being sought from the Development Bank of Latin America and the Caribbean (CAF), which also financed Section I of the project.

It is thus unlikely financing from China Eximbank will ever be formally committed for this project.

The Río Subterráneo Sur project includes the construction of 9.70 kilometers of aqueduct with a shield tuner with voussoirs measuring 3,900 millimeters in internal diameter to connect the first lifting station with the second and transport potable water to the Esteban Echeverría district.

In turn, the UTE will have to build a lifting station in that town to propel a maximum of 17,000 cubic meters of water from the General Belgrano plant, which will benefit at least 2.50 million people.

The Río Subterráneo Sur will end at a site located in the Monte Grande area, where another lifting station will be installed with drives that will allow the transportation of surface water to the districts of Esteban Echeverría, Ezeiza and La Matanza.