ICBC provides $262.8 million loan for Easama-Nakonde, Kasama-Mporokoso and Kasama-Kayambi Transmission Lines and Substations Project

📋 Staff Comments

1. The project is also known as the Nakonde and Kasama Electricity Transmission Project and the 330 kV Kasama-Nakonde, Kasama-Mporokoso and Kasamai-Kayambi Power Transmission and Substations Project. The Chinese project title is 赞比亚330kV输变电工程.
2. Some sources refer to a $70 million Kasama-Nakonde 330-kV Transmission Line Project, which appears to be one of three subcomponents of the Kasama-Nakonde, Kasama-Mporokoso and Kasamai-Kayambi Power Transmission and Substations Project.
3. This project is part of the larger Zambia-Tanzania Interconnection Project.
4. The ICBC loan that was issued for this project is not included in the the database of Chinese loan commitments that SAIS-CARI released in July 2020.
5. In 2018, Blackhall’s Laws of Zambia (revised edition of the laws of Zambia containing primary and secondary legislation) published the following information on its website (https://zambialaws.com/): ‘US$262,877,663.11 term loan facility agreement for Zesco Limited as borrower dated 2nd January, 2018, arranged by Industrial and Commercial Bank of China Limited, with Industrial and Commercial Bank of China Limited, acting as Agent, and the Financial Institutions named in the Agreement, as lenders, for financing of the design, development, manufacturing, construction, testing, delivery, installation, completion and commissioning of (or the equipment of) the Easama-Nakonde, Kasama-Mporokoso and Kasama-Kayambi Transmission Lines, and substations in the Republic of Zambia.’ See https://www.zambialaws.com/Zambia2018Pdfsi/SI%2079%20of%202018.pdf6. More details on construction plans can be found in Source ID#153091.
6. According to the World Bank's Debtor Reporting System (DRS), the weighted average grace period of all ‘private’ sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Zambia was 2.1469-years in 2018. AidData estimates the grace period of the ICBC loan that supported the Easama-Nakonde, Kasama-Mporokoso and Kasama-Kayambi Transmission Lines and Substations Project by using this figure. See https://www.dropbox.com/scl/fi/iymnqwd205mvs5h8crtv8/DRS-May-2024-Extraction-Private-Chinese-Loan-Commitments-to-Zambia.xlsx?rlkey=bi71wlqbrbnfienx75a7bq1g2&dl=0 8. According to the World Bank's Debtor Reporting System (DRS), the weighted average maturity of all ‘private’ sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Zambia was 13.7669-years in 2018. AidData estimates the maturity of the ICBC loan that supported the Easama-Nakonde, Kasama-Mporokoso and Kasama-Kayambi Transmission Lines and Substations Project by using this figure. See https://www.dropbox.com/scl/fi/iymnqwd205mvs5h8crtv8/DRS-May-2024-Extraction-Private-Chinese-Loan-Commitments-to-Zambia.xlsx?rlkey=bi71wlqbrbnfienx75a7bq1g2&dl=09. According to the World Bank's Debtor Reporting System (DRS), the weighted average interest rate of all ‘private’ sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Zambia was 5.5381% in 2018. AidData estimates the interest rate of the ICBC loan that supported the Transmission Lines and Associated Facilities of the Easama-Nakonde, Kasama-Mporokoso and Kasama-Kayambi Transmission Lines and Substations Project by using this figure. See https://www.dropbox.com/scl/fi/iymnqwd205mvs5h8crtv8/DRS-May-2024-Extraction-Private-Chinese-Loan-Commitments-to-Zambia.xlsx?rlkey=bi71wlqbrbnfienx75a7bq1g2&dl=0

📚 Sources & References

• Kasama/Nakonde power link needs $70m
• Progress on SAPP: Actively looking to secure funds
• RWR Advisory: Belt and Road at a Glance
• ZAMBIA'S KASAMA-NAKONDE HIGH-VOLTAGE TRANSMISSION PROJECT HAS AN INVESTMENT OF 70 MILLION US DOLLARS
• ZTK Transmission Interconnector (Zambia section)
• Project Information Document/ Integrated Safeguards Data Sheet (PID/ISDS)
• ENVIRONMENTAL AND SOCIAL IMPACT ASSESSMENT FOR THE ZAMBIA-TANZANIA POWER INTERCONNECTION PROJECT VOLUME 1 - REPORT, http://documents.worldbank.org/curated/en/484501580196294473/pdf/Environmental-and-Social-Management-Plan.pdf
• ZESCO Integrated Report 2017, 2017 Integrated Report
• CHALLENGES AND POSSI BLE SOLUTIONS IN ZAMBIA ’S ELECTRICITY SUPPLY INDUSTRY
• 国核院成功进军赞比亚电网市场
• Zesco awards design contracts under Zambia-Tanzania Interconnection Project
• Zambia-Tanzania Interconnector (P166099) Project Information Document
• Zambia-Tanzania Interconnector (P166099) Project Information Document/ Integrated Safeguards Data Sheet (PID/ISDS)
• Project Details Kasama - Nakonde
• Ksama - Mporokoso & Kasama - Kayambi Overhead Transmission Lines
• Zambia
• CHAPTER 366 - LOANS AND GUARANTEES (AUTHORISATION) ACT: SUBSIDIARY LEGISLATION
• ENVIRONMENTAL AND SOCIAL MANAGEMENT PLAN FOR THE ZAMBIA-TANZANIA POWER INTERCONNECTION PROJECT
• ZTK Transmission Interconnector (Zambia section)
• ZESCO 2016 Integrated Report
• Statutory Instrument No 79 of 2018 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.