Active Mixed AidData Chinese Aid

China Eximbank provides $34.7 million preferential buyer’s credit for 20.9 km Gachuurt-Nalaikh-Choir Road Renovation Project (Linked to Record ID#49148)

$34.71M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Government of Mongolia
Country	Mongolia
Start Date	Apr 25, 2019
End Date	Mar 31, 2027
Duration	2,897 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`85685`

Grant Description

China Eximbank provides $34.7 million preferential buyer’s credit for 20.9 km Gachuurt-Nalaikh-Choir Road Renovation Project On November 10, 2015, China Eximbank and the Government of Mongolia signed a general loan agreement regarding the utilization of a $1 billion preferential buyer's credit (PBC) for various projects (as captured via Record ID#49148).

📋 Loan / Grant Terms

💰 Loan Amountagreement

📅 Maturity20 years

⏳ Grace Period7 years

💹 Interest Rate2%

Then, on April 25, 2019, China Eximbank and the Government of Mongolia signed a subsidiary loan (PBC) agreement [CHINA EXIMBANK PBC 2019 (2) TOTAL NO. (485)] worth $34,710,441.03 for the 20.9 km Gachuurt-Nalaikh-Choir Road Renovation Project.

The proceeds of the loan were to be used by the borrower to finance 95% of the $36,537,306.35 cost of a EPC (commercial) contract [UBC-2016-02] between Mongolia’s Capital City Road Development Department and Sinohydro Corporation Limited, which was signed on December 13, 2016 and renewed on March 12, 2019.

The loan officially went into effect on June 24, 2019 (after the borrower met all conditions precedent).

The purpose of the project was to renovate a 20.9 km segment of the АН-3 road from Nalaikh-Choir junction to Gachuurt junction and thereby the connect the eastern provinces of Zamyn-Uud and Choir with the capital city of Ulaanbaatar. The road was designed to meet international standards, be fully lit, and have sidewalks and bicycle lanes.

Sinohydro Corporation Limited was the general EPC contractor responsible for implementation.

However, three Mongolian firms — Dardan Gobi LLC, Tegsh Plant LLC, and Gashuunii Gol LLC — were also involved in implementation as sub-contractors.

Project implementation commenced on April 16, 2019 and the road was supposed to be closed to traffic from April 15, 2019 to November 30, 2019. The road was temporarily reopened to traffic on November 4, 2019. However, the project was only 72.3% complete as of November 15, 2019. Construction was still ongoing in late 2020.

At least 320 people (64 Chinese workers and 256 Mongolian workers) were employed to support the implementation of this project.

📋 Staff Comments

This project is also known as the Nalaikh Road Upgrading Project from Gachuurt Crossroad to Nalaikh and Choir Crossroad and the Paved Road Route of 20.9 km from Gachuurt Crossing to Nalaikh-Choir Project. The Mongolian project title is “Гачууртын уулзвараас Налайх-Чойрын уулзвар хүртэлх 20.9 км авто зам” төсөл. The Chinese project title is 拉萊河公路項目 or 冈楚尔特至那来哈乔伊尔路口公路项目.
The China Eximbank loan 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.
The PBC (loan) agreement can be accessed in its entirety via https://www.dropbox.com/s/xsh53zsx6uhngoo/Mongolia%202018%20China%20Eximbank%20Loan%20for%20Road%20from%20Gachuurt%20Junction%20to%20Nalaikh-Choir%20Junction.pdf?dl=0.

📚 Sources & References

20.9 km highway extension and renewal project from Gachuurt intersection to Nalaih-Choir intersection
Form of Notice of Effectiveness of Loan Agreement
Gachuurt-Nalaikh-Choir road under expansion
Nalaikh road building to begin next month
Nalaikh road construction to be complete in November
Open-source methods for estimating health risks of fine particulate matter from coal-fired power plants: A demonstration from Karachi
Pakistan
Preferential Buyer's Credit Loan Agreement, ГАЧУУРТ-НАЛАЙХ-ЧОЙР ЧИГЛЭЛИЙН ХАТУУ ХУЧИЛТТАЙ АВТОЗАМ АШИГЛАЛТАД ОРЛОО, Гачуурт-Налайх-Чойр чиглэлийн хатуу хучилттай автозам ашиглалтад орлоо, Гачууртын уулзвараас Налайх Чойрын уулзвар хүртэлх 20,9 км авто замын өргөтгөл шинэчлэлт төслийн барилгын ажлын явц 71%, ГАЧУУРТЫН УУЛЗВАРААС НАЛАЙХ-ЧОЙРЫН УУЛЗВАР ХҮРТЭЛХ 20,9 КМ АВТО ЗАМ ЗАСВАРЫН АЖИЛ ЭХЭЛЛЭЭ, Гачууртын уулзвараас Налайх-Чойрын уулзвар хүртэлх 20.9 км авто зам барих төслийн тусгайлсан зээлийн хэлэлцээрийг байгуулжээ, ГАЧУУРТЫН УУЛЗВАРААС НАЛАЙХ-ЧОЙРЫН УУЛЗВАР ХҮРТЭЛХ 20.9 КМ АВТО ЗАМ БАРИХ ТӨСӨЛ, МОНГОЛ УЛСАД ХАРИЛЦАА ХОЛБООНЫ ДЭД БҮТЦИЙГ АВТО ТЭЭВЭР, ЭРЧИМ ХҮЧНИЙ ДЭД БҮТЭЦТЭЙ ХАМТАРСАН ХЭЛБЭРЭЭР ХЭРЭГЖҮҮЛСЭН ТӨСЛҮҮД, МОНГОЛ УЛСЫН ЗАСГИЙН ГАЗАР, БҮГД НАЙРАМДАХ ХЯТАД АРД УЛСЫН ЗАСГИЙН ГАЗАР ХООРОНДЫН ХАМТЫН АЖИЛЛАГААНЫ ТУХАЙ, НАЛАЙХЫН ЗАМЫГ 11 ДҮГЭЭР САРД АШИГЛАЛТАД ОРУУЛАХЫГ ҮҮРЭГ БОЛГОВ, ХЯТАДЫН БУЦАЛТГҮЙ ТУСЛАМЖ БА МОНГОЛЫН ЗЭЭЛСЭН ӨРИЙН ДҮН
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进出口银行与蒙古国政府签署公路项目贷款协议 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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Government of Mongolia

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