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Overview

ICBC provides export buyer's credit for acquisition of 50 double-decker buses

Commitments (Constant USD, 2023)$99,578,426
Commitment Year•2005Country of Activity•IranDirect Recipient Country of Incorporation•IranSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Pipeline: Commitment

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jan 1, 2005
First repayment (originally scheduled)
Nov 23, 2008
Last repayment (originally scheduled)
Feb 28, 2016

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Commercial Banks

  • Industrial and Commercial Bank of China (ICBC)

Receiving agencies

State-owned Banks

  • Bank Melli Iran

Implementing agencies

State-owned companies

  • China CNR Corporation

Loan description

ICBC provides export buyer's credit for acquisition of 50 double-decker buses

Grace period•3.8976 yearsGrant element•26.7555%Interest rate (t₀)•4.5487%Interest type•Fixed Interest RateMaturity•11.165 years

Narrative

Full Description

Project narrative

In 2005, the Industrial and Commercial Bank of China (ICBC) signed an export buyer's credit agreement with Bank Melli Iran -- an Iranian state-owned bank -- for the acquisition of 50 double-decker buses. The borrowing terms of the loan are unknown. However, it is known that the borrower was responsible for using the loan proceeds to partially finance an EUR 47 million commercial contract between China CNR Corporation Limited and Raja Passenger Train Company (a subsidiary of Islamic Republic of Iran Railways), which was signed in May 2006. The buses were originally scheduled for delivery 26-28 months after the commercial contract went into effect.

Staff comments

1. The face value of the export buyer's credit is unknown. For the time being, AidData assumes that it was worth 85% of the total cost (EUR 39.95 million) of the EUR 47 million commercial contract. This issue warants further investigation. 2. 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 Iran was 3.8976 years in 2005. AidData estimates the grace period of the ICBC loan by using this figure. See https://www.dropbox.com/scl/fi/ef7q4y9pxjk6q3syuqmjy/May-2024-DRS-Extraction-of-Data-on-Official-and-Private-Chinese-Loans-to-Iran-and-Borrowing-Terms.xlsx?rlkey=wiqjmhuwunp3jelz3jyfepny8&dl=0 . 3. 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 Iran was 11.165 years in 2005. AidData estimates the maturity of the ICBC loan by using this figure. See https://www.dropbox.com/scl/fi/ef7q4y9pxjk6q3syuqmjy/May-2024-DRS-Extraction-of-Data-on-Official-and-Private-Chinese-Loans-to-Iran-and-Borrowing-Terms.xlsx?rlkey=wiqjmhuwunp3jelz3jyfepny8&dl=0. 4. 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 Iran was 4.5487% in 2095. AidData estimates the interest rate of the ICBC loan by using this figure. See https://www.dropbox.com/scl/fi/ef7q4y9pxjk6q3syuqmjy/May-2024-DRS-Extraction-of-Data-on-Official-and-Private-Chinese-Loans-to-Iran-and-Borrowing-Terms.xlsx?rlkey=wiqjmhuwunp3jelz3jyfepny8&dl=0.