CATIC provides $27 million supplier credit for Phase 2 of the Rural Electrification Equipment Acquisition Project (linked to #62609)

In 2005, China National Aero-Technology Import and Export Corporation (CATIC,中国航空技术进出口总公司) provided a $27,015,002 supplier credit to the Government of Zimbabwe for Phase 2 of the Rural Electrification Equipment Acquisition Project. According to a Parliament of Zimbabwe report, the loan matured in February 2016. CATIC allowed its borrower to repay the loan by depositing the foreign currency proceeds from tobacco sales into an escrow account. Upon taking a tobacco contract to raise foreign currency, Zesa was able to sign the agreement, and work was expected to start in early 2016. However, Phase 2 of the project reportedly ran into problems during implementation because of foreign exchange shortages. Phase 2 was officially completed and handed over to the ZESA authorities on 6 March, 2006. The Chinese project title is 第二阶段农村电网项目 or 的农村电网改造 or 津农村电网改造工程. The financing for Phase 1 of the Rural Electrification Equipment Acquisition Project between CATIC and the Government of Zimbabwe is captured in linked project #62609.

Additional details

The Chinese project title is 第二阶段农村电网项目 or 的农村电网改造 or 津农村电网改造工程. Several sources refer to a “$40 million” supplier credit, but these references may refer to the aggregate value of both CATIC supplier credits for Phase 1 and Phase 2 of the Rural Electrification Equipment Acquisition Project (See: Zesa goes farming and China Blasts Sanctions). ZESA used an entity called the Rural Electrification Fund (REF) to facilitate the purchase of equipment from CATIC.

Number of official sources

12

Number of total sources

27