Chinese Government pledges support for Deepwater Seaport Project (linked to #71266)

In November 2013, the Chinese Government announced that it would open a trade mission in São Tomé and Príncipe. This action came roughly four years before the Chinese Government and the Government of São Tomé and Príncipe resumed diplomatic relations (on December 26, 2017). Shortly after establishing a trade mission in São Tomé and Príncipe (on November 14, 2013), the Chinese Government expressed interest in funding the construction a deep-water seaport in São Tomé and Príncipe. The estimated cost of this project was $400 million. Its purpose was to facilitate the export of oil and sea-borne commerce. Then, in October 2015, the Government of São Tomé and Príncipe (STP) signed a memorandum of understanding (MoU) with China Harbor Engineering Company (CHEC) regarding the potential construction of the seaport as a Public-Private Partnership (PPP). The MOU specified that CHEC would first assess the feasibility of the project. Also, according to the MoU, CHEC reportedly pledged to invest at least $120 million. China Road and Bridge Corporation (CRBC), along with Macau Legend Development Ltd, also expressed interest in the deepwater seaport project. Then, in May 2017, the Chinese Government and the Government of São Tomé and Príncipe signed a bilateral cooperation agreement, in which the Chinese Government agreed to provide $146 million of funding for infrastructure projects between 2017 and 2022 to the Government of São Tomé and Príncipe (see Project ID#71266). One of the infrastructure projects identified in the bilateral cooperation agreement was the deepwater seaport project. However, in 2018, the Chinese Government began to raise concerns about the Government of São Tomé and Príncipe’s ability to take on substantially higher level public debt to facilitate the implementation of the project. In late November 2019, the STP’s Minister of Public Works, Infrastructure and Natural Resources, Osvaldo Abreu, announced the launch of the international tender for the construction of the deepwater port in the village of Fernão Dias within Lobata district. The project described in the international tender envisages a port with a depth of 16 meters and the construction of a multipurpose terminal with a capacity of up to 30,000 tons. The Government of the STP also invited construction companies to submit proposals to build the port according o a Design, Build, Finance and Operate (DBFO) model, which suggests that this project may ultimately be financed through a special purpose vehicle (SPV).

Number of official sources

2

Number of total sources

12