China Eximbank provides $65.359 million buyer’s credit loan for 7 municipal hospitals and 9 health centers (linked to #34030)

On 19 July, 2007, China Eximbank and the Government of Angola signed a $500 billion Master Loan Facility Agreement (MLFA). All of the subsidiary buyer’s credit loans approved through this MLFA carried the following terms: an interest rate of 3-month LIBOR plus a 1.5% margin (or 6.86% at the time that the MLFA was signed), a 22 year maturity period, and 5 year grace period (see Project ID#34030). Under this MLFA, China Eximbank and the Government of Angola signed a $65,359,493.20 subsidiary buyer’s credit loan agreement to support “complementary actions” related to the 7 municipal hospitals and 9 health centers (See: UNCOVERING AGENCY: ANGOLA’S MANAGEMENT OF RELATIONS WITH CHINA, p. 291). The proceeds of this loan were used to partially finance a $72,620,548.00 commercial contract with Sinohydro (See: UNCOVERING AGENCY: ANGOLA’S MANAGEMENT OF RELATIONS WITH CHINA, p. 291).As of 30 June, 2008, the loan had not yet disbursed (See: UNCOVERING AGENCY: ANGOLA’S MANAGEMENT OF RELATIONS WITH CHINA, p. 291). SAIS-CARI identifies this project as having entered implementation, but its precise implementation start and end dates are unknown.The specific hospitals and health centers that were supported by this loan are also unknown, but they all presumably were projects financed by a 2004 China Eximbank MLFA to Government of Angola (see Project ID#42029).

Additional details

In July 2020, AidData asked Dr. Lucy Corkin, a leading expert on Chinese lending to Angola, whether the second, third, and fourth master loan facility agreements (MLFAs) that the Angolan Government signed with China Eximbank in 2007 and 2009 were structured as a buyer’s credit loans like the first MLFA that the Angolan Government signed with China Eximbank in 2004. Dr. Corkin noted that the second, third and fourth MLFAs were treated more like ceiling increases to the initial facility. Therefore, for the time being, AidData categorizes the second, third, and fourth MLFAs as buyer's credit loans. Sinosure is also assumed to be involved in this loan facility as the 2003 framework agreement (中华人民共和国商务部与安哥拉共和国财政部关于两国经贸合作特殊安排的框架协议) specified that Sinosure will be signing relevant agreements with the Government of Angola, although the nature of the agreements is unclear.AidData considers this loan to be collateralized in a de facto sense. The cash desposited by the Angolan Ministry of Finance into a bank account controlled by China Eximbank is, for all intents and purposes, a source of collateral. This is true even if the lender does not have a formal security interest in the account.

Number of official sources

3

Number of unofficial sources

2