China Eximbank provides $75.685 million buyer's credit loan for Phase 1 of Malange Integrated Municipal Infrastructure Project (linked to #31742)
Constant 2017 USD
Funding agency [Type]
Export-Import Bank of China [State-owned Policy Bank]
Transport and storage (Code: 210)
Export Buyer's Credit
On 28 September, 2007, China Eximbank provided a $75,685,500 buyer's credit loan to the Government of Angola for Phase 1 of the Malange Integrated Municipal Infrastructure Project (See: UNCOVERING AGENCY: ANGOLA’S MANAGEMENT OF RELATIONS WITH CHINA, p. 293 and LINHA DE CRÉDITO COM O EXIMBANK DA CHINA RELATÓRIO DAS ACTIVIDADES DESENVOLVIDAS II TRIMESTRE DE 2008, p. 22). The project was financed through a China Eximbank $2 billion master loan facility agreement (MLFA) provided to the Government of Angola in September 2007, which carried a 7.008% interest rate, 5 year grace period, and 22 year maturity (see Project ID#31742). The proceeds of the loan were used to partially finance the cost of an $84,095,000 commercial contract with Sinohydro Engineering Bureau 4 Co., Ltd (See: UNCOVERING AGENCY: ANGOLA’S MANAGEMENT OF RELATIONS WITH CHINA, p. 292).The project involved the installation of a water supply pipe network, sewage pipe network, rainwater pipe network and pump station reservoir, earthwork engineering, road construction, maintenance engineering, and electrical engineering in Malanje Province. Construction commenced on 3 February, 2011 (See: Malanje Municipal Project (project under construction)).
This project is also known as Phase 1 of the Malanje Municipal Project or Phase 1 of the Malanje Comprehensive Infrastructure Construction Project.In the database of Chinese loan commitments that SAIS-CARI released in July 2020, it records the face value of the loan for this project (“Malange's Integrated Infrastructure; Phase I”) as $84 million; however, this value refers to the cost of the commercial contract rather than the loan that supported the commercial contract. AidData relies on the face value of the loan ($75.685 million) reported in Dr. Lucy Corkin’s book ('UNCOVERING AGENCY: ANGOLA’S MANAGEMENT OF RELATIONS WITH CHINA”), which is based on extensive fieldwork and interviews with Angolan Government officials.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
Number of unofficial sources
Receiving agencies [Type]
Government of Angola [Government Agency]
Implementing agencies [Type]
SinoHydro [State-owned Company]
Accountable agencies [Type]
Sonangol provided a source of collateral for the loan, and repayment is to be done with the proceeds of oil sales from Sonangol to UNIPEC (China international United Petroleum & Chemicals Co. Ltd, Sinopec group), which are to be deposited in the Angolan Ministry of Finances (MINFIN) account at China Eximbank (See: China’s Oil Diplomacy: Comparing Chinese Economic Statecraft in Angola and Brazil, p. 148). The volume of oil to be sold to UNIPEC each month for repayment of the loan, varies according to market oil prices. Under the agreement, 70% of works have to be contracted with Chinese companies and the same proportion of construction material, equipment and labour has to be contracted in China (See: China’s Oil Diplomacy: Comparing Chinese Economic Statecraft in Angola and Brazil, p. 149).