China Eximbank provides RMB 481 million government concessional loan for 1,000 Unit Housing Development Project in Hulhumalé (Linked to Record ID#95441, 95443)

Project narrative

On November 11, 2010, China Eximbank and the Government of Maldives signed an RMB 481 million government concessional loan (GCL) agreement for the 1,000 Unit Housing Development Project in Hulhumalé. The borrowing terms of the GCL, which went into effect on November 11, 2011, included a 2% interest rate. a 20 year maturity, and a 5 year grace period. The borrower was expected to use the loan proceeds to finance a $76 million commercial contract between the Ministry of Housing, Transportation, and Environment of Maldives and China Machinery Engineering Corporation (CMEC), which was signed on March 21, 2011. China Eximbank made disbursements worth MVR 471,937,626 in 2011 and MVR 93,678,432 in 2012. The borrower made loan repayments to China Eximbank worth RMB 16,033,333 during calendar year 2020, RMB 32,066,667 during calendar year 2022, and RMB 32,066,667 during calendar year 2023. It made no loan repayments to China Eximbank during calendar year 2021. The loan’s amount outstanding was RMB 352,733,333 as of December 31, 2019, RMB 320,666,666 as of December 31, 2020, RMB 288,600,000 as of December 31, 2021, RMB 256,533,332 as of December 31, 2022, and RMB 224,466,666 as of December 31, 2023. The project involved the construction of 56 four-story buildings built on 39,600 square meters in Hulhumalé. The buildings were intended to reduce housing pressure in the nearby capital. The project also served as Phase 1 of a larger 4,000-unit housing project in the Maldives. CMEC was the contractor responsible for project implementation. Construction began in September 2010. However, a formal groundbreaking ceremony took place on November 1, 2011. Nearly a year later, the project passed an on-site inspection on November 11, 2012. The project was officially handed over to the local authorities on December 27, 2012. It was completed ahead of schedule. It was originally expected to reach completion in June 2013. The first resident moved in on July 29, 2013. There are some indications that the China Eximbank loan for the 1,000 Unit Housing Development Project in Hulhumalé has financially underperformed vis-a-vis the original expectations of the lender. In May 2020, the China Eximbank government concessional loans for the 1,000 Unit Housing Development Project in Hulhumalé (captured via Record ID#34996), Phase 2 of the 1,500 Housing Units Development Project (captured via Record ID#35020), and the China-Maldives Friendship Bridge Construction Project (captured via Record ID#38037) were restructured through the G-20 Debt Service Suspension Initiative (DSSI). Debt service payments under the three loans were deferred until December 31, 2020 and the outstanding balances of the loans were transferred to a new China Eximbank loan instrument along with the capitalization of accrued interest. Debt service payments under the three loans were again deferred from January 1, 2021 to June 30, 2021 and the outstanding balances of the loans were again transferred to a second, new China Eximbank loan instrument along with the capitalization of accrued interest. Debt service payments were deferred yet again under the three loans from July 1, 2021 to December 31, 2021 and the outstanding balances of the loans was again transferred to a third, new China Eximbank loan instrument along with the capitalization of accrued interest. As of December 31, 2021, the amount outstanding under the first, new China Eximbank loan instrument was RMB 69,163,650. As of December 31, 2021, the amount outstanding under the second, new China Eximbank loan instrument was RMB 68,467,299. As of December 31, 2021, the amount outstanding under the third, new China Eximbank loan instrument was RMB 83,443,100.