China Eximbank provides $46 million preferential buyer's credit for Thanh Hoa Steel Billet Factory Construction Project

On October 22, 2008, China Eximbank and the Government of Vietnam signed a preferential buyer’s credit (PBC) framework agreement (see Vietnam Ministry of Finance article). Then, on December 21, 2011, China Eximbank and the Vietnam Ministry of Finance signed a $46 million PBC agreement for the Thanh Hoa Steel Billet Factory Construction Project (see NGO Centre article). The loan terms are unknown. This was one of the several agreements signed during Chinese President Xi Jinping's three-day visit (December 20-22, 2011) to Vietnam. The proceeds of the PBC were supposed to be on-lent to Thanh Hoa Construction and Smelting Corporation (Tổng công ty Xây dựng và luyện kim Thanh Hoá) which would then patrially finance a commercial contract with an unspecified Chinese contractor. The purpose of the project was to construct a steel billet factory in Cao Ngoc commune, Ngoc Lac district, and Thanh Hóa Province with the capacity to produce 250,000 tons of steel per year. This project encountered significant implementation problems. As of June 2013, the project was being rescoped and the Ministry of Finance of Vietnam was considering a different Chinese contractor.

Additional details

This project is also known as the Cao Ngoc Steel Billet Factory Construction Project. The Chinese project title is 于越南清化钢铁厂项目. The Vietnamese project title is Thép Thanh Hóa or máy nhà máy sản xuất phôi thép tại tỉnh Thanh Hoá với công suất 250.000 tấn/năm or án Nhà máy thép Cao Ngọc or Nhà máy sản xuất phôi thép, công suất 250.000 tấn/năm tại xã Cao Ngọc, huyện Ngọc Lặc or Nhà máy phôi thép Thái Bình Dương. The China Eximbank loan that supported this project is not included in the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020.

Number of official sources

4

Number of unofficial sources

9