China Eximbank and China Construction Bank provide export seller's credit for Yeni Pulp & Paper Mill Project

On December 12, 2001, China Eximbank and China Construction Bank Corporation (Chengdu Branch) reportedly issued an export seller’s credit to China Chengda Engineering Co. Ltd. for the Yeni Pulp & Paper Mill Project (See: p. 226 of 'Modern China-Myanmar Relations Dilemma of Mutual Dependence'). The borrowing terms are unknown. However, it is known that Sinosure provided credit insurance. The proceeds from the export seller’s credit were used to partially finance an $81.5 million commercial contract with the Government of Myanmar. The purpose of the project was to construct a pulp and paper mill — with the capacity to produce 50 tons of newspaper pulp and 80 tons of packing paper per day — in the village of Yeni (ရေနီ) within Yedashe Township, Taungoo District, and Bago Division. China Chengda Engineering Co. Ltd. was the EPC contractor responsible for implementation. The project officially commenced in April 21, 2006 and it was officially completed on May 26, 2009. The Chinese project title is 缅甸耶尼制浆造纸项目 or 缅甸耶尼造纸厂.

Additional details

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. The face value of the export seller’s credit (i.e. the transaction amount) is unknown. For the time being, AidData has recorded the face value of the export seller’s credit as 85% of $81.5 million, given China Eximbank’s policy that an export credit can be used to finance up to 85% of the cost of a commercial contract. China Chengda Engineering Co. Ltd. may have used the proceeds from the export seller’s credit that it secured to on-lend to the Government of Myanmar. However, this issue requires further investigation.

Number of official sources

7

Number of unofficial sources

8