Project ID: 38255

China Eximbank provides $116.6 million preferential buyer's credit loan for Phase 2 of Angat Water Utilisation and Aqueduct Improvement Project

Commitment amount

$ 162391960.71384162

Adjusted commitment amount

$ 162391960.71

Constant 2021 USD

Summary

Funding agency [Type]

Export-Import Bank of China (China Eximbank) [State-owned Policy Bank]

Recipient

Philippines

Sector

Water supply and sanitation (Code: 140)

Flow type

Loan

Level of public liability

Central government debt

Infrastructure

Yes

Category

Intent

Mixed (The next section lists the possible statuses.)

Commercial

Development

Representational

Mixed

Financial Flow Classification

OOF-like (The next section lists the possible statuses.)

Official Development Assistance

Other Official Flows

Vague (Official Finance)

Flows categorized based on OECD-DAC guidelines

Project lifecycle

Status

Completion (The next section lists the possible statuses.)

Pledge

Commitment

Implementation

Completion

Suspended

Cancelled

Milestones

Commitment

2010-01-07

Planned start

2010-01-07

Actual start

2010-03-17

Planned complete

2013-03-16

Actual complete

2012-07-17

NOTE: Red circles denote delays between planned and actual dates

Geography

Description

On January 7, 2010, China Eximbank and the Metropolitan Waterworks and Sewerage System (MWSS) — a government agency that is in charge of water privatization in Metro Manila in the Philippines — signed a $116.6 million preferential buyer's credit (PBC) agreement for Phase 2 of the Angat Water Utilisation and Aqueduct Improvement Project (AWUIAP). The estimated borrowing terms of the PBC are as follows: 20 year maturity, 5 year grace period, and 3% interest rate. The final maturity date of the PBC is January 21, 2030. Semi-annual loan repayments were scheduled to begin on January 21, 2015 and end on January 21, 2030. The loan entered into force on May 7, 2010. The proceeds of the PBC were to be used by the borrower to finance 95% of the cost of a commercial contract between MWSSS and China International Water and Electric Company (CWE), which was signed in mid-2009. The purpose of the project was to transport raw water from Angat Dam to the La Mesa Dam and then onward to a set of water treatment plants in La Mesa and Balara (by repairing a leaky, 15 km irrigation canal called Aqueduct No 5). Upon completion of the project, it was expected that Rizal, Cavite, and Bulacan provinces in Quezon City would have greater access to clean water and MWSS would recover an estimated 394 million liters of water that was being lost each day because of the leaky aqueduct. CWE received a construction start order from MWSS on March 16, 2010. Construction commenced on March 17, 2010. The EPC contract went into effect on May 9, 2010. A formal groundbreaking ceremony took place on July 28, 2010. The project was originally scheduled to be completed in March 2013 but it was completed eight months ahead of schedule and officially inaugurated on July 17, 2012. The project was issued a temporary completion certificate on September 10, 2012. A final project completion certificate was issued on September 25, 2013. However, this project was also a source of local controversy. In February 2011, the Philippine Large Diameter Pressure Pipe Manufacturers Association urged the new MWSS board members appointed by President Aquino to rescind the commercial contract that was issued to CWE. It alleged that limiting the bidding among three Chinese state-owned firms violated the country’s procurement law. The Philippine Large Diameter Pressure Pipe Manufacturers Association also said the contract price was excessive compared to the cost of the Phase 1 of the Angat Water Utilisation and Aqueduct Improvement Project, which was carried out by three of its members. The MWSS board, however, did not act on the association’s recommendation to rescind the contract.

Additional details

1. The Chinese project title is Angat供水与管道改造二期工程 or 安嘎特供水项目 or 菲律宾大马尼拉供水项目. 2. The Government of Philippines loan identification number for the China Eximbank PBC that supported Phase 2 of the Angat Water Utilisation and Aqueduct Improvement Project is CHI-7. 3. The China Eximbank loan that supported this project is not included in the the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020. 4. According to CWE, it was issued a $112 million commercial contract and the China Eximbank PBC was used to finance 95% of the cost of the commercial contract. However, the Government of the Philippines reports that the face value of the PBC was $116.6 million. This issue requires further investigation.

Number of official sources

23

Number of total sources

32

Download the dataset

Details

Cofinanced

No

Direct receiving agencies [Type]

Philippines Metropolitan Waterworks and Sewerage System (MWSS) [Government Agency]

Implementing agencies [Type]

China International Water and Electrical Corporation (CWE) [State-owned Company]

Loan Details

Maturity

20 years

Interest rate

3.0%

Grace period

5 years

Grant element (OECD Grant-Equiv)

31.0702%

Bilateral loan

Export buyer's credit

Investment project loan

Preferential Buyer's Credit