China Eximbank provides $184.2 million buyer’s credit loan for Belarusian Telecommunications Network (BeST) Construction and Equipment Supply Project (Linked to Project ID#43258)

On December 5, 2005, the People’s Republic of China and the Government of Belarus signed a loan framework agreement, which specified that China Eximbank intended to issue an RMB 405,000,000 government concessional loan (BCL) to the Government of Belarus for the Belarusian Telecommunications Network (BEST) Construction and Equipment Supply Project. The loan would carry the following terms: a 9-year maturity and a 2.5% interest rate. Later that month, China Eximbank reportedly signed a GCL agreement worth RMB 405 million (captured in Project ID#43258) and a buyer’s credit loan agreement worth $184.2 million (captured in Project ID#42133) for the Belarusian Telecommunications Network (BEST) Construction and Equipment Supply Project. Both of these loans reportedly carried 9-year maturities (from 2006 to 2014) and 3-year grace periods (from 2006 to 2008). Government of Belarus provided guarantee for the credit. Belarus’ Ministry of Finance evidently on-lent the proceeds from the GCL and buyer’s credit loan to a newly-established state-owned company called CJSC Belarusian Telecommunications Network (BeST). BeST, in turn, used the proceeds from the GCL and the buyer’s credit loan to finance a $234 million commercial contract that it signed with Alcatel Shanghai Bell Company Limited (a Chinese subsidiary of Alcatel, a French telecommunications and engineering company) in the fall of 2005. The purpose of this project was to build a cellular (GSM) communication network and facilitate the acquisition of telecommunication equipment from Alcatel Shanghai Bell Company Limited. As of November 15, 2007, China Eximbank had disbursed $170 million in support of the implementation of this project. According to the Council of Ministers of Belarus, the project was ultimately completed in 2008.

Additional details

1. The Russian project title is Создание оператора мобильной связи «Бест» or проекта телекоммуникационной сети (GSM) для компании "BeST". 2. This loan is not included in the Overseas Development Finance Dataset published by Boston University’s Global Development Policy Center in December 2020. 3. For the time being, AidData assumes that the GCL and buyer’s credit loan maturities and grace periods are identical (since the General Director of BeST, Mikhail Demchenko, announced on November 15, 2007 that his company was responsible for repaying China Eximbank and repayments would begin in 2009 and end in 2014).

Number of official sources

6

Number of total sources

14