China Eximbank provides RMB 405 million government concessional loan for Belarusian Telecommunications Network (BeST) Construction and Equipment Supply Project (Linked to Record ID#42133)

Project narrative

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 borrowing 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 via Record ID#43258) and a buyer’s credit loan agreement worth $184.2 million (captured via Record 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). 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.