China Eximbank provides $360 million preferential buyer’s credit for 150MW Zongo II Hydroelectric Dam Construction and a 220 kV Transmission Line Project (Linked to Project ID#59085)

On January 29, 2011, China Eximbank and the Government of the Democratic Republic of Congo signed a $360 million preferential buyer’s credit (PBC) agreement [CHINA EXIMBANK PBC NO (2011) TOTAL NO 153] for the 150MW Zongo II Hydroelectric Dam Construction and a 220 kV Transmission Line Project. The loan carried the following borrowing terms: a 20 year maturity, an 8 year grace period, a 2% interest rate, and 0.75% commitment fee. According to Government of the DRC's Aid Management Platform (AMP), the loan had disbursed $91,046,040.07 as of July 2019. The loan's (principal) amount outstanding was $360,000,000 in 2021 and 2022. The project involved the construction of the Zongo II hydroelectric dam and the construction of a 220 kV transmission line from the dam to Kinsuka. The dam was expected to produce 150 megawatts per annum and create 2,000 jobs during its three-year construction phase. Sinohydro and Societe Nationale d'Electricite (SNEL) were jointly responsible for project implementation. Construction began on May 16, 2012 and the project was officially completed on June 22, 2018. There were additional materials supplied during 2020, including 220kV transmission line towers, insulators, ground conductors, optical cables and fittings. There are indications that this China Eximbank loan has financially underperformed vis-a-vis the original expectations of the lender. The loan was originally expected to enter its principal repayment period in 2019. However, records from the Public Debt Directorate of the DRC's Ministry of Finance demonstrate that no principal payments were made in 2019, 2020, 2021, or 2022. This pattern implies that the borrower has accumulated principal arrears.

Additional details

1. This project is also known as Central Zongo II Dam, 150MW Zongo II Hydropower Station Project, and Phase 2 of the Zongo Hydroelectric Dam Project. The Chinese project title is ZONGO Ⅱ水电站实 or 宗果水电站二期 or 宗戈水电站二期 or 宗果水电站二期项目. The French project title is Construction du Barrage Zongo or Construction de la centrale hydroélectrique de ZONGO é et des Réseaux Associés. 2. China Eximbank also provided a $298.88 million preferential buyer’s credit in 2018 for the Kinsuka 220KV Substation and Associated Distribution Networks Project (as captured via Project ID#59085). The purpose of this project is to evacuate power from the Zongo II hydroelectric dam.

Number of official sources

26

Number of total sources

55