Overview

China Development Bank provides $700 million loan in 2016 to shore up Pakistan’s foreign exchange reserves

Commitments (Constant USD, 2023)$763,505,101

Commitment Year•2016Country of Activity•PakistanDirect Recipient Country of Incorporation•PakistanSector•General Budget SupportFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date: Sep 20, 2016

End (actual): Sep 20, 2019

First repayment (originally scheduled): Sep 20, 2019

Last repayment (originally scheduled): Sep 20, 2019

Geospatial footprint

Map overview

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China Development Bank provided a loan to shore up Pakistan’s foreign exchange reserves. More detailed locational information can be found at: https://www.openstreetmap.org/way/758630714

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Policy Banks

China Development Bank (CDB)

Receiving agencies

Government Agencies

State Bank of Pakistan (SBP)

Implementing agencies

Government Agencies

State Bank of Pakistan (SBP)

Loan desecription

China Development Bank provides $700 million loan in 2016 to shore up Pakistan’s foreign exchange reserves

Grace period•3 yearsGrant element•13.9666%Interest rate (t₀)•4.27939%Interest type•Variable Interest RateLoan tenor•6-month rateMaturity•3 years

Narrative

Full Description

Project narrative

On September 20, 2016, China Development Bank and the State Bank of Pakistan signed a $700 million short-term loan agreement to prevent a balance of payments crisis. The loan carried the following borrowing terms: a 3 year maturity, a 3 year grace period, and an interest rate of 6-month LIBOR plus a 3.02% margin. It fully disbursed.

Staff comments

1. In its 2016-2017 Yearbook, the Economic Affairs Division (EAD) of the Government of Pakistan identified total loan commitments from CDB as $1.7 billion. This aggregate figure refers to the $700 million CDB loan issued in 2016 (captured via Record ID#50483) and the $1 billion CDB loan issued in 2017 (captured via Record ID#54158). 2. The all-in interest rate was calculated by adding 3.02% to the 6-month LIBOR rate in September 2016 (1.058%).