China Eximbank provides a $80.1 million preferential buyer’s credit for Railcar Acquisition Project

Project narrative

On October 22, 2009, the Export-Import Bank of China and the Société Nationale des Chemins de Fer Tunisiens (SNCFT) — a state-owned railway operator in Tunisia — signed a $80,148,694.70 preferential buyer's credit (PBC) loan agreement for the Railcar Acquisition Project. The borrowing terms of the loan are unknown. The Tunisian Chamber of Deputies ratified the loan agreement and approved the issuance of a sovereign guarantee from the Government of Tunisia in support of the loan on January 12, 2010. President of Tunisia Zine El Abidine Ben Ali then approved the law and the sovereign guarantee on January 20, 2010 via Law n ° 2010-1. The proceeds of the loan were to be used by the borrower to partially finance a $93.66 million USD commercial contract with China South Locomotive & Rolling Stock Corp., Ltd, a subsidiary of the state-owned CSR Group, which was signed on March 30, 2009, for the provision of electric units (EMUs). It also included the commissioning of the railcars and the training of Tunisian technicians on the maintenance of the railcars. CRS Nanjing Puzhen Co., Ltd. was the specific company responsible for construction of the railcars. Voith Turbo (a division of the Voith Group) supplied 42 RailPacks with T212bre turbo transmission, SK/KE 485 final drives, roof-mounted cooling systems and cardan shafts, and Schaku couplers for the project to act as emergency replacements. The purpose of the project was to acquire 20 railcars. 12 of these railcars were designed to serve the Tunis-Beja, Jendouba-Ghardimaou, and Tunis-Bizerte railway lines. The other 8 railcars were design to serve the Tunis-Gafsa, Gabes-Tunis, Tunis-Mahdia, and Tunis-Kalaa Khasba railway lines. The new railcars had a speed of 160 km/h, which would greatly reduce travel times. The acquisition of new railcars was part of the renewal of the Tunisia's national rail transportation, which sought to modernize Tunisia's old train fleet. The first railcar was shipped to Tunisia in February 2012. 6 of the railcars were originally scheduled to arrive in Tunisia on July 5, 2012; two railcars had already been delivered and were already in use in Tunisia at that time. The railcars were officially put into commercial operation in a ceremony held on December 17, 2012. Then, in August 2017, the CEO of SNCFT, Sarra Rejeb, announced that she suspected mismanagement within the company and called for an investigation into the purchase of the 20 railcars. She argued that it was an unsuccessful deal, since the railcars' quality was "mediocre" and 12 of them had been damaged and rendered non-functional.