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Overview

China Construction Bank contributes to ZAR 3 billion syndicated loan agreement with Transnet to support the manufacturing of locomotives for its freight rail business

Commitments (Constant USD, 2023)$94,536,632
Commitment Year•2014Country of Activity•South AfricaDirect Recipient Country of Incorporation•South AfricaSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Implementation

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Mar 1, 2014
Last repayment (originally scheduled)
Feb 28, 2019

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 Commercial Banks

  • China Construction Bank Corporation (CCB)

Cofinancing agencies

Private Sector

  • Rand Merchant Bank (RMB)

State-owned Banks

  • KfW IPEX-Bank GmbH

Receiving agencies

State-owned companies

  • Transnet SOC Ltd

Implementing agencies

Private Sector

  • General Electric Co. (GE)

State-owned companies

  • China CNR Corporation
  • CSR Zhuzhou Electric Locomotive Co., Ltd

Loan desecription

In 2014, China Construction Bank contributes to ZAR 3 billion syndicated loan agreement with Transnet to support the manufacturing of locomotives for its freight rail business

Interest type•UnknownMaturity•5 years

Narrative

Full Description

Project narrative

In March 2014, Transnet signed a ZAR 3 billion syndicated loan agreement with KFW IPEX-Bank GmbH, Rand Merchant Bank, and the China Construction Bank (CCB). The loan carried a 5-year maturity. Its other borrowing terms are unknown. The borrower was expected to use the proceeds of the loan to support the manufacturing of locomotives for its freight rail business. More specifically, the borrower was expected to use the loan proceeds to finance contracts that Transnet awarded to (a) CSR Zhuzhou Electric Locomotive and Bombardier Transportation SA to supply 599 electric locomotives and (b) General Electric South Africa Technologies and CNR Rolling Stock South Africa to build and supply 465 diesel locomotives. All the locomotives except 70 were expected to be built at Transnet Engineering's plants in Koedoespoort in Pretoria and Durban, to drive the country's regional integration objectives. The loan's (principal) amount outstanding was ZAR 2,117,000,000 in 2014, ZAR 644,000,000 in 2015, ZAR 621,000,000 in 2016, ZAR 358,000,000 in 2017, ZAR 181,000,000 in 2018, ZAR 0 in 2019, and ZAR 1,600,000,000 in 2020.

Staff comments

1. The size of China Construction Bank's financial contribution to the ZAR 3 billion syndicated loan is unknown. For the time being, AidData assumes equal contributions (ZAR 1 billion) across the three known members of the syndicate. This issue warrants further investigation. 2. This loan was not included in the database of Chinese loan commitments that SAIS-CARI released in 2020 and re-released in 2021. Nor was it included it in the Chinese Loans to Africa (CLA) Database — that is maintained by Boston University's Global Development Policy Center — as of September 2024. 3. Transnet Engineering is the company's engineering, manufacturing and rolling stock maintenance division.