China Eximbank provides RMB 622 million government concessional loan for Preah Vihear Province Reservoir Development Project

Project narrative

On December 13, 2018, China Eximbank and the Government of Cambodia signed an RMB 622 million preferential loan framework agreement for the Preah Vihear Province Reservoir Development Project. Then, on January 22, 2019, and China Eximbank and the Government of Cambodia signed an RMB 622 million government concessional loan (GCL) agreement for the Preah Vihear Province Reservoir Development Project. The borrowing terms of the GCL were as follows: a 1.25% interest rate, a 7-year grace period, and a 20-year maturity. The borrower was expected to use the proceeds of the GCL to finance a $97,978,000 commercial contract between Cambodia's Ministry of Water Resources and Meteorology and a consortium consisting of Guangdong Foreign Construction Co., Ltd. and Guangdong Yuantian Engineering Co., Ltd. According to the Government of Cambodia’s ODA Database, China Eximbank made three loan disbursements between 2019 and 2021: an RMB 124,400,000 loan disbursement in 2019, an RMB 248,800,000 loan disbursement in 2020, and an RMB 124,400,000 loan disbursement in 2021. The lender was originally scheduled to make an additional disbursement worth RMB 124,400,000 in 2022. The purpose of the project is to build a dam on the Sen River in northern Cambodia that flows through Preah Vihear and Kampong Thong provinces. More specifically, the scope of the project includes the construction of a concrete dam with a length of 50 meters, a width of 7 meters, a maximum height of 24.5 meters, and construction of a total of 03 sluice gates, with each sluice measuring 4 meters x 4 meters. The dam (left) is 998.6 meters long, 7 meters wide and 11 meters high. The reservoir capacity can maintain approximately 256. 9 million cubic meters of water and can supply approximately 143, 323 hectares of agricultural water in the wet season and 22,878 hectares in the dry season. In terms of benefits, with this large water storage capacity, the dam is expected to contribute significantly to flooding prevention and water supply in some areas downstream. According to the Preah Vihear provincial administration, the reservoir is located in Preah Vihear province, but most of the water flowing through this irrigation project will cover most areas in Kampong Thom province. In addition to serving agriculture and flooding disaster relief purposes, the dam will also be used for tourism purposes. Guangdong Foreign Construction Co., Ltd. and Guangdong Yuantian Engineering Co., Ltd. are the EPC contractors responsible for project implementation. Construction began on November 1, 2019. As of June 2020, the project had achieved a 41.5% completion rate. By December 2021, the project had achieved an 86% completion rate. The project was originally expected to reach completion by December 31, 2022. However, this date was eventually pushed back to December 17, 2024.