China Eximbank provides $129.9 million buyer’s credit loan for Phase 1 (Part 2) of Myanmar Communication Infrastructure Construction Project (Linked to Record ID#64443 and #63665)

Project narrative

On December 15, 2015, the Zhejiang Branch of China Eximbank and Myanmar Fiber Optic Communication Network Co., Ltd. (MFOCN or 缅甸光纤通信网络有限公司) — a project company and subsidiary of HyalRoute Communication Group Ltd. (HyalRoute) — signed a $130 million buyer’s credit loan agreement for Phase 1 (Part 2) of the Myanmar Communication Infrastructure Construction Project. The borrowing terms of the loan are unknown. However, it is known that the borrower was to use the proceeds of the loan to finance an EPC contract with PowerChina Huadong Engineering Cooperation Ltd. (HDEC), which was signed on February 8, 2015. MFOCN secured a corporate guarantee from HyalRoute Communication Group Limited for the loan from China Eximbank and purchased buyer’s credit insurance from Sinosure. It also pledged fiber optic network assets as sources of collateral. In July 2015, an Initial Environmental Examination was conducted for the project and determined only an Environmental Management Plan would be necessary. In addition an Environment, Health and Security Management System was developed by HyalRoute. The purpose of the Myanmar Communications Infrastructure Construction Project is to install a 62,000 km national fiber optic cable (FOC) network and 1,000 telecom towers over 3 phases. Phase 1 involved the construction of 17,401 km of the FOC backbone. Part 2 of Phase 1 involved the laying of 4,351 km of fiber optic cable and 192 telecom towers to support the Yangon-Nebido-Mandalay FOC backbone. HDEC was the general EPC contractor responsible for implementation of the project. However, Futong Group Co., Ltd. also supplied fiber optic cable as a subcontractor. Phase 1 (Part 2) was ultimately completed on March 20, 2016. Parts 1 and 2 of Phase 2 of the project are recorded via Record ID#64443 and #63665).