China Eximbank provides $41.265 million preferential buyer’s credit for 230 KV Transmission Lines and Substations for the Yeywa Hydropower Plant Project (Linked to Record ID#34205, 96221, 98029)

Project narrative

On September 2, 2005, China National Heavy Machinery Corporation (CHMC) and the Hydroelectric Power Department (HPD) of the Ministry of Electricity signed a $45.849 million commercial contract for the 230 KV Transmission Lines and Substations for the Yeywa Hydropower Plant Project. China Eximbank and the Government of Myanmar subsequently signed a $41.265 million preferential buyer’s credit (PBC) agreement for the 230 KV Transmission Lines and Substations for the Yeywa Hydropower Plant Project. The borrowing terms of the PBC are unknown. However, it is known that the borrower was to use the proceeds of the PBC to finance approximately 90% of the cost of the commercial contract. The primary purpose of the project was to construct a 110km, 230kV power transmission line from the Yeywa Hydropower Plant to the Meiktila substation and a a 50km, 230kV power transmission line from the Yeywa Hydropower Plant to the Bellin substation. Additional power lines were constructed through this project but their starting points and ending points are unknown. In total, the project involved the laying of 293 km of transmission lines. The project commenced on or around April 6, 2006, and it was completed on May 10, 2010. There are some indications that the China Eximbank loan for the 230 KV Transmission Lines and Substations for the Yeywa Hydropower Plant Project may have financially underperformed vis-a-vis the original expectations of the lender. In 2020, China Eximbank and the Government of Myanmar signed a debt suspension agreement as part of the G-20 Debt Service Suspension Initiative (DSSI). Under the terms of the agreement, the lender agreed to suspend principal and interest payments due between May 1, 2020 and December 31, 2020 under 3 buyer’s credit loan (BCL) agreements, 6 government concessional loan (GCL) agreements, and 27 preferential buyer’s credit (PBC) agreements (as captured via Record ID#98029). Debt service payments under many of these loan agreements were again deferred in 2021 (as captured via Record ID#96221).