China Eximbank provides RMB 771.7 million government concessional loan for Phase 2 of Lae Tidal Basin Industrial Development Project

On July 7, 2016, the Chinese Government and the Government of Papua New Guinea signed a preferential loan framework agreement for Phase 2 of Lae Tidal Basin Industrial Development Project. Then, in March 2017, the China Eximbank and the Ministry of Treasury of the Government of Papua New Guinea signed an RMB 771,750,000 government concessional loan (GCL) agreement for Phase 2 of the Lae Tidal Basin Industrial Development Project. The GCL carried the following borrowing terms: a 20 year maturity and a 5 year grace period. It was scheduled for biannual repayments between March 2022 to March 2037. PNG’s Ministry of Treasury on-lent the proceeds of the GCL to Papua New Guinea Ports Ltd. (a state-owned enterprise). The purpose of the project was to construct a second berth — at least 240 meters in length — at the Port of Lae’s international container wharf and provide additional facilities for cargo storage behind the wharf. The Port of Lae is the largest and busiest port in PNG. China Harbour Engineering Co., Ltd. (CHEC) was the contractor responsible for implementation. This project was expected to reach completion in late 2019. However, in October 2020, PNG’s Minister for State Enterprises reported that Phase 2 was suspended due to technical concerns and questions about the quality of the work. As a result, the third phase of the project was brought forward. In September 2022 it was reported that SMEC (Australia) had taken the lead on Phase 2.

Additional details

This project is also known as Phase II of the Lae Tidal Basin West Side Industrial Development Project and the West Side of the Lae Tidal Basin and Huon Industrial Park Project. Phase 1 of the Lae Tidal Basin Industrial Development Project was financed by the Asian Development Bank and implemented by CHEC between June 18, 2012 and December 17, 2014. The China Eximbank loan that supported Phase 2 of the Lae Tidal Basin Industrial Development Project is identified as an active loan in the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020. AidData has status-coded the loan as suspended.

Number of official sources

11

Number of total sources

17