ICBC and four other Chinese banks pledge $297.5 million syndicated loan for Regional University Extension and Rehabilitation Project (Linked to Project ID#65113, #64352, #86358)

In 2019, the Industrial and Commercial Bank of China (ICBC), China Eximbank and three other Chinese banks signed a $297.5 million syndicated loan framework agreement with the Government of Guinea for the Regional University Extension and Rehabilitation Project. If approved, this loan would be issued as a $297.5 million subsidiary loan under the $20 billion Resource and Loan Cooperation Framework Agreement that the Chinese Government and the Republic of Guinea signed on September 5, 2017 (see Project ID #65113 and #64352). As such, it carries the following borrowing terms: 15-year maturity. 4-year grace period and a 2.234% interest rate (6-month Euribor plus a 2.5% margin). The borrower would be expected to use the loan proceeds to finance 85% of a $350 million commercial contract with China Bengbu International Technology and Economic Cooperation (CBITEC), which was signed on October 18, 2016. The project involves the rehabilitation and extension of regional universities in Conakry-Sonfonia, Labé, Kankan, and N'zérékoré. CBITEC is the contractor responsible for project implementation. A foundation-laying ceremony for the construction of the regional university in Kankan, which is located between the villages of Bingo and Saramaya Villages on the Kankan-Gbérédou-Baranama road), took place on November 23, 2019. According to the commercial contract, the project was originally expected to reach completion within two years (November 23, 2021). However, as of December 2022, there was little evidence of project implementation. Then, in January 2023, the Government of Guinea dispatched an official delegation to China to discuss potential financing for four different projects under 'Phase 2' of the $20 billion Resource and Loan Cooperation Framework Agreement that the Chinese Government and the Republic of Guinea signed on September 5, 2017. One of the projects under discussion was the Regional University Extension and Rehabilitation Project (known in French as the 'Projet de construction de quatre universités').

Additional details

1. The French project title is Réhabilitation des Universités de Sonfonia, Labé, Kankan et N'zérékoré or Projet de conception de bâtiments universitaires en Guinée. The Chinese project title is 几内亚康康大学新校园项目 or 康康大学改扩建项目 or Sonfonia索福尼亚大学, Labé拉贝大学, Kankan康康大学, N'Zérékoré恩泽雷科雷大学 or 科纳克里索福尼亚大学UGLC-Sonfonia, 拉贝大学Université de Labé, 康康大学 UJN-Kankan, 恩泽雷科雷大学 l’Université de N’Zérékoré. 2. To estimate the face value of the loan (i.e. the transaction/commitment amount), AidData calculated 85% of the total value of the commercial contract with CBITEC ($350,000,000 x 0.85 = $297,500,000). 3. The World Bank’s Debtor Reporting System (DRS) does not record any official sector Chinese loan commitments to the Government of Guinea (and/or entities backed by Government of Guinea repayment guarantees) in 2019 or 2020. The DRS indicates that official sector loan commitments from China to the Government of Guinea (and/or entities backed by Government of Guinea repayment guarantees) in 2018 amounted to $1,783,868.027. This amount is roughly equivalent to the sum of the $1,175,468,700 loan that China Eximbank issued for the 450MW Souapiti Hydroelectric Power Plant Construction Project (captured via Project ID#187) in 2018 and the EUR 559,471,286 ($598 million) loan that ICBC and China Eximbank issued for the Conakry Urban Road Project and the Reconstruction of the RN1 Coyah-Mamou-Dabola Project (captured via Project ID#65115 and ID#65116) in 2018. Consequently, AidData assumes for the time being that a loan agreement for the Regional University Extension and Rehabilitation Project was never finalized after the syndicated loan framework agreement was signed. 2. Some sources suggest that a loan with ICBC for the Rehabilitation and extension project of the University of Sonfonia (Projet de rehabilitation et d'extension de l'Universite de Sonfonia) may have already been finalized (https://www.milbank.com/en/professionals/shepard-liu.html and https://www.milbank.com/print/v2/content/563/shepard-liu.pdf). This issue warrants further investigation.

Number of official sources

11

Number of total sources

19