Narrative
Full Description
Project narrative
On November 10, 2015, China Eximbank and the Government of Mongolia signed a general loan agreement regarding the utilization of a $1 billion preferential buyer's credit (PBC) for various projects (as captured via Umbrella Record ID#49148). Under the terms of the general loan agreement, all subsidiary (individual) loan agreements for specific projects carry identical borrowing terms: a 20-year maturity, a 7-year grace period, a 2% interest rate, a 0% default (penalty) interest rate, a 0% management fee, and a 0.25% commitment fee. Then, on November 28, 2022, China Eximbank and the Government of Mongolia signed a $29,393,000 subsidiary loan (PBC) agreement [CHINA EXIMBANK PBC NO. (2022) 17 TOTAL NO. (566)] for the Ulaanbaatar Railway Underpass Design and Construction Project. The borrower was expected to use the proceeds of the loan to finance 95% of the cost of a $30,940,000 EPC (commercial) contract [MoF20211217001-01] between the Capital City Governor's Office, the Ministry of Finance of Mongolia, and a consortium consisting of China Tiesiju Civil Engineering Group Co., Ltd, China Railway International Group Co., Ltd, and China Machinery Industry Construction Group Inc. which was signed on September 30, 2022. The purpose of this project is to reduce traffic congestion by constructing four cross-railway underpasses — located to the right side of the Tavan Shar railway crossing in Songinokhairkhan District; the Central Geological Laboratory railway intersection in Songinohairkhan district; the railway in front of Hermes center within Bayangol district; and the intersection between Narnii Road and Ikh Toiruu Street — and associated ancillary facilities in the capital city of Ulaanbaatar. The underpasses will go underneath the China-Mongolia-Russia trans-continent railway. China Tiesiju Civil Engineering Group Co., Ltd, China Railway 4th Bureau Co., Ltd, China Railway International Group Co., Ltd, and China Machinery Industry Construction Group Inc. are the contractors responsible for project design and implementation. A design competition for the various underpasses was organized in December 2019. After receiving feedback from citizens, the Government of Mongolia’s Department of Urban Development and Development announced that it would make final decisions about the locations of the underpasses and pedestrian bridges. Project design work was originally expected to reach completion by May 2023. On March 30, 2023, the Government of Mongolia met its 5% counterpart financing commitment under the PBC agreement by making a $464,1000 payment to China Tiesiju Civil Engineering Group Co., Ltd. Then, on July 5, 2023, construction began.
Staff comments
1. This project is also known as the Ulaanbaatar Underground Crossover Project, the Ulaanbaatar Pedestrian Bridge Project, the Tunnel Project, and the Detailed Design and Construction of the Railway Underpass Project in Ulaanbaatar City. The Mongolian project title is Нүхэн гарц төсөл or Дэд бүтэц төсөл - Нүхэн гарц төсөл. The Chinese project title is 地下人行通道项目 or 蒙古乌兰巴托跨铁路地下通道项目. 2. The China Eximbank loan for this project is not included in the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020. 3. The November 28, 2022 PBC (loan) agreement can be accessed in its entirety via https://www.dropbox.com/s/osbhxycf1yt8l7p/Mongolia%202022%20China%20Eximbank%20Loan%20Agreement%20for%20Detailed%20Design%20and%20Construction%20of%20the%20Railway%20Underpass%20Project%20in%20Ulaanbaatar%20City%20Project.pdf?dl=0. 4. The September 30, 2022 commercial contract can be accessed in its entirety via https://www.dropbox.com/s/y0g9rdwcg3w6du0/Mongolia%202022%20China%20Eximbank%20Loan%20Agreement%20for%20Detailed%20Design%20and%20Construction%20of%20the%20Railway%20Underpass%20Project%20in%20Ulaanbaatar%20City%20Project%20--%20Underlying%20Commercial%20Contract.pdf?dl=0. 5. The November 10, 2015 general loan agreement can be accessed in its entirety via https://www.dropbox.com/scl/fi/6517ecol3fwzuqo536c54/Government-of-Mongolia-and-China-Eximbank-General-Loan-Agreement-November-2015.pdf?rlkey=9r8cibj3kt0v3d891n6hy33rb&dl=0. A May 4, 2017 amendment to the November 10, 2015 general loan agreement can be accessed in its entirety via https://www.dropbox.com/scl/fi/1055dq0pvwpxm45fk2fmk/Government-of-Mongolia-and-China-Eximbank-General-Loan-Agreement-2015_May_4_2017_Amendment-1.pdf?rlkey=hbj7c8wgm6udzr0icw8tufnwa&dl=0.