China Eximbank provides $24.5 million preferential buyer’s credit for Phase 3 of Agricultural Machinery Equipment Acquisition Project (Linked to Record ID#73192, #47040, #40435)

Project narrative

In 2018, China Eximbank and the Government of Mongolia signed a $24.5 million preferential buyer’s credit (PBC) agreement for Phase 3 of the Agricultural Machinery Equipment Acquisition Project. The PBC was approved under a $500 million line of credit for various projects that was signed by the two governments on June 16, 2011 (see Umbrella Record ID#40435). The borrowing terms of the PBC were as follows: a 20-year maturity, a 7-year grace period, and a 2% interest rate. The proceeds of the PBC were to be used by the borrower to partially finance a purchase contract with Lovol Heavy Industry Co., Ltd. The purpose of the project was to facilitate the acquisition of agricultural machinery and equipment. The project was completed on May 23, 2019 when 797 sets of large tractors and combine harvesters were successfully delivered (including 180 tractors with 50-165 horsepower and haymaking equipment). Upon completion, the project was expected increase the technical capacity of the agricultural labor force by 10 percent, prepare 100,000 tons of hay and fodder, 10,000 tons of fodder per year, irrigate 9,200 hectares of crops, irrigate 450 hectares of potatoes and vegetables, and irrigate 240 hectares of fruits and vegetables.