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Overview

[China Co-Financing Fund] IDB administers 50 million USD loan from CHC to BDMG for Municipal Infrastructure and Services Financing Partnership

Commitments (Constant USD, 2023)$51,277,659
Commitment Year•2014Country of Activity•BrazilDirect Recipient Country of Incorporation•BrazilSector•Other MultisectorFlow Type•Loan

Status

Project lifecycle

Implementation

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jun 13, 2014
Start (actual)
Aug 4, 2014
Last repayment
Dec 30, 2020

Geospatial footprint

Map overview

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IDB administered a loan from CHC to BDMG for Municipal Infrastructure and Services Financing Partnership with the purposes of supporting various lending towards projects in the State of Minas Gerais, Brazil. More detailed locational information can be found at: https://www.openstreetmap.org/relation/315173

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

Government Agencies

  • People's Bank of China (PBC)

Cofinancing agencies

Intergovernmental Organizations

  • Inter-American Development Bank

Receiving agencies

State-owned companies

  • Minas Gerais Development Bank (Banco de Desenvolvimento de Minas Gerais, BDMG)

Implementing agencies

Intergovernmental Organizations

  • China Co-Financing Fund for Latin America and the Caribbean (CHC)

State-owned companies

  • Minas Gerais Development Bank (Banco de Desenvolvimento de Minas Gerais, BDMG)

Loan desecription

[China Co-Financing Fund] IDB administers 50 million USD loan from CHC to BDMG for Municipal Infrastructure and Services Financing Partnership

Grant element•19.7564%Interest rate (t₀)•2.5755%Interest type•Variable Interest RateMaturity•7 years

Narrative

Full Description

Project narrative

On 13 June 2014, the Inter-American Development Bank (IDB) signed a loan contract with Banco de Desenvolvimento de Minas Gerais (BDMG) for a Municipal Infrastructure and Services Financing Partnership, through which IDB would provide three tranches of financing from its ordinary capital and the China Co-Financing Fund (CHC), which is a trust fund fully financed by a contribution from the People's Bank of China. The three loan tranches from IDB's ordinary capital total 100 million USD (Loan 3184A/OC-BR-1, Loan 3184A/OC-BR-2, Loan 3184A/OC-BR-3), and the three loan tranches from CHC total 50 million USD (Loan 3184/CH-BR-1, Loan 3184/CH-BR-2, Loan 3184/CH-BR-3). The IDB approval date for this loan financing was 4 June 2014, and it refers to this project as "BR-L1403 : BDMG Municipal Infrastructure and Services Financing Partnership". According to BDMG's financial statements, each tranche would have an interest rate of 2.25% plus a 6-Month LIBOR, which would be determined on a semi-annual basis depending on when the disbursement of each tranche was requested. This composition was also subject to change based on contracts signed for the disbursement of each tranche. The first 50 million USD tranche was disbursed on 4 August 2014 with a 7 year maturity. For the purposes of this project, the average 6-Month LIBOR in June 2014 (the date the agreement was signed) was 0.324%, so the interest rate has been coded as 2.574%. The loan proceeds will be used by BDGM, the largest municipal lender (in terms of number of clients) in the state of Minas Gerais as of 2014, to increase its lending to projects that improve infrastructure in various municipalities in Minas Gerias. These include financing to municipal infrastructure projects themselves, such as construction of public buildings and paving and drainage projects. They also include financing the acquisition of essential equipment and machinery for projects such as (1) road maintenance and construction and (2) garbage collection and sanitation. According to the IDB the project has been completed. However, the date of completion is unspecified. The China Co-Financing Fund was established on 14 January 2013 with a contribution of 2 billion USD by the People's Bank of China, and it is administered by the IDB. For more information, see umbrella Record ID#86526.