China Eximbank provides preferential buyer’s credit for Information and Communication Technology (ICT) Network Extension Project

On December 8, 2009, China Eximbank and the the Government of Mongolia signed a preferential buyer’s credit (PBC) agreement for the Information and Communication Technology (ICT) Network Extension Project. The PBC was approved under a $300 million line of credit (general loan agreement) for various projects that was signed by the two governments on November 28, 2005. The borrowing terms of the PBC are unknown. However, it is known that the borrower was to use the proceeds of the PBC to partially finance a $45,649,610.37 commercial contract with ZTE Corporation, which was signed on August 17, 2009. The PBC officially entered into force on April 8, 2010. The purpose of the project was to establish a high-speed fiber optic cable network in Mongolia. The ultimate goals of the project were to increase the scope and quality of mobile communication services, improve the provision of e-government services, expand the provision of distance learning, internet access, and video conferencing, and bridge the urban-rural digital data gap. ZTE Corporation was the general EPC contractor responsible for implementation. However, there were also 17 Mongolian subcontractors involved in implementation (Moncable, New Optics, S&M, Leadernet, Nopsan, Satylate Power, Geotrass, Supercom, Comtech, Quarry Mart, Portal, Skynetworks, Gemnet, Badral, Kharaat Teel, Berjin Unt, and Newtelecom). Fiber optic installation commenced in August 2011. By June 2014, 9000 km of high speed fiber optic cable network and transmission facilities had been established across 150 soums within 21 aimags. As a result, 90 percent of all soums in Mongolia had access to high-speed Internet and other public and private e-services. Of the 150 soums connected to the fiber-optic network, 129 soums were part of an integrated monitoring system and are ready for service, and 21 additional soums were expected to be fully integrated by August 15, 2014. The project was ultimately completed on August 25, 2014.

Additional details

1. This project is also known as the ICT Network Expansion and Modernization Project. The Mongolian project title is “Мэдээлэл, харилцаа холбооны үндсэн сүлжээний өргөтгөл” төсөл or Мэдээлэл, холбооны үндсэн сүлжээний өргөтгөл, шинэчлэл or Монгол Улсын Мэдээлэл, холбооны үндсэн сүлжээний өргөтгөл, шинэчлэл төслийн . 2. The Mongolian translation of the December 8, 2009 loan agreement that was signed is ‘Монгол Улсын Сангийн яам, БНХАУ-ын Экспорт, импорт банк хоорондын орон сууцны хороолол төслийн тусгайлсан зээлийн хэлэлцээр’. 3. One official source (http://www.beijing.embassy.mn/index.php?moduls=9) claims that the loan signature (i.e. official commitment) date was December 8, 2009 and another official source (https://www.dropbox.com/s/acfwsko858azkbr/%2820%2B%29%20%D0%A5%D0%B0%D1%80%D0%B8%D0%BB%D1%86%D0%B0%D0%B0%20%D1%85%D0%BE%D0%BB%D0%B1%D0%BE%D0%BE%2C%20%D0%BC%D1%8D%D0%B4%D1%8D%D1%8D%D0%BB%D0%BB%D0%B8%D0%B9%D0%BD%20%D1%82%D0%B5%D1%85%D0%BD%D0%BE%D0%BB%D0%BE%D0%B3%D0%B8%D0%B9%D0%BD%20%D0%B3%D0%B0%D0%B7%D0%B0%D1%80%20-%20Posts%20_%20Facebook.pdf?dl=0) claims that the loan signature date was November 17-19, 2009. For the time being, AidData relies upon the latter date because the finalization of a commercial contract typically predates the signature of a China Eximbank loan agreement. However, this issue merits further investigation. 4. The precise face value of the China Eximbank PBC is unknown. However, the borrower was authorized to use the proceeds of the PBC to finance up to 85% of the commercial contract with ZTE Corporation. Therefore, AidData assumes that the face value of the PBC was equivalent to 85% of $45,649,610.37 ($38,802,168). 5. Detailed project maps and descriptions of the 149 fiber optic line segments supported by the project (and when they were completed) can be accessed via https://www.dropbox.com/s/acfwsko858azkbr/%2820%2B%29%20%D0%A5%D0%B0%D1%80%D0%B8%D0%BB%D1%86%D0%B0%D0%B0%20%D1%85%D0%BE%D0%BB%D0%B1%D0%BE%D0%BE%2C%20%D0%BC%D1%8D%D0%B4%D1%8D%D1%8D%D0%BB%D0%BB%D0%B8%D0%B9%D0%BD%20%D1%82%D0%B5%D1%85%D0%BD%D0%BE%D0%BB%D0%BE%D0%B3%D0%B8%D0%B9%D0%BD%20%D0%B3%D0%B0%D0%B7%D0%B0%D1%80%20-%20Posts%20_%20Facebook.pdf?dl=0 and ttps://prezi.com/yzoz4h6ybdsz/presentation/

Number of official sources

5

Number of total sources

10