China Eximbank provides RMB 2.564 billion government concessional loan for Malabo City Water Supply Project

Project narrative

On December 13, 2019, the Chinese Government and the Government of Equatorial Guinea signed a preferential loan framework agreement for the Malabo City Water Supply Project. China Eximbank and the Government of Equatorial Guinea subsequently signed a government concessional loan (GCL) agreement for the Malabo City Water Supply Project. The estimated face value of the GCL is RMB 2.564 billion ($389.7 million). The borrowing terms of the loan include a 20-year maturity, a 5-year grace period, and a 2% interest rate. The proceeds of the GCL were to be used by the borrower to finance a $389.7 million (RMB 2.564 billion) commercial contract between the Government of Equatorial Guinea and Gezhuoba Group Co. Ltd. (CGGC), which was signed in April 2016. The original purpose of the project was to construct an urban water supply and pipe network in the city of Malabo. CGGC is the contractor responsible for implementation. However, the Malabo City Water Supply Project has faced multiple delays and setbacks. The COVID-19 pandemic slowed implementation in 2020 and 2021. Then, In January 2023, Vice President Teodoro Nguema Obiang Mangué summoned representatives from the Equatorial Guinea's Ministries of Public Works and Finance, as well as Geproyectos and CGGC, to discuss the importance of expediting project implementation; he also floated the idea of expanding the scope of the project to provide nationwide access to clean drinking water. Then, in March 2023, Teodoro Nguema Obiang Mangué suggested rescoping the project to include electricity and water supply components. AidData had not identified any evidence of project implementation as of June 2023.