Chinese Government provides RMB 85 million interest-free loan for 55.6 km Bata-Niefang Road Reconstruction and Expansion Project

In 2001, the Chinese Government and the Government of Equatorial Guinea signed an agreement on the 55.6 km Bata-Niefang Road Reconstruction and Expansion Project. Then, in 2003, the Chinese Government and the Government of Equatorial Guinea signed an interest-free loan agreement for the 55.6 km Bata-Niefang Road Reconstruction and Expansion Project. China’s Ministry of Commerce reportedly committed RMB 85 million in total and drew the funds from two Economic and Technical Cooperation Agreements (ECTAs) that the two governments signed in 1999 and 2002. The interest-free loan fully disbursed, and as of December 31, 2019, the borrower had not made any principal or interest repayments. The project involved the laying of a second layer of asphalt on a 55.6 km road segment along National Highway No. 1 that begins in the city of Bata and ends in the town of Niefang. The project also sought to expand the width of the road from 7 to 11 meters, improve driving conditions around 20 sharp bends, and alter the design speed of the road from 60 km per hour to 55 km per hour. China Wu Yi Co., Ltd. and China Road & Bridge Corporation (CRBC) were the contractors responsible for implementation. The project design phase commenced in May 2005 and ended in August 2005. Project implementation commenced in October 2011 and reached completion on August 13, 2013.

Additional details

1. The Spanish project title is Proyecto de Reparación de la Carretera Bata Niefang (del km 3 al km 31). The Chinese project title is 巴塔至涅方公路改扩建项目 or 巴塔-涅方公路项目 or 巴塔-涅方公路 or 中国援赤道几内亚巴塔至涅方公路修复项目 or 赤道几内亚——涅方-恩圭公路 or 巴塔至涅方公路改扩建项目. 2. In the database of Chinese loan commitments that it released in July 2020, SAIS-CARI identifies this project as reaching the loan signature (i.e. official commitment) stage but not the implementation stage or completion stage. AidData identifies this project as a fully completed project since multiple sources (including China’s Ministry of Commerce and CRBC) identify 2013 as the year in which this project was completed. 3. Since the borrowing terms for the interest-free loan are unavailable, AidData has set maturity period to 20 years by default and grace period to 10 years by default per China's Foreign Assistance White Paper (http://www.cidca.gov.cn/2018-08/06/c_129925064_3.htm) which states that the maturity period of interest-free loans is 20 years, with a drawdown period of 5 years, grace period of 5 years, and repayment over 10 years. AidData treats the drawdown period as providing 5 years of additional grace. 4. The proceeds of the loan may have been drawn from one or more of the Economic and Technical Cooperation Agreements (ECTAs) and interest-free loan agreements that were signed by the Chinese Government and the Government of Equatorial Guinea on December 17, 1999, December 12, 2000, November 19, 2001, and October 21, 2002. Only the face values of these two interest-free loan agreements are known. According to the Autonomous Fund for Amortization of Public Debt (Caja Autónoma de Amortización de la Deuda Pública) within Equatorial Guinea’s Ministry of Finance and Budget, the RMB 20,000,000 loan that was contracted on December 17, 1999 and the RMB 11,500,000 loan that was contracted on October 21, 2002 had fully disbursed as of December 31, 2019. The borrower never made any principal or interest repayments on either loan. 5. China’s Ministry of Commerce funded the construction of this road between 1995 and 1999 at a cost of RMB 163 million. 6. It is unclear if the RMB 20,000,000 loan that was contracted on December 17, 1999 supported the construction of the Bata-Niefang Road or the reconstruction and expansion of the Bata-Niefang Road. This issue warrants further investigation.

Number of official sources

18

Number of total sources

24