Narrative
Full Description
Project narrative
On April 29, 2019, the Republic of Congo and China Eximbank signed a debt rescheduling agreement that applied to 8 China Eximbank loans contracted by the Republic of Congo between 2010 and 2014. The first loan (worth $84,000,000) was contracted in 2010 for the Djiri Water Treatment Plant Extension Project (see Record ID#69323) and it carried the following terms: an interest rate of 0.25%, a maturity of 13 to 20 years, and a grace period of 3 to 5 years. The second loan (worth $88,000,000) was contracted in 2010 for the Djiri Water Treatment Distribution Network Project (see Record ID#69335) and it carried the following terms: an interest rate of 0.25%, a maturity of 13 to 20 years, and a grace period of 3 to 5 years. The third loan (worth $1,000,000,000) was contracted in 2013 for the Dolisie-Brazzavile Section of the Pointe-Noire-Brazzaville Road (RN1) Construction Project (see Record ID#369) and it carried the following terms: an interest rate of 0.25%, a maturity of 20 years, and a grace period of 5 years. The fourth loan (worth $96,363,372.65) was contracted in 2011 for the 19.2MW Liouesso Hydroelectric Dam Construction Project (see Record ID#31028) and it carried the following terms: an interest rate of 0.25%, a maturity of 19 years, and a grace period of 4 years. The fifth loan (worth $62,310,857.20) was contracted in 2014 for the Brazzaville Shopping Center Project (see Record ID#58408) and it carried the following terms: an interest rate of 0.25%, a maturity of 14 years, and a grace period of 3 to 5 years. The sixth loan (worth $54,800,000) was contracted in 2013 for the 264 Mpila Social Housing Units Construction Project (see Record ID#31029) and it carried the following terms: an interest rate of 0.25%, a maturity of 13 years, and a grace period of 3 to 5 years. The seventh loan (worth $328,100,000) was contracted in 2014 for the Mpila Twin Towers Construction Project (see Record ID#58720) and it carried the following terms: an interest rate of 0.25%, a maturity of 13 to 20 years, and a grace period of 3 to 5 years. The eighth loan (worth $19,191,458.40) was contracted in 2014 for the Mpila Memorial Construction Project (see Record ID#58721) and it carried the following terms: an interest rate of 0.25%, a maturity of 14 years, and a grace period of 3 to 5 years. The Republic of Congo’s outstanding debt obligations under these 8 loans amounted to $1,612,330,000 at the point of rescheduling in April 2019. Under the terms of the rescheduling agreement, the Republic of Congo agreed to repay 33% of its outstanding debt obligations under each of these 8 loans ($532,068,900 in total) within 3 years. For the remaining 67% of its outstanding debt obligations under each of these 8 loans, the Republic of Congo agreed to meet its obligations according to extended maturities and higher interest rates. More specifically, China Eximbank agreed to extend the maturity of each loan by 15 years, reset the interest rate of the loan for the Dolisie-Brazzavile Section of the Pointe-Noire-Brazzaville Road (RN1) Construction Project to 2% and reset the interest rates for the other seven loans to 1.5%. Therefore, the estimated maturities and interest rates of these 8 loans after the April 2019 rescheduling are as follows: a 31.5-year maturity and 1.5% interest rate for the China Eximbank loan supporting the Djiri Water Treatment Plant Extension Project (captured via Record ID#58340); a 31.5-year maturity and 1.5% interest rate for the China Eximbank loan supporting the Djiri Water Treatment Distribution Network Project (captured via Record ID#89048); a 35-year maturity and 2% interest rate for the China Eximbank loan supporting the Dolisie-Brazzavile Section of the Pointe-Noire-Brazzaville Road (RN1) Construction Project (captured via Record ID#89049); a 34-year maturity and 1.5% interest rate for the China Eximbank loan supporting the 19.2MW Liouesso Hydroelectric Dam Construction Project (captured via Record ID#89051); a 29-year maturity and 1.5% interest rate for the China Eximbank loan supporting the Brazzaville Shopping Center Project (captured via Record ID#89054); a 35-year maturity and 1.5% interest rate for the China Eximbank loan supporting the 264 Mpila Social Housing Units Construction Project (captured via Record ID#89061); a 31.5-year maturity and 1.5% interest rate for the China Eximbank loan supporting the Mpila Twin Towers Construction Project (captured via Record ID#89062); and a 29-year maturity and 1.5% interest rate for the China Eximbank loan supporting the Mpila Memorial Construction Project (see Record ID#89063). After restructuring all eight of these loans, the net present value of total repayments to China Eximbank rose from $1.3 billion (before restructuring) to $1.6 billion (after restructuring). This increase represents a 23% increase in net present value terms.