China Eximbank provides $12.3 million buyer’s credit for Addis Ababa–Djibouti Railway Power Supply Project Lot 1 (Linked to Project ID#30171, #59420, #69083, #91823, and #91824)

On September 1, 2014, China Eximbank and the Government of Ethiopia signed a buyer’s credit loan agreement $12,373,946.89 (ETB 246,002,920.278) for the Addis Ababa–Djibouti Railway Power Supply Project Lot 1. The purpose of the project was to electricity a section (Lot 1) of the Addis Ababa–Djibouti Railway. The Government of Ethiopia’s Aid Management Platform (AMP) does not record any disbursements for this loan. However, there is some circumstantial evidence that the project was completed. The EPC contractor that was responsible for project implementation is unknown. There are some indications that the China Eximbank loan for the Addis Ababa–Djibouti Railway Power Supply Project Lot 1 may have financially underperformed vis-a-vis the original expectations of the lender. According to the Government of Ethiopia’s Aid Management Platform, as of September 2019, ICBC suspended about $67 million worth of loan disbursements 'due to [the] cross-default situation of the country’ (see Project ID#58616). Then, in August 2021, China Eximbank withheld $339 million loan disbursements for 12 projects and halted project implementation due to Government of Ethiopia’s rapidly dwindling foreign exchange reserves and debt sustainability challenges. Demisu Lemma, the Director of Chinese Cooperation at the Ethiopian Ministry of Finance, noted at the time that the Ethiopian Government was in discussions with China Eximbank about a potential debt rescheduling (that would involved a 5-year maturity extension and a 1-year grace period extension). Then, after considerable delay, the G20 Common Framework (CF) creditor committee for Ethiopia convened in September 2021, with the French Government and the Chinese Government serving as co-chairs. The CF debt rescheduling talks were still ongoing in mid-2023.

Additional details

1. The system identification number for this project in the Government of Ethiopia’s Aid Management Platform (AMP) is 87143436111871. 2. Lots 2-5 are captured via Project ID#59420, #69083, #91823, and #91824 3. AidData has assumed China Eximbank is the financier because (1) China Eximbank financed Lots 3 and 4; and (2) Mesfin Tafesse & Associates notes that they advised China Eximbank on 'the Ethio- Djibouti railway power supply project' without specifying lots.

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