Narrative
Full Description
Project narrative
On April 24, 2020, Bank of China and the Government of Côte d'Ivoire signed an EUR 111,927,882.64 (CFA 73,443,492,550.79) loan agreement for Phase 2 of the Ministry of Interior and Security Unified Communication System Project. The borrowing terms of the loan are unknown. However, it is known that the borrower was expected to use the proceeds of the loan to finance approximately 90% of the cost of an EUR 124 million commercial contract between Côte d'Ivoire’s Ministry of Interior and Security and China Railway Construction International Group, which was signed in December 2019. According to the Government of Côte d'Ivoire’s Aid Management Platform (AMP), the Bank of China loan had achieved a 99.8% disbursement rate (CFA 73,325,102,606 out of CFA 73,443,492,550.79) as of December 31, 2023. Bank of China made seven loan disbursements worth CFA 73,325,102,606 in 2021, 2022, and 2023: a CFA 15,297,225,415 disbursement on December 31, 2021, a CFA 23,445,307,879 disbursement on January 31, 2022, a CFA 9,095,717,527 disbursement on October 31, 2022, a CFA 7,496,774,395 disbursement on December 31, 2022, a CFA 9,116,457,234 disbursement on August 31, 2023, a CFA 6,454,072,856 disbursement on September 30, 2023, and a CFA 2,419,547,300 disbursement on December 31, 2023. Phase 2 involves the construction of a national emergency command center (with 2 floors and a total of 1,000 square meters) for the police, military, and fire department as well as the installation of video surveillance towers in 46 locations within 22 cities. Phase 2 also involves the construction of integrated military IT network, the unification and modernization of communication and command systems within the Ministry of Interior and Security. China Railway Construction International Group is the contractor responsible for implementation. Phase 2 work commenced in late 2021/early 2022. Phase 2 was originally expected to reach completion on December 31, 2022.
Staff comments
1. The French project title is Projet d'implantation d'un système de défense_ Phase II. The Chinese project title is 国防部统一通讯二期工程项目 or 署的科特迪瓦国防部统一通讯二期工程项目. 2. The AMP system identification number for the Bank of China loan is 1120071335705. The AMP also suggests that ICBC may have co-financed the loan. This issue merits further investigation. 3. This Bank of China loan is not included in the Chinese Loans to Africa (CLA) database that is managed by the Global Development Policy Center at Boston University and SAIS-CARI. 4. Bank of China also financed Phase 1 of the Ministry of Interior and Security Unified Communication System Project (as captured via Record ID#89415 and Record ID#92201). 5. In December 2019, Côte d'Ivoire’s Ministry of Interior and Security and China Railway Construction International Group reportedly signed a EUR 124 million EPC+F contract for Phase 2 of the Ministry of Interior and Security Unified Communication System Project. One source suggests that Côte d'Ivoire’s Ministry of Defense was responsible for 15% of the cost of an EPC+F contract and China Railway Construction International Group was responsible for obtaining a commercial loan for financing the remaining 85% of the project cost (backed by a sovereign guarantee from the Government of Côte d'Ivoire). However, the source does not identify the financier responsible for providing a commercial loan to China Railway Construction International Group (backed by a sovereign guarantee from the Government of Côte d'Ivoire) is unknown. This issue merits further investigation. 6. The precise project implementation start date is unknown. For the time being, AidData relies on the first loan disbursement date (December 31, 2021) as a proxy for the project implementation start date. This issue warrants further investigation. 7. The face value of the loan is recorded in the AMP as CFA 73,443,492,550.79. However, the loan was almost certainly denominated in EUR, so AidData has used the prevailing CFA-to-EUR exchange rate (1 CFA = 0.001524 EUR 1) at the time of the loan commitment to estimate the EUR face value of the loan (EUR 111,927,882.64). 8. According to the World Bank's Debtor Reporting System (DRS), the weighted average grace period of all ‘private’ sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Côte d'Ivoire was 3.4166 years in 2020. AidData estimates the grace period of the Bank of China loan that supported Phase 2 of the Ministry of Interior and Security Unified Communication System Project by using this figure. See https://www.dropbox.com/scl/fi/i7f56vi0ix8drznpbaczg/Weighted-average-borrowing-terms-from-Chinese-Lenders-to-Ivory-Coast-April-2024-IDS-Data-Extraction.xlsx?rlkey=0uj6y8don6vdg39v28f1y4nwz&dl=0 9. According to the World Bank's Debtor Reporting System (DRS), the weighted average maturity of all ‘private’ sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Côte d'Ivoire was 14.9166 years in 2020. AidData estimates the maturity of the Bank of China loan that supported Phase 2 of the Ministry of Interior and Security Unified Communication System Project by using this figure. See https://www.dropbox.com/scl/fi/i7f56vi0ix8drznpbaczg/Weighted-average-borrowing-terms-from-Chinese-Lenders-to-Ivory-Coast-April-2024-IDS-Data-Extraction.xlsx?rlkey=0uj6y8don6vdg39v28f1y4nwz&dl=0 10. According to the World Bank's Debtor Reporting System (DRS), the weighted average interest rate of all ‘private’ sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Côte d'Ivoire was 2.7% in 2020. AidData estimates the interest rate of the Bank of China loan that supported Phase 2 of the Ministry of Interior and Security Unified Communication System Project by using this figure. See https://www.dropbox.com/scl/fi/i7f56vi0ix8drznpbaczg/Weighted-average-borrowing-terms-from-Chinese-Lenders-to-Ivory-Coast-April-2024-IDS-Data-Extraction.xlsx?rlkey=0uj6y8don6vdg39v28f1y4nwz&dl=0