ICBC contributes to $1.18 billion syndicated loan for National Road Line B (Corredor B Toll Road) (Linked to Project ID#54738)

On July 26, 2018, the Argentine National Road Agency and CCA Green B S.A. — a special purpose vehicle jointly owned by China Construction America (CCA) Inc. and Green SA (a local Argentinian firm) — signed a $2.13 billion franchise (concession) agreement for the National Road Line B (Corredor B Toll Road) Project. Under the terms of the agreement, CCA Green B S.A. assumed responsibility for constructing a 538 km Corredor B toll road over a five year period and operating the road for 10 years after the end of the construction period. Then, on April 25, 2019, CCA Green B S.A. signed $1.18 billion syndicated loan agreement with Bank of China, the Industrial and Commercial Bank of China (ICBC), and Sumitomo Mitsui Banking Corporation (SMBC). The portion contributed by ICBC is captured in project #92369. The portion contributed by Bank of China is captured in project #54738. The loan reportedly carries a 15 year maturity, but its interest rate is unknown. The borrower also purchased a credit insurance policy from Sinosure. The proceeds of the loan were to be used by the borrower to finance an EPC contract with China State Construction Engineering Corporation (CSCEC). The purpose of the 538 km National Road Line B (Corredor B Toll Road), which is being financed and implemented on a Public-Private Partnership (PPP) basis, is to convert two sections (113 km and 31 km) of National Route 5 into a highway and convert another 372 km section into a safe highway. National Route 5 passes through the provinces of Buenos Aires and La Pampa, which are two important industrial and agricultural economic zones in Argentina. After the completion of the project, the vehicle traveling speed at this road section is expected increase to 130km/h and the road will be widened to a two-way four-lane road. The highway is also expect top play a key role in accelerating economic growth in the region by effectively contributing to the government’s tax revenue, creating employment opportunities and boosting the development of relevant industries. On December 6, 2018, a project commencement ceremony took place in Suipacha, Buenos Aires. Then, in January 2019, the former Argentine President Mauricio Macri and the governor of Buenos Aires, María Eugenia Vidal, visited the province of Buenos Aires Suipacha and inspected the project site. However, the project encountered various implementation obstacles in 2019 and 2020. In September 2019, a contractual dispute between CCA and Green SA was taken to the International Court of Arbitration. Then, in early 2020, Argentina’s Public Works Minister Gabriel Katopodis announced that 5 of 6 PPP contracts were terminated (referring to them as "a ruinous model”). These contractual issues led to major work stoppages. However, multiple reports suggest that, as of late 2020, the concession agreement with CCA Green B S.A. had still not been cancelled.

Additional details

1. This project is also known as the National Route B Highway Project and the Corredor Vial B Transformation Project. The Chinese project title is 阿根廷国道B线特许经营项目. 2. According to a 2018 Project Finance International publication, SMBC, ICBC, and Bank of China each contributed $355 million to the loan syndicate. As such, AidData records $355 million as the commitment (transaction) amount for the time being. However, this issue warrants further investigation. 3. China Construction America (CCA) Inc. is a local subsidiary of China State Construction Engineering Corporation (CSCEC). 4. Some sources suggest that China Construction America (CCA) Inc. rather than CCA Green B S.A. is the borrower. This issue warrants further investigation. 5. Some sources refer to the project as the Luján-La Pampa highway 6. Some sources indicate the portion of CCA Green B S.A. that was owned by Green SA was purchased by CCA at some point in the implementation process. This issue warrants further investigation and has implications on the organization origin value for CCA Green B S.A.

Number of official sources

7

Number of total sources

27