China Eximbank provides $111.9 million preferential buyer’s credit for 500 KV Backbone & Sub-Region Transmission Line Project

Project narrative

According to the Government of Cambodia’s ODA database, China Eximbank and the Government of Cambodia signed a $111,993,600 preferential buyer’s credit (PBC) agreement on February 17, 2020 for the 500 KV Backbone & Sub-Region Transmission Line Project. The borrowing terms of the PBC (loan) are as follows: a 2% interest rate, a 7-year grace period, and a 20-year maturity. China Eximbank made two loan disbursements in 2020 and 2021: a $72,795,840 loan disbursement in 2020 and a $16,799,040 loan disbursement in 2021. The lender was originally scheduled to make additional disbursements worth $11,199,360 in 2022 and $11,199,360 in 2023. The borrower was expected to use the proceeds of the loan to finance an EPC contract with China National Heavy Machinery Corporation (Sinomach), which was signed on January 11, 2018. The purpose of the project is to build 2 transmission lines. The first line runs from Stung Treng to Cambodia-Laos border and the second line runs through the capital city of Phnom Penh. China National Heavy Machinery Corporation (Sinomach) is the EPC contractor responsible for implementation. Project implementation officially commenced on March 1, 2020. The transmission line from Stung Treng to Cambodia-Laos border was completed and put into service in 2020. Work on the second line that runs through the capital city of Phnom Penh began in August 2021. The originally expected project completion date was December 31, 2023.