China Eximbank provides $127.5 million loan for Telecommunication Equipment and Infrastructure Modernization Project

On August 29, 2019, during the Prime Minister of the Republic of Uzbekistan’s visit to Shenzen, an MOU was signed regarding a concessional loan from China Eximbank to LLC Universal Mobile Systems (UMS or МЧЖ) — a special purpose vehicle and subsidiary of the Uzbek state-owned company Uzbektelecom — for the Telecommunication Equipment and Infrastructure Modernization Project. Then, in August 2021, China Eximbank and the National Bank for Foreign Economic Activity of the Republic of Uzbekistan signed a $127,500,000 loan agreement for the Telecommunication Equipment and Infrastructure Modernization Project. This loan carries the following borrowing terms: a 15 year maturity (final maturity date: September 2026), a 5 year grace period, and a 3.5% interest rate. The loan proceeds were on-lent from NBU to LLC Universal Mobile Systems. The ultimate borrower was expected to use the proceeds of the loan to partially finance a commercial contract with Huawei Technologies Co. Ltd. A loan disbursement of $52,106,288 took place in 2021. Another loan disbursement of $12,043,891 took place in 2022. The purpose of the project is to enable UMS to modernize its telecommunications equipment and infrastructure. Huawei Technologies Co. Ltd. is the contractor responsible for implementation.

Additional details

1. The Uzbek project title is мобиль алоқа операторининг технологик ускуналарини модернизация қилиш ва алоқа тизимларини кенгайтириш инвестиция лойиҳаси. 2. The Government of Uzbekistan holds a 50.01% ownership stake in LLC Universal Mobile Systems. 3. This China Eximbank loan is not included in the China’s Overseas Development Finance Dataset that Boston University's Global Development Policy Center published in December 2020.

Number of official sources

10

Number of total sources

12