China Eximbank restructures $981 million buyer’s credit loan tranche for Meiso-Dewanle Section of the Addis Ababa–Djibouti Railway Project via maturity and grace period extensions (Linked to Project ID#30171, #70085, #70086, #70083, #85163, #61941)

On May 15, 2013, China Eximbank and the Government of Ethiopia signed a $2,490,760,000 buyer’s credit loan (BCL) agreement for the Addis Ababa–Djibouti Railway Project. The BCL carried the following borrowing terms: a 15-year maturity, a 6-year grace period, and an interest rate of LIBOR plus a 3% margin. The loan was also backed by a credit insurance policy from China Export and Credit Insurance Corporation (SINOSURE). China Eximbank provided the loan in three separate loan tranches. The first tranche is worth $1,289,029,000 (captured via Project ID#70086) and it supported the Sebeta-Adama–Meiso Section of the Addis Ababa–Djibouti Railway Project. The second tranche is worth $981,260,000 (captured via Project ID#70085) and it supported the Meiso-Dewanle Section of the Addis Ababa–Djibouti Railway Project. The third tranche is worth $220,471,000 (captured via Project ID#70083) and it supported the Addis Ababa–Djibouti Railway Rolling Stock Supply Project. The borrower was expected to use the proceeds of the $1,289,029,000 China Eximbank loan tranche to finance 70% of the cost of a $1,841,470,000.00 commercial (EPC) contract between the Ethiopian Railway Corporation (ERC) and China Railway Engineering Corporation (CREC), which was signed on October 25, 2011 (and modified on November 5, 2012, February 7, 2013, and March 15, 2013) to support the construction of a 329 km Sebeta (Addis Ababa) to Miesso section of the railway. The borrower was expected to use the proceeds of the $981,260,000 China Eximbank loan to finance 70% of the cost of a $1,401,800,000 commercial (EPC) contract between the ERC and China Civil Engineering Construction Corporation (CCECC), which was signed on December 16, 2011 (and modified on November 2, 2012, February 7, 2013 and March 8, 2013) to support the construction of a 339 km section of the railway that runs from Miesso (Meiso) to Dewelle (Dewanle) on Ethiopia's border with Djibouti. The borrower was expected to use the proceeds of the $220,471,000 China Eximbank loan to finance approximately 85% of a $259 million commercial contract between China North Industries Corporation (NORINCO) and the ERC, which was signed in March 2013 to support the Addis Ababa–Djibouti Railway Rolling Stock Supply Project. Then, on or around September 4, 2018, China Eximbank and the Government of Ethiopia restructured the $2,490,760,000 buyer’s credit loan agreement that was signed in May 2013. Under the terms of the restructuring agreement, the maturity of the loan was reportedly extended by an additional twenty years (from 15 years to 35 years) and the grace period of the loan was reportedly extended by an additional 4 years (from 6 years to 10 years).

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