ICBC contributes to $140 million syndicated loan for Buenaventura Port Construction PPP Refinancing Project (Linked to Project iD#54629)

In August 2010, Sociedad Portuaria Terminal De Contenedores De Buenaventura (TCBuen) — a special purpose vehicle and joint venture — signed a $157 million financing package with a group of banks for Phase 1 of the Port of Buenaventura Development Project. The financing package consisted of a 13-year A loan from the World Bank's International Finance Corporation ( IFC), a 13-year B loan from Costa Rica's regional infrastructure financing corporation CIFI, and two 10-year loans from banks Banco Espirito Santo and WestLB. IFC and the Central American Mezzanine Infrastructure Fund (CAMIF) also provided a joint 10.5-year C loan. The first phase of the $224 million project involved the construction of a new international container terminal — including a 440 meter berth, two ship-to-shore gantry cranes, seven rubber-tired gantry cranes (RTGs) and ancillary facilities — in the Port City of Buenaventura at the Aguacate Marsh before the Cascajal Island. The container terminal is located in Buenaventura’s urban area, 2.4 kilometers away from the existing terminal of Sociedad Portuaria Regional de Buenaventura. Upon completion, the terminal was expected to provide approximately 268,000 twenty foot equivalent units (“TEUs”) in operational capacity and only handle containers. Then, in 2014, TCBuen secured a second financing package for the second phase of the project. The total cost of Phase 2 was $157.9 million and it was financed in part with a $25 million A loan from the IFC and a $65 million B loan from a syndicate of banks. The purpose of Phase 2 was to expand and modernize the Port of Buenaventura and increase its capacity to 610,000 TEUs. Then, in 2018, TCBuen signed a $140 million syndicated secured term loan facility agreement with four banks — Banco Santander, SA; Bank of China (Luxembourg) SA Stockholm Branch; Industrial and Commercial Bank of China Limited Seoul Branch; and Banco Sabadell SA, Miami Branch — to refinance its existing debts from the project’s construction phase (Phase 1). AidData estimates that BOC contributed $35,000,000 (captured via Project ID#54629) and ICBC also contributed $35,000,000 (captured via Project ID#TBD) to this syndicated loan. Construction of the container terminal began in August 2008. Maritime operations began on January 27, 2011. The expansion of the terminal began in 2014. This project has been a subject of local controversy. On December 10, 2009, a local coalition of community councils – Proceso de Comunidades Negras - Regional Palenque El Congal1 (“PCN”) – requested the assistance of the Office of the Compliance Advisor/Ombudsman (CAO) on behalf of community members in Buenaventura to address alleged impacts on vulnerable afro-Colombian communities of the Malecón Project. When the CAO pointed out that the Malecón Project was a Governmental Initiative not funded by IFC and had no apparent link with the IFC-funded private sector TCBuen Project in a different area of Buenaventura, the PCN, together with Fundación Huellas y Rostros del Sentir Humano “Garífuna”, submitted a second version of the complaint describing impacts of TCBuen on its neighboring communities. Signatories raise concerns about ensuring proper consultations with ethnic minorities such as themselves, ensuring community participation in decision-making, protecting their cultural and social ways of life, and guaranteeing access to project information.

Additional details

1. AidData has coded this transaction as a collateralized loan because GLAS Corporation served as the collateral agent (i.e. security agent) for the loan. When lenders take collateral as security for their loans, a collateral/security agent is often appointed to enforce rights against the collateral in the event of the borrower's default under the loan. 2. Sociedad Portuaria Terminal De Contenedores De Buenaventura (TCBuen) is owned by Grup Maritim TCB (66.2% ownership stake), Grupo Empresarial del Pacífico S.A. (20.8% ownership stake), the Regional Governmental Environmental Agency (Corporación Autónoma Regional del Valle del Cauca) (5% ownership stake), and the Regional Government of Valle del Cauca, Municipality of Buenaventura and Minority Shareholders (8% ownership stake). Minority shareholders, numbering 950, include fishermen, wood workers, housewives, small businesspeople etc. Grup Maritim TCB (GMTCB) is Spain’s leading terminal operator company, operating 11 terminals around the world. Grupo Empresarial del Pacífico S.A. (GEPSA) is a Colombian developer based in Buenaventura; the group is dedicated to the design, development, and execution of projects in different economic sectors along Colombia’s Pacific Coast. 3. This project is also known as the TCBuen Port Development Project. 4. The exact size of Bank of China and ICBC’s respective financial contributions to the $140 million syndicated loan are unknown. For the time being, AidData assumes that all 4 members of the lending syndicate contributed equal amounts ($35,000,000) 5. The Office of the Compliance Advisor/Ombudsman is a recourse mechanism for projects supported by the International Finance Corporation and Multilateral Investment Guarantee Agency of the World Bank Group. It was established in 1999 and is based in Washington, D.C.

Number of official sources

7

Number of total sources

13