Completed Mixed AidData Chinese Aid

Bank of China provides $77.35 million buyer’s credit loan for Phase 1 of National Telecommunications Backbone Project (PBNT)

$77.35M USD

Funder	Bank of China (BOC)
Recipient Organization	Government of Burkina Faso
Country	Burkina Faso
Start Date	Jun 20, 2019
End Date	Dec 10, 2033
Duration	5,287 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`60072`

Grant Description

Bank of China provides $77.35 million buyer’s credit loan for Phase 1 of National Telecommunications Backbone Project (PBNT) On June 20, 2019, the Shenzhen Branch of Bank of China and the Government of Burkina Faso signed a $77.35 million buyer's credit loan agreement for Phase 1 of the National Telecommunications Backbone Project (PBNT).

Then, on October 2, 2019, the Government of Burkina Faso authorized the ratification of the credit agreement.

📋 Loan / Grant Terms

💰 Loan Amountcarries the following borrowing terms: a 12-year maturity

📅 Maturity12 years

⏳ Grace Period3 years

The loan is also backed by a Sinosure buyer’s credit insurance policy. The total cost of the buyer's credit insurance premium $6,843,413.73.

Bank of China reportedly agreed to provide 60% of the funding needed for the first phase of PBNT while the other 40% would be provided by BNP Paribas. However, on October 8, 2019, the BNP Paribas announced that it was no longer involved in this project.

The borrower was expected to use the proceeds of the Bank of China loan to partially finance a commercial contract that it signed with Huawei Technologies Co., Ltd. in July 2014.

The purpose of the project is to construct a 307-kilometer fiber optic network linking the capital Ouagadougou and the city of Po, near the Ghanaian border. This fiber optic ‘backbone’ will have a capacity of 1,600 gigabits per second and will ten municipalities.

It is parter of a larger, EUR 175 million program to provide 5,740 km of fiber optic coverage in Burkina Faso, at a cost of 175 million euros. Construction began on December 10, 2017. Phase 1 was completed and officially inaugurated on October 26, 2021.

📋 Staff Comments

According to September 2018 email correspondence between AidData and the Government of Burkina Faso's Ministry of Ministry of Economy, Finance and Development, Huawei is responsible for paying 3% of the 4% management fee for the loan and $6,843,413.73 for the purchase of buyer's credit insurance from Sinosure.
One source suggests that the loan agreement was signed on September 2, 2018. However, the World Bank's Debtor Reporting System (DRS) indicates that the loan commitment year is 2019 rather than 2018. This issue merits further investigation.
For loan and debt rescheduling records with variable interest rates, AidData calculates the all-in interest rate at T0 based on the reference rate (such as LIBOR or EURIBOR) on the loan start date, plus any known margin. Please see the methodology for additional details.
The French project title is travaux de réalisation clef en main du réseau national de fibre optique or la phase I du réseau national de fibre optique.
In the database of Chinese loan commitments that SAIS-CARI released in July 2020 and updated in March 2021 (which is now maintained by Boston University’s Global Development Policy (GDP) Center), no borrowing terms are recorded. AidData has recorded the borrowing terms reported by the Government of Burkina Faso's Ministry of Ministry of Economy, Finance and Development.

📚 Sources & References

Ambassade de Chine au Burkina : Pékin resserre sa coopération avec Ouagadougou
BURKINA-CHINE : UNE CONVENTION POUR RENFORCER L’INFRASTRUCTURE, les informations sur le prêt signé avec la Banque de Chine pour le financement des travaux de réalisation clef en main du réseau national de fibre optique
Construction begins on Burkina Faso's US$180m fibre optic backbone
Burkina Faso favors the financing of phase I of the national fiber optic network by Bank of China
Burkina Faso: Huawei International launches construction works for national backbone project
Le Burkina Faso favorable au financement de la phase I du réseau national de fibre optique par Bank of China
Burkina Faso : 2018 Article IV Consultation; First Review Under the Extended Credit Facility Arrangement; Request for Waiver for Nonobservance of a Performance Criterion, and Modification of a Performance Criterion-Press Release; Staff Report; and Statement by the Executive Director for Burkina Faso
Burkina Faso: 2018 Article IV Consultation
ROAD
COMMUNICATION AND HOUSING INFRASTRUCTURES
Compte rendu du Conseil des Ministres du mercredi 2 octobre 2019
Debtor Reporting System (DRS)
Fibre optique: Huawei défend son modèle au Burkina
Burkina Faso: le gouvernement a achevé et inauguré la phase 1 du réseau national de fibre optique
Stratégie d'endettement
Internet rapide au Burkina Faso : Le backbone national pour interconnecter les villes
IDS_Average interest on new external debt commitments
Decision 20 Confirmite Credit Project Bacbonne
COMMISSION DES FINANCES ET DU BUDGET (COMFIB) Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.

All Grantees

Government of Burkina Faso

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