Chinese contractors’ troubles in Africa

Articles reproduced on the TradeMark Southern Africa news aggregator — and forwarded to the China-in-Africa mailing list courtesy of Yoon Jung Park — report that Chinese road construction projects have been suspended in both Botswana and Tanzania because of delays in government payments. In Botswana, the suspension concerns a 115-km stretch being built by Sinohydro. In Tanzania, the Chinese Contractors Association asked the government to pay outstanding debt “so that they can complete the construction of 2,405.6 km trunk roads,” or about 66% of the total being built. “Johnson Chii, the vice chairman of the Chinese Contractors Association (CCA), said the money is owed since 2009, and has affected their ability to proceed with the work.”  I wonder if some of the contractors are private enterprises: road projects usually go to state enterprises as main contractors, but Chii’s Africanised name makes me curious about the situation in Tanzania.

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One Response to Chinese contractors’ troubles in Africa

  1. Lady Arc~en~Ciel says:

    Out of the 52 ongoing road projects in Tanzania, 31 are being carried out by 11 Chinese state owned enterprises which all are members of the China International Contractors Association. The earliest start date of the projects is May 2008 and the latest end date is February 2014. The projects are financed for a major part by loans coming from the African Development Fund and for a minor part by the Japanese International Corporation Agency. The Tanzanian government and the Millennium Challenge Corporation Fund (MCCF) which is a United States government agency are the other financiers of the projects. The MCCF finances the project Laela-Sumbawanga won by the European group AARSLFF-BAM joint venture. The delays of payments from the Tanzanian government are probably due to the fact that it does not fulfill its part of the conditions of the loans as defined in the Revised General Conditions Applicable tothe African Development Fund Loan Agreements and Guarantee Agreements and conditions precedent to the disbursements. Further so to see no Chinese private company seems to realize infrastructure project in Tanzania. However I wonder if the Chinese enterprises are the only one suffering from the payments delays!

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