Negotiation of a loan of USD 500 milion – Transmission Efficiency Project (TEP) funded by World Bank
Thứ sáu, 10/10/2014 | 00:00 GMT+7
On 11th July 2014, at State Bank of Vietnam (SBV)’s headquarters, after one-day working, the loan for “Transmission Efficiency Project” (TEP) was negotiated successfully. Agreed Minutes of negotiation results have been signed. The project to be invested by the National Power Transmission Corporation (EVNNPT), funded by World Bank (WB), with a total fund of USD 500 million, and signed between WB and SBV – representative to the Government of Vietnam.
The negotiation was chaired by Mrs. Doan Hoai Anh – Director of International Cooperation Department, SBV. Participating in the negotiation were representatives of Office of President, Office of Government, representatives of Ministries: Finance, Plan and Investment, Justics, Industry and Trade; Vietnam Electricity (EVN), EVNNPT and WB. All the project legal documents such as Loan Agreement, Project Agreement, Project Appraisal document, Procurement Plan, etc have been negotiated and agreed upon. Accordingly, the basic conditions of the loan include:
- Project duration: 06 years (2014- 2019)
- Loan duration : 26 years (including a grace of 10 years)
- Source of fund: IBRD (International Bank for Reconstruction and Development)
- Arrangement fee: 0.25% of total Loan
- Interest: LIBOR 6 months (USD) + variable differences
- On-lending fee: 0.25%/year.
- Commitment fee: 0.25%
The Transmission Efficiency Project (TEP) includes of 3 components: (i) Development of transmission infrastructure, (ii) Development of Smart Grid, and (iii) Capacity building. The main objectives of project are to support the implementation of investment program on capacity building of power transmission network of Vietnam, increase the efficiency, reliability of power supply services and strengthen capacity building for EVNNPT. The project to be implemented in the whole country, with participation of all EVNNPT’s subsidiaries. EVNNPT will be the main beneficiary of the project. The indirect beneficiaries will include all people, who gain benefits from: (i) Increased reliability of power supply, reduced the unserved demands and quantity and duration of power cut-off, and (ii) increased energy efficiency, reduced overall costs and green house gas emission.
At present, SBV is in the middle of finalizing the report of negotiation results to submit to the Government for approval. WB and EVNNPT will carry out the required procedures in order to sign the Loan Agreement and take into effect of the Loan Agreement at the soonest time.