#Ghana: Financing Agreed for 100km Section of Western Railway Line

Western firms acted urgently on this project, raising financing without involvement of any Chinese entity. Is this the new trend in western push to counter China’s BRI?

Development finance institutions Deutsche Bank and Investec, in partnership with Swedish Export Credit Corporation (SEK) and Export Credit Agency (EKN) as well as Export Credit Insurance Corporation of South Africa (ECIC), have arranged for close to US$ 708M in financing for the construction a 100km section (from Takoradi port to Huni Valley) of the Western Railway Line in Ghana.

The financing consists of two loans that the Deutsche Bank acted as mandated lead arranger (MLA), in favor of the Ministry of Finance of Ghana. The first loan, which is backed by EKN and fully arranged by Deutsche Bank, is an approximately US$ 618M loan covering the bulk of the cost while the second one is about US$ 89M commercial loan arranged and structured by Investec to cover the down payment on the EKN backed financing.

The latter is backed by ECIC and funded by a syndicate of Investec Bank Ltd, Rand Merchant Bank, a division of First Rand Bank Limited, Nedbank Limited through its London branch and Sanlam life Insurance Limited, acting through its Sanlam Capital Markets division.

The engineering, procurement and construction (EPC) contract of this section of the project will be carried out by Amandi Investment, together with Bluebird Finance & Projects, acting as the lead financial adviser for the EPC.

About the Western Railway Line

The Western Rail Line, which is also known as the Takoradi – Kumasi railway line, has a total of 339 kilometers from the Takoradi Port, in the Western region of Ghana to Kumasi, in southern Ghana, with a branch line from Dunkwa to Awaso.

It is key to the haulage of agricultural produce and minerals from the middle belt to Takoradi port and it is also home to key bauxite mines, which are the bedrock of the country’s integrated bauxite aluminium master plan.

Source- Construction Review Online

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