Zimbabwe border project closes DFI-backed loan
The Zimborders consortium has signed a $71 million DFI-backed financing to back the Beitbridge border post upgrade PPP on Zimbabwe’s border with South Africa. Signed on 30 September this year, the deal reached financial close on 27 November.
The project, which has an estimated cost of $296 and is located on the Limpopo River, is structured via a 17.5-year PPP contract with the government of Zimbabwe signed in July. The asset was one of the first two major PPPs in the Southern African state’s road sector and the last upgrade was signed in August 2011.
The facility comprises two main tranches: a commercial portion put up by Absa Bank; Nedbank, RMB, and Standard Bank; and a DFI element provided by Afreximbank and Emerging African Infrastructure Fund (EAIF). PIDG member EAIF “was able to fill a funding gap between senior debt and equity” as part of its $43.7 senior and junior debt contribution to the project financing, the DFI said.
The border post generates revenue through tolls and the concessionaire will receive fees as part of the operation contract. There is no word on the existence of a fee guarantee mechanism to ensure a steady stream of income for the Zimborders consortium.
