The FINANCIAL — IFC, a member of the World Bank Group, will lead a $300 million financing package for the Beijing Enterprises Water Group (“BEWG”) to support the group’s environmental water businesses and promote sustainable economic development in China.
IFC will provide $28 million from its own account and $21 million from the IFC-Managed Co-Lending Portfolio Program, a syndication platform that allows institutional investors to passively participate in IFC’s senior loan portfolio. The remaining $251 million B loan will come from 13 commercial financial institutions. The strong support that this syndicated loan received from the banks is an indication of the confidence in the company and water sector development in China, according to IFC.
“IFC’s support provides the necessary capital for us to pursue our expansion plans, including improving treatment quality in 12 municipalities across nine provinces of China,” said Mr. Li Yongcheng, Vice Chairman of Beijing Enterprises Group Company Limited and Chairman of BEWG. “This partnership will mean significant environmental and health benefits for local populations.”
China’s economy has experienced rapid growth in the past decade. However, high population density, urbanization, and industrialization have significantly degraded its water resources and led to water shortages. The country’s water resources per capita are approximately only a third of world average. Out of the country’s more than 600 cities, about 400 are suffering from water shortages.
“We believe water holds great potential to support China’s continued economic development,” said Hyun-Chan Cho, IFC’s Head of Infrastructure, Asia. “We are committed to work with our clients, who have established implementation track records and operational capacities, to further improve water and wastewater treatment services and inclusive growth in China.”