Deutsche bank
The Middle East and Africa boast some of the largest investment flows from China globally, and so far Chinese state-owned banks have dominated the funding needs of Belt and Road projects in the region.
Local and regional banks are scrutinizing the hefty infrastructure deals and are hoping to make more bankable investments further down the track by financing local companies and sub-contractors involved in the projects.
Some international banks are involved at a more meaningful level. In December 2016, Deutsche Bank’s structured trade and export finance team, with Evert-Jan Zondag, arranged a $105 million advanced payment guarantee issue for Chinese-owned Sepco3 Electric Power Construction Corporation and its Al-Anbar Combined Cycle power plant development in Iraq.
This amounted to 1% of the entire project, worth $10.5 billion, and was competitively priced in comparison to similar deals offered by Chinese banks.
For Sepco3, the deal offered a simple and straightforward structure that allowed for cost savings and provided the necessary transparency for all parties involved.
Founded in 1985, Sepco3 Electric Power Construction Corporation is based in Qingdao, China. It has been an important player in China’s One Belt, One Road initiative since 2013.
The company has projects in Saudi Arabia, Oman, Jordan, Egypt, Morocco, as well as Iraq. Once in operation, the 1,64-MW power plant will be one of the largest and most efficient combined-cycle power plants in Iraq.