People’s Republic of Bangladesh/Loan insurance for Ghorasal Polash Urea Fertilizer Project
Nippon Export and Investment Insurance
Nippon Export and Investment Insurance (NEXI, Chairman and CEO: Atsuo Kuroda) has decided to provide loan insurance for the Ghorasal Polash Urea Fertilizer Project to be implemented by the Bangladesh Chemical Industries Corporation (BCIC), the state-owned fertilizer manufacturer in the People’s Republic of Bangladesh.
In this project, the BCIC will construct a new fertilizer plant in Ghorasal, 50 kilometers northeast of Dhaka, the capital of Bangladesh. The Mitsubishi Heavy Industries, Ltd. (MHI) and China National Chemical Engineering No.7 Construction Co., Ltd. participate in the project as EPC contractors.
The project will be financed by two kinds of co-financing: one is the NEXI/JBIC Buyers Credit Facility consisting of the MUFG Bank, Ltd. and The Hongkong and Shanghai Banking Corporation Limited, Tokyo Branch (hereinafter referred to as Japanese financial institutions) in addition to the Japan Bank for International Cooperation (JBIC), and the other is offered by the aforementioned Japanese private financial institutions with a guarantee from the Multilateral Investment Guarantee Agency (MIGA). NEXI will provide loan insurance for the portion extended by the Japanese private financial institutions of the NEXI/JBIC Buyers Credit Facility.
Bangladesh is an agricultural powerhouse where the agriculture and forestry sector accounts for more than 10% of its GDP, with approximately 40% of the workforce engaged in agriculture. In addition to an increasing demand for fertilizer due to the country’s recent growing economy and rising population, BCIC’s aging existing plants have caused the producer to rely on the import of fertilizer to satisfy part of the strong demand. Under these circumstances, this project is expected to allow the BCIC to increase domestic production, making a significant contribution to the economic development of Bangladesh. Furthermore, the project is likely to both reduce the environmental impact and increase urea production, by utilizing the MHI’s CO2 capture technology. The main equipment of the plant will also be exported from Japan.
As Japan’s policy-based financial institution, NEXI continues to actively support exports by Japanese companies.
| Borrower | Bangladesh Chemical Industries Corporation |
| Insured value | Approximately JPY 44.2 billion |
| Tenor | Approximately 8 years |
| Covered risks | Political Risk 100% and Commercial Risk 95% (with sovereign special clause) |
Contact: Natural Resources Group Ⅱ, Structured and Trade Finance Insurance Department
Tel: +81-(0)3-3512-7744