Summaries of proposed guarantees are provided prior to Board consideration and before final contract signing, and they are therefore subject to change. Project briefs are disclosed after Board consideration and contract signing and reflect the terms of the project at the time of contract signature. Environmental and Social Review Summaries are provided for projects assigned an Environmental Assessment Category of A or B.
- Project name
- Hitachi Construction Machinery Zambia Co. Ltd
- Project ID
- Fiscal year
- Guarantee holder
Hitachi Construction Machinery Southern Africa Co., Ltd.
Hitachi Construction Machinery Africa Pty. Ltd
- Investor country
- Host country
- Environmental category
- Date SPG disclosed
- February 24, 2011
- Project Board date
- March 30, 2011
- Gross exposure
- $13.5 million
- Project type
On March 31, 2011, MIGA issued guarantees totaling $13.5 million to Hitachi Construction Machinery Africa Pty. Ltd. and Hitachi Construction Machinery Southern Africa Co., Ltd. of South Africa. The coverage is for a period of up to 20 years against the risks of transfer restriction, expropriation, and war and civil disturbance.
The project involves the construction and operation of a remanufacturing plant in Lusaka, Zambia. The facility will recondition used parts and components from heavy-duty earth-moving machinery, primarily in the mining sector, to provide a more cost-effective maintenance solution to serve clients within Zambia as well as in adjacent countries.
The project’s expected developmental impacts include job creation, state-of-the-art technology transfer, and technical skills transfer through structured training programs. In addition, the project’s focus on the reconditioning of old parts will reduce the demand for scarce resources that are used to manufacture new complex machinery and equipment.
MIGA’s support for the project is aligned with the World Bank Group’s Country Partnership Strategy, which calls for improving competitiveness in order to accelerate economic growth. The project addresses this goal through its expected technology and skills transfer. MIGA’s participation in the project is also aligned with key agency priorities, which include supporting South-South investment and investment into IDA-eligible countries.