HONG KONG, April 14 (Reuters) - China’s top solar companies Suntech Power Holdings STP.N and Trina Solar TSL.N have signed framework agreements with China Development Bank (CDB) [CHDB.UL], giving the companies access to a combined 80 billion yuan ($11.72 billion) worth of loans in the medium term, company officials said on Wednesday.
Suntech, China’s largest solar cell and panel maker, signed an agreement with CDB for up to 50 billion yuan ($7.33 billion) worth of loans over five years, Rory Macpherson, Suntech’s spokesman, told Reuters.
“It’s a non-binding agreement,” he said. “It’s not related to specific projects...and it could be used for capacity expansion.”
“It essentially shows the strong partnership between Suntech and China Development Bank,” he said, adding that the agreement was signed in the past two weeks.
Trina Solar forged a 30 billion yuan ($4.40 billion) loan agreement with CDB that will last through 2015, Chief Financial Officer Terry Wang said.
While global peers have limited access to cheap state loans, Chinese renewable energy firms are getting a boost from Beijing as they win clean technology projects around the world [ID:nHKG361180]. Much of that is via loans from big state banks for their clients to finance their purchases.
Such deals are unfolding as China aggressively develops its renewable energy sector and as its companies play catch-up with bigger, global peers including German solar cell producer Q-Cells AG QCEG.DE and Spanish wind farm operator Iberdrola (IBE.MC), which have built up solid track records, also with help from more than a decade of government subsidies.
CDB used to be one of China’s three policy lenders directly led by the cabinet, but has been transformed into a commercial lender. (Reporting by Sui-Lee Wee and Leonora Walet; Editing by Jacqueline Wong)