Shanghai Pudong -- Veolia Water Corporation, Ltd.

MIGA issued a guarantee of $70 million to Compagnie Générale des Eaux of France for its $245 million equity investment in Shanghai Pudong–Veolia Water Corporation, Ltd. of China. The guarantee is for a period of 15 years and provides coverage against the risk of expropriation.

Compagnie Générale des Eaux, a wholly-owned subsidiary of Veolia Environnement, purchased a 50 percent equity interest in Shanghai Municipal Waterworks Pudong Co., Ltd. from the state-owned Shanghai Water Asset Management and Development Co., Ltd., creating the joint-venture Shanghai Pudong-Veolia Water Corporation, Ltd. The joint-venture will be responsible for the treatment, distribution and sale of potable water, and for the maintenance of service facilities. The project currently has distribution rights for a 1,700 km network capable of supplying 1.3 million cubic meters of water daily to more that 1.7 million people living in the Pudong district.

The project seeks to improve the supply and quality of drinkable water to the rapidly growing 1.7 million population living in the Pudong district of Shanghai. The investor will bring managerial and technical expertise to the existing operations. Compagnie Générale des Eaux will be updating the information systems, which will allow online management of the whole network, establish a water control quality system, improve water purification techniques, and install instruments to monitor potential leakage and damage.