Case Study: $4.7M in Construction Guarantees for a Major Wastewater Treatment Project in Central Asia Issued in Just 7 Days

Introduction

In large-scale infrastructure projects, construction companies often need to provide financial guarantees to demonstrate reliability and commitment. These guarantees help satisfy the employer’s risk management needs, especially when substantial prepayments or performance benchmarks are involved. Infrastructure development projects, especially those in the public utility sector, require not just capital and expertise but also robust financial backing to ensure project security and stakeholder confidence. A client from Central Asia reached out to Trade Finance Company to provide essential financial guarantees required under a significant public works contract. With construction schedules and public services on the line, speed and precision were critical.

The guarantees were required for the successful execution of a major public infrastructure project: the Construction of a Wastewater Treatment Plant (WWTP) in Central Asia. The existing facility in the area is currently non-operational. This project aims to transform the outdated site into a modern WWTP capable of processing up to 20,000 m³ of wastewater per day, ultimately delivering centralized, reliable wastewater services to an estimated population of 100,000 residents in the region.

Time was critical: the project schedule demanded prompt issuance of the instruments to prevent delays in mobilization and execution.

Challenges

The client faced several key challenges:

• Compliance with Contractual Terms: The construction contract required both an advance payment guarantee and a performance guarantee to be issued before mobilization could begin.

Time Constraints: Issuance needed to occur within a tight timeframe to align with funding and operational deadlines.

• Multiple Draft Revisions: Both guarantees required multiple rounds of revisions to meet both employer and local compliance standards.
• Coordination of Dual Instruments: Issuing two separate instruments in parallel required close coordination and real-time communication between all stakeholders.

Solutions

To meet the client’s requirements, Trade Finance Company developed a three-pronged solution:

• Instrument Structuring: We customized an Advance Payment Guarantee of $3,160,402.94 and a Performance Guarantee of $1,580,201.47, ensuring both complied with international banking norms and the specific requirements of the project employer.
• Rapid Coordination: By working in tandem with Asia Nexus and legal counsel, we aligned the drafts with all regulatory and contractual obligations across several rounds of revision.
• Secure Issuance Framework: All instruments were processed through established banking channels, ensuring transparency, traceability, and full compliance.

Solution Implementation

The process began with initial drafts provided by the beneficiary bank, which kicked off a collaborative review and revision period. Between April 10 and May 20, 2025, multiple revised drafts of both the Advance Payment Guarantee and the Performance Guarantee were exchanged to ensure full alignment with the client’s contract terms and the employer’s requirements. On May 22, 2025, the signed drafts were received, followed by proof of the pre-issuance fee on May 23, with payment clearing into the account by May 27. The final documents were then sent for issuance on May 29, and by May 30, 2025, both relayed copies of the financial guarantees were successfully delivered to the client — completing the entire transaction within just 7 days from payment receipt.

Results

By the end of the 7-day execution period, the client had in hand:
• A $3,160,402.94 Advance Payment Guarantee
• A $1,580,201.47 Performance Guarantee
These results delivered immediate and long-term benefits:

• Transaction Completed in 7 Days: Both guarantees were issued within a week of receiving payment, enabling the project to proceed on schedule.
• Full Compliance Achieved: Instruments were accepted by the employer without further modification, reflecting the accuracy and quality of documentation.
• Support for a High-Impact Public Project: The client secured the necessary financial backing to begin construction on a facility that will improve sanitation infrastructure for over 100,000 people.
• Strengthened Credibility: The timely issuance and compliance of the guarantees strengthened the client’s position with the employer and enhanced their profile for future tenders.

Discussion

This case demonstrates how well-coordinated financial structuring and expertise in trade instruments can make or break complex project timelines. Whether for public infrastructure or private development, guarantees like these serve as vital tools for securing trust, managing risk, and enabling project financing.

Trade Finance Company’s ability to issue two large instruments under tight deadlines showcases our commitment to helping clients deliver results — even under pressure.

Conclusion

This case highlights Trade Finance Company’s role as a trusted partner in facilitating complex, high-stakes infrastructure projects. By delivering both an Advance Payment Guarantee and a Performance Guarantee within just 7 days, we empowered our client to meet contractual obligations and initiate a transformative wastewater treatment project in Central Asia. Our expertise, speed, and attention to detail ensured the success of this mission-critical transaction.