Dubai’s Roads & Transport Authority (RTA) plans to raise $2.5bn by the end of this year to fund the construction of the Route 2020 metro link. The line will connect to the Expo site in the Jebel Ali area.

“I hope it will be before the end of this year as we have started construction,” news agency Reuters quoted Mattar al-Tayer, chairman and director-general of the RTA, as saying.

He said the government had already made an advance payment of AED600m ($165m) to the consortium of contractors that won the deal to build Route 2020 in June 2016. The team includes France’s Alstom, Spain’s Acciona and Turkey’s Gulermak.

In August, MEED reported that Dubai’s Department of Finance had been tasked with arranging the financing and that it was speaking to banks for the commercial loan tranche.

The project, which will cost about $2.9bn, will have a debt component of $2.5bn, of which about $1.5bn is backed by export credit agencies (ECAs) and the rest by a commercial loan.

The agencies backing the financing are France’s Coface and Spain’s Compania Espanola de Seguros de Credito a la Exportacion (CESCE), according to the news report, which added that the commercial loan has a 10-year tenor, while the ECA-backed financing has a maturity of about 18 years.

The commercial part of the financing is likely to be priced between 200 and 230 basis points over the London interbank offered rate (Libor), while the ECA-backed financing is expected to offer about 150 basis points over Libor.

Route 2020 involves building a 15-kilometre-long line branching off the existing Red Line at the Nakheel Harbour & Tower station, between the Ibn Battuta Mall and Jumeirah Lake Towers stations. The line will also connect to Al-Maktoum International airport. About 11km of the line will be elevated, with five elevated stations and two underground stations.