Index for June 2012

Volume , Issue

  • OECD's ECG lags in reporting on ECA activities

    (ECA Watch, Ottawa, 30 June 2012) The OECD's Export Credit Division last released overall ECA activity statistics up to 2005 in January 2007. OECD staff have argued that difficulties in standardizing their databases for activities, operating costs and cash flows have prevented the issue of these statistics, which provide at least a modicum of transparency to taxpayers following OECD ECAs' respect for regulations and commitments to monitor environmental and social standards in their lending and risk insurance. OECD staff have even noted privately that there are some ECAs which still do not want too detailed reporting as they don't wish to reveal certain data about different "windows" of their portfolios. 

    This apparent weakness in statistical reporting and transparency could also be seen as problematic with respect to the WTO's dependence on OECD data to ensure respect for the "safe haven" clause of the WTO's Agreement on Subsidies and Countervailing Measures (ASCM), intended to insure that  ECA  activities do not constitute subsidies by charging “premium rates that are inadequate to cover the long-term operating costs and losses of the programmes.”
     

    In October 2006, ECA Watch noted: 



    "The OECD prides itself in providing members with accurate and comprehensive publications and statistics. In it’s own words, “It helps governments to ensure the responsiveness of key economic areas with sectoral monitoring.” But a review of published statistics covering the expenditure of member countries of over US$104 Billion a year on official, taxpayer funded export credits, raises serious issues of major discrepancies, sloppy presentation and a general reluctance to fully account for the use of large sums of money, sums which greatly exceed official development assistance and the budgets of all the multilateral development banks."

     


    Despite the apparent persistence of these accounting (and accountability) issues, the U.S. Export Import Bank in it's 2011 Competitiveness Report (pdf), nevertheless was able to provide data from other OECD ECAs on thermal power plant and renewable energy notifications, indicating that this data is available to them, presumably from the OECD, despite the latter's delays in publishing them.

Volume 11, Issue 6

  • (Reuters, Washington, 25 June 2012) U.S. exports could suffer unless a new international agreement is reached to rein in the growing portion of government export financing that is happening outside agreed-upon OECD and WTO rules, says Fred Hochberg, head of the U.S. Export-Import Bank, whose credit exposure cap was recently increased last month to $140 billion from $100 billion, despite opposition from Republicans and other right-wing US opponents.
  • (ECA Watch, Ottawa, 30 June 2012) The OECD's Export Credit Division last released overall ECA activity statistics up to 2005 in January 2007. OECD staff have argued that difficulties in standardizing their databases for activities, operating costs and cash flows have prevented the public issue of these statistics. OECD staff have even noted there are some ECAs which still do not want too detailed reporting, as they don't wish to reveal certain data about different "windows" of their portfolios. In October 2006, ECA Watch noted that, while the OECD prides itself in providing accurate and comprehensive publications and statistics, a review of their ECA statistics raised serious issues of major discrepancies. Some 6 years later, the US ExIm Bank's 2011 Competitiveness Report provides data which seems to indicate these OECD statistics do exist, despite their long delays in developing adequate accounting practices and their public dissemination.
  • (Irish Independent, Dublin, 16 June 2012) Ireland's €5.6bn trade with Spain risks being damaged as the export credit market destabilises in the face of Spain's worsening economic difficulties, the Irish Exporters' Association (IEA) has warned. IEA chief executive John Whelan said that many Irish firms that export to Spain rely on export credit insurance to cover the risk of default in payments from their customers there. "As has been the case in Greece since the beginning of the sovereign debt crisis there, Irish exporters have seen normal commercial credit insurance withdrawn," he added.
  • (Wall Street Journal, Athens, 5 June 2012) Greek retailers and small businesses are starting to see select items disappear from store shelves as a widening credit squeeze weighs on importers. Germany's Euler Hermes and France's Coface, said they won't offer new insurance cover for exporters shipping goods to Greece as they find it increasingly difficult to price such cover  amid worries that the country may quit the euro zone.
  • (Bloomberg, Beijing, 12 June 2012) China’s economy expanded 8.1 percent last quarter, the slowest pace in almost three years, and the government cut interest rates for the first time since 2008 last week. China Eximbank plans to use the proceeds from its sale to fund yuan export credits and for general corporate purposes, one of the people said today. China Eximbank and Agricultural Development Bank raised a total of 9 billion yuan in Hong Kong this year
  • (Hindu Business Line, New Delhi, 18 June 2012) The Reserve Bank of India’s move to increase the export credit refinance limit is expected to increase lending to exporters in the micro, small and medium enterprises (MSME) segment. The RBI in its mid-quarter monetary policy review on Monday had enhanced the eligible limit of the Export Credit Refinance (ECR) facility for scheduled banks (excluding regional rural banks) from 15 per cent of the outstanding export credit eligible for refinance, to 50 per cent.
  • (NASDAQ, St. Petersburg, 29 June 2012) OAO Sberbank (SBER.RS), Russia's largest lender, on Wednesday signed a memorandum of understanding with the Export-Import Bank of the U.S. to jointly support up to $1 billion in U.S. exports to Russia by 2014, the lenders said in a press release.
  • (Bloomberg, Ankara, 27 June 2012) The Export Credit Bank of Turkey, a state-owned lender that provides loans for exporters, boosted a loan to 224 million euros ($280 million) after banks provided more money than originally sought, according to a statement from lenders. The one-year facility pays interest of 120 basis points, or 1.2 percentage points, more than the euro interbank offered rate and will be used to fund the exports of the bank’s clients, according to the statement. The Ankara-based bank, known as Turk Eximbank, originally sought 125 million-euros. Bank of Tokyo-Mitsubishi UFJ Ltd., Commerzbank AG, Deutsche Bank AG, ING Groep NV, Standard Chartered Bank, Turk Ekonomi Bankasi A.S. and Mizuho Corporate Bank Ltd., were among the 14 lenders in the so-called club loan, according to the statement.