Welcome to ECA Watch

Export credit agences provide government-backed loans, guarantees and insurance to corporations working internationally in some of the most volatile, controversial and damaging industries on the planet.

Shrouded in mystery, ECAs provide financial backing for risky projects that might never otherwise get off the ground. They are a major source of national debt in developing countries.

ECA Watch is a network of NGOs from around the world. We come together to campaign for ECA reform - better transparency, accountability, and respect for environmental standards and human rights.

Featured publications and stories

What's New January 2018

What's New!" is a periodic update to keep you informed of the latest on the ECA Watch website. What's New! features a wide range of materials related to the reform of Export Credit Agencies (ECAs) including NGO publications and releases, news articles, commentaries and announcements about the policies and practices of ECAs and ECA-financed projects world-wide.

If you would like to receive "What's New!" simply add your e-mail to the ECA-Action list at www.eca-watch.org today!

Questions? Email info-at-eca-watch.org

See all "What's New!" updates since 2005 here.

  • Aussie defence fund a reminder of ECAs’ murky history with the arms industry
  • Australian ECA underwriting arms exports is 'baffling', expert says
  • Turkish, French, Italian firms awarded missile system development project
  • Aramco Seeks Cheap ECA backed loans prior to IPO
  • Asia could attract $250B in coal power investment
  • G20 billions feed Viet Nam's coal-fired future
  • US Ex-Im may back a controversial Vietnamese coal plant
  • Exporters urging Ottawa and EDC to undo uneven application of Russian sanctions
  • Mexican chapter in the Odebrecht saga underscores need to bolster transparency at EDC
  • Does the OECD really support environmentally conscious economic policies?
  • Airbus, Boeing Hopeful on Return of State-Backed Plane Financing
  • China eyes stronger ties with Mekong countries with ECA support
  • Britain cancels plan to forgive North Korean ECA debt
  • Britain doubles ECA backing for India

Aussie defence fund a reminder of ECAs’ murky history with the arms industry

(Global Trade Review, London, 31 January 2018) The Australian export credit agency (ECA), Efic, has been armed with A$3.8bn to help companies sell military equipment overseas. Over the years, ECAs have been heavily criticised for selling arms which often help prop up tyrannical regimes and which can fall into the wrong hands. Indeed, the murky track record of the UK’s ECA was reportedly one of the reasons behind its rebranding from the Export Credits Guarantee Department (ECGD) to UK Export Finance (UKEF). ECGD was found to have funded a succession of arms deals involving despotic regimes including a £49mn loan made to Zimbabwean President Robert Mugabe to buy a fleet of fighter jets and police Land Rovers. Alas, its successor UKEF has continued the trend. It was reported in 2015 to have guaranteed £130mn in financing for repressive governments to spend on arms over the previous years. These include loan guarantees for the Indonesian government to purchase anti-aircraft missiles and a bond guarantee for Saudi Arabia to buy unspecified arms amid Saudi Arabia’s ongoing offensive in Yemen. Over half of UKEF support in the last annual report was for defence... and UKEF is by no means the only ECA involved in funding weaponry. Last year, US Ex-IM was questioned over its funding of dual-use goods which ended up in the militaries of Cameroon, Mexico and Qatar. Last year, the Russian ECA Exiar lent US$100mn to the Armenian government for the purchase of Russian-made munitions and French ECA Coface issued a 50% guarantee on a US$5.9bn loan from a group of French banks to the Egyptian air force to buy 24 multi-role fighter jets built by French company Dassault.

https://www.gtreview.com/news/asia/aussie-defence-fund-a-reminder-of-ecas-murky-...


Australian ECA underwriting arms exports is 'baffling', expert says

(Guardian, Sydney, 30 January 2018) The financial aspects of the Turnbull government’s plan to turn Australia into an arms exporting powerhouse are baffling, a leading defence expert says, but the decision to promote defence products overseas is welcome. Andrew Davies, the Australian Strategic Policy Institute’s director of defence strategy, said the Coalition’s plan to use a $3.8bn fund administered by Australia’s export credit agency to underwrite an expansion of arms exports made little economic sense because manufacturers had no trouble securing funding from private sources. Davies said it was highly unlikely Australia could ever join the ranks of the top 10 arms exporters because the things it was good at producing – component parts for foreign assembly lines; niche sales of intellectual property, and services (training, consultancy, and acquisition)... And it’s unlikely that Australia will be able to produce warships and submarines at less cost than well established shipyards overseas. Peter Whish-Wilson, the Greens defence spokesman, said the plan was designed to shore up a handful of defence industry-centric seats “at the cost of Australia’s soul”.

https://www.theguardian.com/australia-news/2018/jan/31/australian-government-und...


Turkish, French, Italian firms awarded missile system development project

(Daily Sabah, Istanbul, 5 January 201) President Erdoğan's first visit abroad in 2018 was marked by a groundbreaking defense agreement that includes the joint development of missile systems by Turkish, French and Italian firms, among other commercial and economic deals. The Export Credit Bank of Turkey (Türk Eximbank) and Bpifrance Assurance Export also signed a comprehensive business cooperation agreement in France.

https://www.dailysabah.com/defense/2018/01/05/turkish-french-italian-firms-award...


Aramco Seeks Cheap ECA backed loans prior to IPO

(Bloomberg, London, 9 January 2018) Saudi Arabian Oil Co. is seeking a $2 billion loan from Japan’s export-credit agency, three people with knowledge of the matter said, as competition for a role in potentially the world’s largest initial share offering heats up. A deal would make the Japanese export-credit agency the second state institution to extend financing to Aramco ahead of its planned initial public offering -- which the Saudi government has said may value the company at $2 trillion. The U.K. government agreed to a $2 billion loan guarantee for Aramco in November as it competed with the U.S. to host the IPO. The unusually large export-credit guarantee was designed to finance the purchase of British goods but opened the U.K. up to the suggestion that it was trying to influence the decision on where the company should be listed. Aramco also signed an agreement with a group of regional and international lenders for $10 billion of standby revolving-credit facilities in 2015. Mandates on the oil company’s IPO may be finalized as early as this week, with Goldman Sachs Group Inc., Citigroup Inc., JPMorgan Chase & Co., HSBC Holdings Plc and Morgan Stanley said to be among lenders vying for a place on the deal. According to Reuters, Saudi Aramco is working to secure billions of dollars in cheap ECA backed loans from banks before its stock listing and disclosure of its assets raises loan rates. Meanwhile, Abu Dhabi National Oil Co (ADNOC) plans to raise a $3 billion syndicated loan from JIBC, according to a source close to the matter. Such loans aim to help Japanese companies secure oil supplies from Abu Dhabi, as the proceeds are generally used as a form of advance payment to ADNOC for crude oil sales to Japanese oil firms.

https://www.bloomberg.com/news/articles/2018-01-09/aramco-said-to-seek-2-billion...


Asia could attract $250B in coal power investment

(Kallanish Energy, Hammersmith, 5 January 201) With power demand in Southeast Asia expected to grow at roughly 4.6% per year in the next 10-plus years, baseload, low-cost coal-fired generation offers an investment opportunity of $250 billion over the next decade, Wood Mackenzie projects. The challenge though, lies in the financing of such projects, given that institutions, mostly export credit agencies (ECAs) in OECD countries, and European banks, [say they] are reducing their investment support in coal. Instead, they [claim they] will focus on renewables and less-polluting power generation alternatives, Kallanish Energy learns. [However, at the moment, OECD ECAs are funding 12 times as many dollars/euros per year in fossil fuel projects vs renewables.]

http://www.kallanishenergy.com/2018/01/05/asia-could-attract-250b-in-coal-power-...


G20 billions feed Viet Nam's coal-fired future

(Vietnam Net, Hanoi, 18 January 2018) Vietnam is expected to receive loans in the billions of US dollars from some G20 nations for its many coal-fired power projects, helping the capital-thirsty country further ensure its growing demand for power. The US-based Natural Resources Defense Council (NRDC), an international non-profit environmental organisation with over three million members, two weeks ago released a report stating that Vietnam will be the second-biggest borrower from G20 nations for its coal-fired power development. G20’s five largest coal financiers include China, Japan, Germany, Russia, and South Korea.

http://english.vietnamnet.vn/fms/business/194139/g20-billions-feed-coal-fired-fu...


US Ex-Im may back a controversial Vietnamese coal plant

(New York Times, LONG PHU, Vietnam, 26 January 2018) With help from a Kremlin-connected Russian bank, Vietnam is building a coal-fired power plant called Long Phu 1 that will produce an estimated 5.4 million tons of carbon dioxide a year, generating enough electricity to power millions of homes. But the project needs something else first: help from the United States government and the plant’s state-controlled owner has applied for assistance with the project from the Export-Import Bank of the United States. The bank has not yet decided whether it will back the project. If it did, it would show that the Trump administration’s commitment to using more coal at home also extended overseas. Critics say it would also challenge a growing global consensus that developed nations and groups like the World Bank should stop funding high-polluting energy projects in developing countries. Britain’s equivalent of the Export-Import Bank has already declined to participate in the project. In addition, it would provide American backing for a project partly funded by a Russian bank that has endured sanctions by the United States government since 2014 because of Moscow’s military intervention in Ukraine. Several advocacy groups say that PetroVietnam’s environmental due diligence underestimated the project’s likely carbon footprint. They also say the project is not clean enough to meet new guidelines from the OECD which has tried to curb lending by government-owned export credit agencies to certain types of coal projects. By approving the project, the United States would be “thumbing our nose to all the other countries that have striven so hard to reach this agreement,” said Doug Norlen, the director of economic policy at Friends of the Earth USA.

https://www.nytimes.com/2018/01/26/business/exim-bank-vietnam-russia-coal.html


Exporters urging Ottawa and EDC to undo uneven application of Russian sanctions

(Financial Post, Toronto, 11 January 2018) Canadian exporters with long histories of doing business in Russia are urging the federal government to help them compete with foreign rivals that they insist are profiting from Ottawa’s particularly rigid approach to international sanctions. Companies say they’re losing ground because, unlike other countries that have imposed sanctions directed at Moscow, Canada went a step further by removing its export credit agency from the Russian market in 2014. Canadian firms say the vacuum has helped open up new opportunities for competitors from places like the United States, Europe and Japan, where export credit agencies continue to support local businesses with interests in Russia, despite similar sanctions by their governments.

http://business.financialpost.com/pmn/commodities-business-pmn/agriculture-commo...


Mexican chapter in the Odebrecht saga underscores need to bolster transparency at EDC

(Hill Times, Ottawa, 15 January 2018) When allegations emerged last fall that the Mexican president’s 2012 election campaign was funded in part by a subsidiary of the Brazilian construction giant Odebrecht, the news barely made headlines in Canada. But this recent development in the far-reaching Odebrecht corruption scandal should give us pause, because it raises crucial questions about the anti-corruption and disclosure policies of our export credit agency, Export Development Canada (EDC). In December 2012, EDC loaned $300 million USD to Braskem, an Odebrecht subsidiary, for construction of a petrochemical complex in Veracruz, Mexico. Earlier that year, Braskem allegedly paid over $3 million USD in bribes towards President Peña Nieto’s election campaign. In its review this year of the Export Development Act, the government must turn a critical eye to this issue. The review, conducted by the trade minister every ten years, provides a crucial opportunity to enhance the transparency of EDC’s due diligence practices.

https://www.hilltimes.com/2018/01/15/mexican-chapter-odebrecht-saga-underscores-...


Does the OECD really support environmentally conscious economic policies?

(ECA Watch, Ottawa, 31 January 2018) In a recent opinion article, Canadian environmentalist David Suzuki noted that the Secretary-General of the OECD supports environmentally conscious economic policies. Suzuki argued that in Angel Gurria we have one of the world's most influential economists urging dramatic climate action, including a higher, and rising, price on carbon. While Angel Gurria seems to be making appropriate noises about environmentally conscious economic policies, it cannot be assumed that the OECD is doing anything like that or about it. The role of the OECD Export Credit Working Group in promoting fossil fuels above renewable energy belies this flattery. Such OECD public relations statements contradict their on the ground policy and facts. While Carbon prices are part of the issue and might be part of the solution, contradictory actions and OECD ECA finance for 12 times as many fossil fuel projects as renewalbes, undermine them, go counter to them, and are defacto greenwashing.




Airbus, Boeing Hopeful on Return of State-Backed Plane Financing

(Fox Business, Dublin, 22 January 2018) Boeing and Airbus officials have signaled optimism that problems denting their access to government-backed plane financing are nearing resolution. Boeing and Airbus last year both delivered a record number of planes. Though commercial financing for the planes was ample, both Airbus and Boeing are eager to regain access to government-backed credit as an insurance. Some financially weaker airlines need to tap the government-backed financing or the plane makers themselves. Airbus also has been struggling to get backing from its governments for export deals. France, Germany and the U.K. in 2016 suspended financial backing for the plane maker's exports over British Serious Fraud Office concerns that Airbus had failed to fully disclose the use of middlemen in certain transactions. Euler Hermes said at the event that European financial institutions were still establishing a process to assure themselves of Airbus's compliance rules. The U.S. Export-Import Bank, or ExIm, which typically backs Boeing plane exports is affected by the U.S. government's partial shutdown absent a budget agreement. Even before the government shutdown of all-but essential staff, ExIm had been restricted to providing support to deals valued below $10 million because its board lacked sufficient members to approve larger transactions.

http://www.foxbusiness.com/features/2018/01/22/airbus-boeing-hopeful-on-return-s...


China eyes stronger ties with Mekong countries with ECA support

(Xinhua, Phnom Penh, 11 January 2018) China eyes stronger ties with Myanmar, Laos, Thailand, Cambodia and Vietnam, the other five countries along the Lancang-Mekong river, pledging new loans, medical aids and scholarships to its neighbors. At the second Lancang-Mekong Cooperation (LMC) leaders' meeting here, Chinese Premier Li Keqiang announced that China will provide another 7 billion yuan (1.08 billion U.S. dollars) in government concessional loans and also the setup of a 5-billion-dollar credit line for supporting production capacity and equipment manufacturing cooperation among the Lancang-Mekong countries. As an important mechanism along the Lancang-Mekong River sub-region, the LMC mechanism has been focusing on sustainable development and pragmatic cooperation in the sub-region and serving as an important platform for implementing the Belt and Road Initiative.

http://www.xinhuanet.com/english/2018-01/12/c_136889090.htm


Britain cancels plan to forgive North Korean ECA debt

(Yonhap, Seoul, 9 January 22018) The British government has withdrawn its plan to cancel a North Korean debt that has been unpaid for more than four decades, in consideration of the possibility that North Korea could pay it back after the two Koreas are unified, U.S. broadcaster Voice of America reported Tuesday. UK Export Finance (UKEF) decided in May 2013 to stop efforts to recover the debt, Voice of America said, citing data from the export credit agency.

http://english.yonhapnews.co.kr/news/2018/01/09/0200000000AEN20180109007500315.h...


Britain doubles ECA backing for India

(India Times, New Delhi, 11 January 2018) The UK government today announced the doubling of its national credit support for UK businesses exporting to India, during the visit of Commerce and Industry Minister Suresh Prabhu. As part of the deliberations, UK trade minister Liam Fox announced that the UK's national export credit agency, UK Export Finance (UKEF), has more than doubled its financial support to enable UK businesses to trade with India. This means 4.5 billion pounds will now be available for UK companies exporting to India as well as Indian buyers of UK goods and services.

https://economictimes.indiatimes.com/news/economy/foreign-trade/britain-doubles-...


What's New December 2017

What's New!" is a periodic update to keep you informed of the latest on the ECA Watch website. What's New! features a wide range of materials related to the reform of Export Credit Agencies (ECAs) including NGO publications and releases, news articles, commentaries and announcements about the policies and practices of ECAs and ECA-financed projects world-wide.

If you would like to receive "What's New!" simply add your e-mail to the ECA-Action list at www.eca-watch.org today!

Questions? Email info-at-eca-watch.org

See all "What's New!" updates since 2005 here.

  • Inside EDC one of Canada's most secretive agencies
  • Banks criticised for funding coal deals despite Paris agreement
  • Pipeline developer sues social movements
  • The UK arms trade with repressive regimes has no moral or economic sense
  • Turkey to Acquire Four Russian S-400 Missile Divisions with ECA support
  • Lenders jostle for mega PNG LNG financing deal
  • Africa – a new frontier for Floating LNG projects
  • Senate Panel Rejects Trump's Nominee to Lead Export-Import Bank
  • Former Ex-Im Bank Director under investigation for undisclosed foreign agent contract
  • Indonesia - Dirty man of Asia deepens addiction to coal
  • UKEF lines up new delegated supply chain finance (SCF) guarantees
  • An African corridor to prosperity [and coal fired global warming!]
  • Sinopec Signs $1b Iranian Abadan Refinery Expansion Deal
  • Kuwait Seals US$6.245bn ECA-Backed Corporate Transaction

Inside EDC one of Canada's most secretive agencies

(The Walrus, Toronto, 19 December 2017) Export Development Canada lends foreign buyers billions of taxpayer dollars. Critics say it's knowingly banking some of the world's worst regimes.  EDC has perfected the art of lending billions of taxpayer dollars to scandal-ridden foreign buyers. In May 2017, a trove of hundreds of thousands of emails was leaked to the press from an organization belonging to the Gupta family of South Africa. In a lengthy email thread strung out over the course of 2014, it was revealed that Bombardier had negotiated a C$52 million sale of a luxury jet to a Gupta subsidiary, with US$41 million of the jet’s financing provided directly to the Guptas by Export Development Canada, a Canadian Crown corporation. The Guptas are not EDC’s only controversial clients. The agency’s client list is studded with some of the most ­scandal-ridden multinationals on the planet including Kinross Gold whose West ­African mining operations were, as of 2016, under investigation by the United States Securities and Exchange Commission for bribery and corruption. [ECA-Watch member Above Ground has questioned EDC financing for controversial projects such as Omai Gold Mines in Guyana and Petrobas in Brazil, with EDC refusing to comment on the possible illegal or inappropriate use of Canadian tax dollars. Above Ground's 11 December 2017 report on Kinross Gold shows that, among other harms, Kinross’ dramatic expansion of the mine displaced the residents of traditional communities formed over a century ago by former African slaves who have land rights under Brazilian law. The legal process to formalize their collective title was well underway when Kinross announced its expansion plan and Export Development Canada provided financing, forcing them off their land. The report also raises concern about environmental oversight of the mine, which is located within 500 metres of neighbourhoods where hundreds of families live, as well as safety measures to keep people from entering the mine site.]  EDC activities are protected by disclosure protocols that are entirely opaque, with the result that few in ­Canada - including the Minister presiding over it - seem to know the full details about what the agency does, who it finances, and why. With EDC’s mandate up for review in 2018, it seems like a good time to examine the considerable reputational risks the agency often takes. [As well as its compliance with its own international, WTO and OECD agreed due diligence requirements on human rights, environmental standards and corruption.] On December 21, 2017, 2 days after this article was published online, EDC announced that it was suddenly terminating its $41 million loan to the Guptas for the purchase of a luxury Bombardier jet.

https://thewalrus.ca/inside-one-of-canadas-most-secretive-agencies/


Banks criticised for funding coal deals despite Paris agreement

(ECA Watch, Ottawa, 31 December 2017) At the One Planet Summit in Paris in December 2017 a number of NGO, environmental and social movement organizations released briefings and research reports highlighting fossil fuel projects that are being funded by multilateral and national development banks and export credit agencies. The Big Shift global campaign released a briefing titled Dirty Dozen (pdf); complementary reports, ‘Banks vs. the Paris Agreement’ and ‘Investors vs. the Paris Agreement’ (pdf) were launched by Rainforest Action Network, BankTrack, Urgewald, Friends of the Earth France, and Re:Common at the Climate Finance Day in Paris; and the Natural Resource Defense Council released Power Shift: International Coal vs. Renewable Energy Finance.




Pipeline developer sues social movements

(Kallanish Energy News, Greensburg, 18 December 2017) Dakota Access Pipeline developer Energy Transfer Partners (ETP) and Florida-based environmental publication Earth First Journal are arguing in federal court whether something called a “social movement” can be sued. ETP in August filed a lawsuit against enviro-groups Earth First, Greenpeace and BankTrack, alleging they issued false and misleading information about the $3.8 billion pipeline, to move North Dakota crude to Patoka, Ill., interfered with construction, and damaged the company's reputation and finances through illegal acts. The company's lawsuit, filed in federal court in North Dakota, seeks damages that could approach $1 billion, The Associated Press reported.

https://www.kallanishenergy.com/2017/12/18/etp-publication-argue-over-social-mov...


The UK arms trade with repressive regimes has no moral or economic sense

(The Guardian, London, 20 December 2017) As the spectre of Brexit emerges, so do the first meaningful signs of the Tory vision of “building a global Britain”. The Department for International Trade, set up by Theresa May to put some flesh on the bones of her slogan, has prioritised arms sales for Britain’s post-Brexit industrial policy. The DIT, which licences Britain’s exports guns, planes and bombs, has overseen a sharp spike in sales to repressive regimes, many of which it has identified as “priority markets”. The biggest of these is Saudi Arabia, which is using our arms to bomb into famine its political enemies in Yemen. Our arms export control regime clearly states that it is illegal for the government to licence weapons to nations that oppress their own people or violate international humanitarian law. When buyers cannot afford our weapons, the government subsidises loans for them through export credit guarantees; UK Export Finance, which is supposed to support all British exports, says 50% of the support it provides (in the form of loans or guarantees) was given to defence exports.

https://www.theguardian.com/commentisfree/2017/dec/20/uk-arms-trade-no-moral-or-...


Turkey to Acquire Four Russian S-400 Missile Divisions with ECA support

(Prensa Latina, Moscow, 28 December 2017) Turkey will acquire, for 2.5 billion dollars, four divisions of the modern Russian S-400 surface-to-air missile divisions, which will be delivered in 2020. The finance ministries of Turkey and Russia have concluded negotiations for the granting of an export credit to Ankara, Chemezov head of the Russian state conglomerate Rostec said. Turkey will pay an advance equivalent to 45% of the total and the Russian side will grant an export credit that will cover the other 55% of the contract. Ankara [a NATO member] received strong criticism and even threats from the United States for its decision to acquire the Russian arms. In other Russian ECA news, four Iranian banks have signed an "unlimited finance deal" with the Eximbank of Russia for public and private sector approved projects using Russian technical and engineering services.

http://www.plenglish.com/index.php?o=rn&id=22657&SEO=turkey-to-acquire-four-russ...


Lenders jostle for mega PNG LNG financing deal

(Australian Financial Review, Sydney, 5 December 2017) Key project debt lenders have been giving their passports and travel insurers a workout as they troop up to Papua New Guinea to get to grips with what could be the region's biggest financing since the record US$20 billion deal for Ichthys LNG. While the final configuration of the next stage of LNG expansion in PNG is yet to be settled, those behind the circa US$17 billion project - primarily ExxonMobil, Total and Oil Search - are already well advanced. In considering funding export credit agencies are again expected to be well in evidence, while the backing of two oil majors and the sheer size of the project count in favour of commercial lender interest.

http://www.afr.com/street-talk/local-lenders-jostle-for-mega-png-financing-deal-...


Africa – a new frontier for Floating LNG projects

(LNG Worldshipping News, London, 4 December 2017)) Floating LNG (FLNG) is opening new offshore gas basins for LNG development in Africa. The ownership structure of Africa’s new LNG production and the willingness of international oil companies to deploy new technologies will drive the commoditisation of LNG and cement its growing role as such in the global trading of energy. Uniquely, FLNG vessels will provide the first liquefaction plants in Mozambique and Cameroon and the technology is also expected to lead an expansion of capacity in Equatorial Guinea, Senegal and Mauritania. Italy’s Eni and its partners took a final investment decision on the 3.4M tonnes a year (mta) Coral FLNG scheme off Mozambique in June 2017. The project will be the first of this type to have as much as 60% of its cost funded on a project-finance basis, backed by 15 international banks and guaranteed by five export credit agencies. The financing was provided in the form of covered loans from five export credit agencies (Italy's Sace, China's Sinosure, Japan's Ksure, South Korea's Kexim, and Portugal's BPI) and two direct loans (one provided by Kexim, the other by an unnamed 'commercial bank').

http://www.lngworldshipping.com/news/view,africa-a-new-frontier-for-flng_49905.h...


Senate Panel Rejects Trump's Nominee to Lead Export-Import Bank

(New York Times, Washington, 19 December 2017) Two Republican senators broke with their party to block President Trump’s nominee to lead the Export-Import Bank, a setback for the White House that reflects deep divisions in the Republican Party over the role that the government should play in steering the United States economy toward prosperity. The nominee, Scott Garrett, a former representative and a Republican from New Jersey who had wanted to see the government’s export credit agency shuttered, was rejected by the Senate Banking Committee in a 13-to-10 vote. Since 2015, the agency has been hobbled by a lack of personnel necessary to approve projects over $10 million, formerly the bulk of the agency’s work. An estimated $42.2 billion worth of deals are stuck in the pipeline waiting for approval, which could support an estimated 250,000 American jobs, a spokeswoman for the Export-Import Bank said. Some of the biggest Ex-Im customers are General Electric, Boeing and Caterpillar, Some senators and the Trump administration have threatened to pull the other board nominees, leaving the bank without a quorum and barred from financing deals over $10 million and Boeing to fend for itself. However, in 2017 the Aircraft Finance Insurance Consortium has supported more than $1 billion of new airplane deliveries and Boeing has 661 firm orders for 2018, in addition to 6,600 backorders. Meanwhile it has been said that Boeing is upset that Garrett was getting help throughout the nomination process from Dan Murphy, a lobbyist for a high-powered Washington firm that counts Airbus among its clients.

https://www.nytimes.com/2017/12/19/us/politics/republicans-senate-export-import-...


Former Ex-Im Bank Director under investigation for undisclosed foreign agent contract

(Newsweek, Washington, 20 June 2017) Federal investigators probing the lobbying work of ousted national security adviser Michael Flynn are focused in part on the role of Bijan Kian, Flynn’s former business partner, according to a person interviewed by the FBI. In private conversations with potential clients, Kian portrayed himself as a rainmaker for Flynn, tapping into connections cultivated during a five-year tenure as a director at the U.S. Export-Import Bank, according to one person who worked with the firm. Inovo, a Netherlands-based company controlled by Turkish businessman Ekim Alptekin, hired Flynn Intel Group to research Fethullah Gulen’s activities in the United States, which he suspected were “poisoning” relations between the United States and Turkey. Like Turkey's President Tayyip Erdogan, Alptekin blamed the coup on followers of Gulen. Kian played a central role in securing and overseeing the Inovo contract, two people with knowledge of that project said. The FBI has been investigating whether Flynn’s consulting firm lobbied on behalf of Turkey - after being paid $530,000 by Inovo - without making the proper disclosure under the Foreign Agents Registration Act.

http://www.newsweek.com/flynn-trump-russia-investigation-turkey-bijan-kian-gulen...


Indonesia - Dirty man of Asia deepens addiction to coal

(The Nation, Bangkok, 30 December 2017) Already the world’s fifth-biggest greenhouse gas emitter,  Indonesia is leading Southeast Asia’s boom in coal-fired power. Already one of the world’s biggest carbon polluters because of deforestation, Indonesia has back-pedalled on a pledge to cap coal production. The government initially planned to reduce its coal production to 413 million tonnes this year, from 419 million tonnes in 2016. The figure was expected to fall to 406 million tonnes next year, before hovering at only 400 million from 2019. However, this year’s coal production has already reached 477 million tonnes, far outstripping last year’s 434 million tonnes. The boom is being bankrolled by foreign governments and banks, the Guardian reports. Activist group Market Forces examined 22 deals involving 13.1 gigawatts of coal-fired power in Indonesia and found that 91 per cent of the projects had the backing of foreign governments through export credit agencies or development banks. The majority of the money was coming from Japan and China, with the Japan Bank for International Cooperation involved in five deals and the Export-Import Bank of China involved in seven deals.

http://www.nationmultimedia.com/detail/opinion/30335079


UKEF lines up new delegated supply chain finance (SCF) guarantees

(Global Trade Review, London, 7 December 2017) UK Export Finance (UKEF) has announced plans for a new invoice financing scheme for exporters in a bid to boost exports through supply chain efficiency. GTR has learned that the new scheme will allow an exporter to set up a supply chain discounting facility with its bank, through which suppliers can receive up to 95% of their payment on invoice submission. The facility will be based on an export contract and support will be based on the buyer’s creditworthiness. UKEF will provide the bank with a guarantee for up to 80% of the amount of credit provided through the facility. The finer details of the scheme, which is due to be launched next year, are still being ironed out. Earlier in the year, the export credit agency (ECA) launched the Bank Delegation scheme, which gives banks authority to issue UKEF guarantees for their customers simply by telling UKEF they are issuing the guarantee based on the banks' own due diligence. [How UKEF will ensure compliance with its own international, WTO and OECD agreed due diligence requirements on human rights, environmental standards and corruption is not clear under this delegation of responsibility to private sector banks.]

https://www.gtreview.com/news/europe/ukef-lines-up-new-scf-scheme-2/


An African corridor to prosperity [and coal fired global warming!]

(African Law & Business, London, 7 December 2017) London's Linklaters & US firm White & Case, together with local law firms, have shared the plaudits in agreeing financing of the US$4 billion Nacala Corridor rail and port project, which spans Mozambique & Malawi. It involves Brazil's Vale & Japan's Mitsui and will enable the construction, refurbishment and operation of nearly 1000 kilometres of railway line, as well as the construction and operation of a coal terminal in the port of Nacala, linking Vale’s coal project in Tete Province, in western Mozambique home to some of the world’s richest remaining coal deposits, with a deep sea port to be constructed in Nacala – the so-called Nacala Corridor, in eastern Mozambique. Banks involved in the deal, who were advised by Linklaters, included the African Development Bank (AfDB), Export Credit Insurance Corporation of South Africa (ECIC), Japan Bank for International Cooperation (JBIC) and Nippon Export and Investment Insurance (NEXI) together with ECIC and NEXI covered commercial banks.

https://www.africanlawbusiness.com/news/7797-a-corridor-to-prosperity


Sinopec Signs $1b Iranian Abadan Refinery Expansion Deal

(Financial Tribune, Tehran, 30 December 2017) China's Sinopec Engineering Company has signed a deal worth $1 billion to develop Abadan Oil Refinery, Iran's oldest crude processing facility in the southern oil-rich Khuzestan Province, the Chinese oil and gas group announced. According to Iranian officials, the venture will be financed by China Export and Credit Insurance Corporation, or Sinosure. The funding is reportedly part of a deal worth $3 billion to overhaul and expand the facility. Sinosure is China's major state-owned export credit insurance company. Its financing since its establishment in 2001 has totaled $290 billion for exports and investments. Commissioned in 1912, Abadan refinery is the longest-running Iranian crude refinery and once the largest oil refinery in the world.

https://financialtribune.com/articles/energy/78896/sinopec-signs-1b-abadan-refin...


Kuwait Seals US$6.245bn ECA-Backed Corporate Transaction

(Bonds & Loans, London, 5 December 2017) Kuwait National Petroleum Company’s (KNPC) US$6.245bn ECA-backed loan was a triumph for the company’s Clean Fuel Project and the region’s credit markets, setting a new record for the largest ECA-backed corporate loan to date. The Project involves modernisation of the Mina Al Ahmadi and Mina Abdullah oil refineries of KNPC located in Al Ahmadi Governorate, south of the country, to make their products meet stringent environmental requirements. Total debt financing for the Project is estimated to be around US$10bn. The financing package is supported by 7 ECAs: Atradius Dutch State Business N.V., Export-Import Bank of Korea (KEXIM), the Japan Bank for International Cooperation (JBIC), Korea Trade Insurance Corporation (K-Sure), Nippon Export and Investment Insurance, SACE, and UK Export Finance. JBIC and KEXIM extended direct financing to KNPC while the other agencies provided cover to commercial bank lenders involved in the transaction.

http://www.bondsloans.com/news/article/1471/case-study-knpc-seals-usd6245bn-loan...


What's New November 2017

What's New!" is a periodic update to keep you informed of the latest on the ECA Watch website. What's New! features a wide range of materials related to the reform of Export Credit Agencies (ECAs) including NGO publications and releases, news articles, commentaries and announcements about the policies and practices of ECAs and ECA-financed projects world-wide.

If you would like to receive "What's New!" simply add your e-mail to the ECA-Action list at www.eca-watch.org today! Questions?

Email info-at-eca-watch.org

See all "What's New!" updates since 2005 here.

  • Brussels Seminar December 4: Transparency and due diligence at Europe’s ECAs
  • OECD, It’s Time for Export Credit Agencies to Stop Funding Fossil Fuels
  • Too Coal-Hearted: Japan and Korea’s Support for Dirty Energy
  • Japanese Groups Strongly Object to JBIC Premature Loan Disbursement, Ingoring Upcoming Community Lawsuit
  • Japanese banks & JIBC back coal links between Japan & Africa
  • May Vies With Trump for Aramco Listing with ECA support
  • Airbus braces for a difficult landing after corruption allegations
  • Great Barrier Reef Pitted Against Coal Jobs in Australia Vote
  • ECAs are stepping up their SME support initiatives.

Brussels Seminar December 4: Transparency and due diligence at Europe’s ECAs

(CEE Bankwatch Network, Prague, 22 November 2017) In 2015-2017 Finance & Trade Watch and CEE Bankwatch Network together with its national partners researched export credit agencies (ECAs) in seven countries of the European Union (Austria, Czech Republic, Croatia, Hungary, Poland, Romania and Slovakia). The results of this research will be presented at a seminar in Brussels on December 4, 2017 at the Leopold Hotel  19:00 - 20:30 followed by a reception.

  • Opening remarks by Heidi Hautala, vice President of the European Parliament
  • Remarks on the position of European Parliament by Anna Záborská, Member of the EP Development Committee
  • Reflections on the issues of EU Member states ECAs by Silvia Gavorníková, EXIMBANKA Slovakia
  • Introduction of the research project by Thomas Wenidoppler, Finance and Trade Watch
  • Issues and Recommendations related to Transparency and Due Diligence of ECAs by Dana Mareková, CEE Bankwatch Network

To participate, register here




OECD, It’s Time for Export Credit Agencies to Stop Funding Fossil Fuels

(Friends of the Earth US, Washington, 14 November 2017) Precisely as the world’s attention is focused on addressing climate devastation at the 23rd United Nations Climate Conference (COP23) in Bonn, Germany, the largest public drivers of fossil fuel financing are meeting a mere 320 miles away in Paris. The irony couldn’t be starker. Representatives of the very same countries singing their own praises in Bonn are fomenting climate disaster from Paris, at a meeting of export credit agencies (ECAs) at the Organization of Cooperation and Development (OECD) Export Credit Group. Export credit agencies (ECAs) — which are bodies funded by taxpayers to support business overseas — are world leaders in public support for climate destruction. While relatively obscure but powerful institutions, ECAs provide government-backed loans, guarantees, insurance, and credits to projects overseas — including many energy projects — in the hopes of boosting their home countries’ exports and creating and maintaining jobs. According to a recent report by Friends of the Earth U.S. and Oil Change International, ECAs fund almost $40 billion worth of fossil fuel projects each year. That is a whopping 12 times more than what they spend on clean energy projects.

https://medium.com/@foe_us/oecd-its-time-for-export-credit-agencies-to-stop-fund...


Too Coal-Hearted: Japan and Korea’s Support for Dirty Energy

(Natural Resources Defense Council, New York, 13 November 2017) Two years ago, OECD countries agreed to place limits on coal finance. Are countries following through on their commitments? The results are mixed. Most governments have stopped financing coal and shifted finance to clean energy projects. The worst actors, Japan and Korea, are continuing to provide billions for coal projects. Continued government financing for international coal projects undermines the Paris Agreement and the prospects of a low-carbon future. To address climate change, governments must shift international public finance toward smarter, sustainable options such as solar and wind power.

https://www.nrdc.org/experts/han-chen/too-coal-hearted-japan-and-koreas-support-...


Japanese Groups Strongly Object to JBIC Premature Loan Disbursement, Ingoring Upcoming Community Lawsuit

(FOE Japan, Tokyo, 14 November 2017) On November 14, The Japan Bank for International Cooperation (JBIC) disbursed the first installment of a loan for the 1000 MW Cirebon coal-fired power plant expansion plan which Marubeni and JERA invested in, known as Cirebon 2. The total loan amount JBIC has signed in the loan agreement is around USD 731 million. However, the validity of the new environment permit, which has only recently been issued, is still in question. The local community and NGO groups, which are opposing the project, are preparing to file an administrative lawsuit next week, demanding the revocation of the new environment permit. This would make it impossible for the Cirebon 2 project to violate the laws of the host country (Indonesia) and the “JBIC Guidelines for Confirmation of Environmental and Social Considerations”. This disrepectful JBIC neglect of the lawsuit by local residents is a repeat of its conclusion of the loan agreement without an adequate EIA. JBIC had a meeting with the local community and NGO groups in Indonesia last October and directly heard their concerns and the judicial risks. Nevertheless, JBIC decided to disburse the loan and just push through with the project ignoring their concerns.

http://www.foejapan.org/en/aid/171114.html


Japanese banks & JIBC back coal links between Japan & Africa

(Global Capital, London, 1 November 2017) Japan Bank for International Cooperation (JBIC) and a syndicate of lenders have provided a $2.73bn loan to finance the construction of a railway and upgrade a port in Mozambique, which will ensure the long term supply of coal to Japan from the African country. JBIC provided $1.03bn of the deal with the rest provided by African Development Bank, Sumitomo Mitsui Banking Corporation (SMBC), Mizuho, Standard Chartered, Nippon Life Insurance Co, MUFG and Sumitomo Mitsui Trust Bank.

http://www.globalcapital.com/article/b15v74t296bqjc/japanese-banks-back-coal-lin...


May Vies With Trump for Aramco Listing with ECA support

(Bloomberg, London, 29 November 2017) U.K. Prime Minister Theresa May said London is “extremely well-placed’’ to win a planned stock exchange listing by Saudi Arabia Oil Co., as she competes against U.S. President Donald Trump for the coveted initial share sale by the world’s largest crude producer. Aramco, worth trillions, is mulling an international sale in addition to a listing on the Saudi exchange. Trump earlier this month tweeted his hope that the Saudis would use a U.S. exchange, before lobbying Saudi King Salman personally on a phone call. The UK government earlier this month agreed to a $2 billion loan guarantee, an unusually large export credit guarantee that’s designed to finance the purchase of British goods, but that also opened May up to the suggestion she was trying to influence the listing decision.

https://www.bloomberg.com/news/articles/2017-11-29/may-vies-with-trump-for-aramc...


Airbus braces for a difficult landing after corruption allegations

(Guardian, London, 5 November 2017) A UK Serious Fraud Office probe into allegedly misleading statements made by Airbus to UK Export Finance, the government department that provides commercial support for major deals has ballooned with further allegations of corruption. The investigation concerns whether Airbus lied to the government about its use of intermediaries. It is understood that Airbus has not received any further support from UKEF since it was informed of the allegations in April last year. Der Spiegel has published a lengthy investigative piece alleging that Europe’s largest aerospace multinational had operated a London slush fund, distributing millions of dollars to accounts held by companies in tax havens. Before the month was out, the firm would reveal to investors that it had reported itself to authorities in the US, this time over potentially breaching regulations on the use of agents to sell sensitive weapons technology.

https://www.theguardian.com/business/2017/nov/04/airbus-year-corporate-confessio...


Great Barrier Reef Pitted Against Coal Jobs in Australia Vote

(ABC, Sydney, 22 November 2017) As the world grapples with the fossil fuel’s role in the future energy mix, Indian bilionaire Guatam Adani's proposed Carmichael coal mine became a defining issue in Australia's Queensland election. An unnamed Adani Mining director was quoted as saying the company is close to securing a deal with Chinese enterprises and export credit agencies to fund both the mine and the rail link, and that Adani wouldn’t need a loan of up to $1 billion from the federal Northern Australian Infrastructure Facility (NAIF) for the rail line. A formal announcement about the financing deal is said to be imminent, but the ABC reports that reliance on funds from Chinese enterprises and export credit agencies could cost Australia jobs associated with the project. Such Chinese interests invariably require that materials for key infrastructure are sourced from China and that effective shifts work out of Australia. Coal and the impact of climate change on Australia's Great Barrier Reef were an issue in the election.

https://www.bloomberg.com/news/articles/2017-11-21/great-barrier-reef-pitched-ag...


ECAs are stepping up their SME support initiatives.

(TXF News, London 23 November 2017) Application processes and ease of access to export cover is improving. But as commercial banks retreat from the SME loans market, more ECA direct lending to SME exporters is a must. Many export credit agencies (ECAs) have been, or are in the process of, stepping up their support for small and medium sized enterprises (SMEs). Finnvera, Credendo, Atradius, Sace, EFIC and Euler Hermes already have streamlined services specifically targeted at SME customers. UKEF has entered into partnerships with five commercial banks – Santander, Barclays, Lloyds, Natwest/RBS, and HSBC – to allow customers to access export finance from commercial bank branches. And Bpifrance hopes to create a one-stop-shop for exporters to increase accessibility. But for all the initiatives, meeting the very different needs of the majority of SMEs remains elusive. For example, UKEF has introduced capacity to provide funding in 40 local currencies. In short – the needs spectrum of SMEs is so broad that ECAs are in the difficult position of trying to 'please all of the people all of the time'.

https://www.txfnews.com//News/Article/6308/tmp


Pages