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.

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What's New December 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.

  • Industry group lobbies Ottawa for EDC insurance against First Nation rights consultations
  • Ottawa offers $1.6B EDC backstop for energy sector as political tensions with Alberta fester
  • MPs to examine environmental impact of UKEF
  • China and US DFIs/ECAs to battle for influence in African infrastructure lending
  • Right problem – wrong solution: The Chinese ECA threat to the multilateral official finance system
  • China's unbridled export of coal power imperils climate goals
  • TDB rolls out SME programme for women-led businesses in six African countries
  • Australia's secret arms deals with nations fighting Yemen's bloody war
  • Philippines edges towards procurement of Turkish combat helicoper
  • Mexico’s Pemex Targets Bank, ECA-Backed Financing in 2019
  • Boeing Sees More Growth in Aircraft Financing Demand
  • Brazil Freezes ECA Credit After Defaults From Cuba & Venezuela
  • BBVA signs first green-certified credit with cover from Spanish ECA
  • Saudi ECA supports Pakistan economy
  • Peru closes largest-ever ECA financing for state energy company
  • Developing countries biggest installers of renewables

Industry group lobbies Ottawa for EDC insurance against First Nation rights consultations

(Globe and Mail, Toronto, 25 December 2018) Canada’s largest industry and trade association has asked the federal government to insure foreign investors against the risk their projects might be derailed by [mandatory] consultations with First Nations. The suggestion from Canadian Manufacturers & Exporters, which represents 1,200 companies, was among the farthest-reaching in hundreds made to a once-a-decade federal review of the Export Development Act, which governs the activities of Canada’s export credit agency. Successive court decisions have affirmed the federal government’s duty to consult Indigenous peoples when its actions may adversely affect their rights, and accommodate them if necessary. This still-evolving body of law has imposed significant responsibilities on governments across Canada relating to Crown-sponsored mining, energy, infrastructure and other projects, as well as private-sector projects that require government regulatory approvals. Disputes over the adequacy of consultations can lead to litigation and projects can grind to a halt. “To a foreign investor who does not understand these complex consultative processes, and has no real way of participating in them, it presents a high risk that dissuades their investment in projects,” Canadian Manufacturers & Exporters wrote in its submission. “EDC, who could be better positioned to understand such situations, could provide assurances to the foreign investor through some sort of guarantee.”  Canada's Assembly of First Nations said in a statement. “If Export Development Canada considers providing guarantees and other assurances to foreign investors to secure investment in projects, Canadian taxpayers may be left on the hook for paying compensation for projects that do not proceed due to faulty consultation processes.” [ECA-Watch commentary: It would appear that Canadian business wants EDC, an official public corporation, to guarantee private foreign investors' profits from potential violations of First Nations' rights.]

https://www.theglobeandmail.com/canada/article-business-group-lobbies-ottawa-for...


Ottawa offers $1.6B EDC backstop for energy sector as political tensions with Alberta fester

(CBC News, Ottawa, 18 December 2018) The federal government is promising more than $1.6 billion — most of it in loans —  to support the ailing energy sector, but it's unlikely to ease the heightened political tension between Ottawa and Alberta. Natural Resources Minister Amarjeet Sohi and International Trade Diversification Minister Jim Carr made the announcement in Edmonton this morning. The bulk of the money — $1 billion in commercial support — comes from Export Development Canada, the national export credit agency. It's meant for oil and gas exporters who want to invest in new technologies and diversify their markets.

https://www.cbc.ca/news/politics/energy-sector-package-sohi-1.4950619


MPs to examine environmental impact of UKEF

(EDIE, West Sussex, 3 December 2018) The [Parliamentary] Environmental Audit Committee (EAC) has launched an inquiry into the sustainability efforts being made by UK Export Finance (UKEF), following claims that the body's financing of fossil fuels overseas is at odds with the aims set out in the UK's Clean Growth Strategy. The Department has come under fire in recent years, with WWF arguing that the greenhouse gases (GHGs) emitted by the projects it supports in developing nations are inconsistent with wider UK policies on decarbonisation. Indeed, UKEF is estimated to have provided an average of £551m in support of fossil fuel production overseas each year between 2014 and 2016 – accounting for 99.4% of all financial support offered for energy projects over the three-year period.

https://www.edie.net/news/6/MPs-to-examine-environmental-impact-of-UK-s-export-c...


China and US DFIs/ECAs to battle for influence in African infrastructure lending

(Infrastructure News, Johannesburg, 3 December 2018) The battle for influence on the continent between Development Finance Institutions (DFIs) and Export Credit Agencies (ECAs) from China and the United States is set to heat up over the next decade in a fierce competition that could help Africa bridge its vast infrastructure gap faster than expected. This is according to new research from global law firm Baker McKenzie. Together with data provider IJGlobal the report, titled A Changing World: New trends in emerging market infrastructure, shows that development finance lending from state-backed institutions is the most important component of infrastructure funding in sub-Saharan Africa. The report further  notes that China put US$8.7 billion in sub-Saharan Africa infrastructure projects in 2017 alone, while the US recently set up a new US$60 billion agency [USIDFC] to invest in developing countries. African Law and Business notes that competition between the US and China has been heating up within Africa. The US recently announced the establishment of a new development finance institution which will combine with the existing Overseas Private Investment Corporation (OPIC) and bring a USD 60 billion budget with the explicit intention of competing with China. The new institution will be able to invest in equity, whereas OPIC has been limited to debt only. TFX News has even speculated that the US IDFC "could eventually incorporate US Exim".

http://www.infrastructurene.ws/2018/12/03/china-and-us-to-battle-for-influence-i...


Right problem – wrong solution: The Chinese ECA threat to the multilateral official finance system

(TFX News, London, 10 December 2018) Often priced at well below accepted market rates, Chinese official finance is a major hurdle to fair competition in the global export market. A growing number of governments are attempting to compete by circumventing OECD rules and blurring trade with aid. But adding more unfair trade practices risks the global official finance system self-combusting and ending any real chance of a lasting and fair resolution to the problem. While delegates dressed in matching stilettos and pinstripe suits would probably spice up your average OECD meeting, real ECA and DFI cross-dressing – the increasingly blurred lines between tied ECA support and untied multilateral/DFI support – is a serious and growing problem, and one that governments need to address. ECA/DFI cross-dressing is a reaction to a common issue for non-Chinese ECAs – how to compete with opaque official finance offerings from China, which has long been providing cheap debt, arguably at unrealistic market rates. During the past 10 years China has transformed itself from an aid recipient into the largest official financier of developing countries. But many OECD companies are rightly concerned about the completely unregulated official finance practices of China.

https://www.txfnews.com/News/Article/6618/Right-problem-wrong-solution-The-threa...


China's unbridled export of coal power imperils climate goals

(Science X, Isle of Man, 5 December 2018) Even as China struggles to curb domestic coal-fired power and the deadly pollution it produces, the world's top carbon emitter is aggressively exporting the same troubled technology to Asia, Africa and the Middle East, an investigation by AFP has shown. The carbon dioxide (CO2) emissions from these Chinese-backed plants could cripple global efforts to rein in global warming caused by the burning of fossil fuels—especially coal, analysts warn. "China is a world leader in terms of embracing the policy and investment needs to progressively decarbonise its economy," said Tim Buckley, director of energy finance studies at the Institute for Energy Economics and Financial Analysis (IEEFA). "But internationally, China continues to invest in a range of coal project in direct contradiction to its domestic energy strategy." China is not alone in peddling the most carbon-intensive of fossil fuels beyond its borders. As of last month, South Korea and its export credit agencies were positioned to back 12 GW of coal-fired power abroad, and Japan was behind another 10, according to a research note from Han Chen, international energy policy manager at the Natural Resources Defense Council.

https://phys.org/news/2018-12-china-unbridled-export-coal-power.html


TDB rolls out SME programme for women-led businesses in six African countries

(ZDK-Solutions, Luxembourg, 11 December 2018) The Eastern and Southern African Trade and Development Bank (TDB) is rolling out a credit programme in six African countries to support women-led export-oriented SMEs. Among the first to benefit are Ethiopian businesses, following an agreement between TDB and Ethiopia’s Enat Bank. Under a memorandum of understanding, the two have agreed to set up a credit enhancement facility and work together to build a pipeline of SMEs which qualify for export credit support. Focusing on women-owned and managed businesses, the parties will run the programme in partnership with the Ethiopian Women Exporters Association.

http://zdk-solutions.com/zdk/tdb-rolls-out-sme-programme-for-women-led-businesse...


Australia's secret arms deals with nations fighting Yemen's bloody war

(ABC News, Sydney, 13 December 2018) The Australian Government has approved the export of dozens of shipments of military items to Middle Eastern countries embroiled in the bloody Yemen war, a conflict dogged by accusations of war crimes and indiscriminate civilian killings. Australia is exporting to the United Arab Emirates and Saudi Arabia. FOI documents reveal Canberra is attempting to ramp up Australia's arms exports as part of a new defence strategy. Internal Defence Department documents obtained under Freedom of Information (FOI) and from parliamentary hearings reveal since the beginning of 2016, Canberra has granted at least 37 export permits for military-related items to the United Arab Emirates, and 20 to Saudi Arabia. They are the two countries leading a coalition fighting a war against Houthi rebels in the Middle East's poorest nation, Yemen. Janes defence news service notes "The Australian government announced on 17 December that it will provide state credit to support two local companies' efforts to export radars systems and patrol boats... this being the first time that the export credit system - officially termed the 'Defence Export Facility' - has been utilised after being established earlier this year. A major milestone has been reached on Australia's journey to become a top 10 global defence exporter, said a government statement." Australian Defense News notes that "There has been a 48% increase in defence export applications received in the first quarter of FY 2018/19 over the whole of the last financial year."

https://www.abc.net.au/news/2018-12-13/australias-secret-backing-for-nations-fig...


Philippines edges towards procurement of Turkish combat helicoper

(Janes Defence News, London, 29 November 2018) The Philippines Department of National Defense (DND) has edged closer to a decision to procure the Turkish Aerospace Industries (TAI) T129 ATAK multirole combat helicopter to meet a long-standing requirement in the Philippine Air Force (PAF). The acquisition is expected to be facilitated through a government-to-government deal between the Philippines and Turkey, possibly involving credit provided by Turk Eximbank, Turkey's official export credit agency.

https://www.janes.com/article/84896/philippines-edges-towards-t129-procurement


Mexico’s Pemex Targets Bank, ECA-Backed Financing in 2019

(US News, New York, 18 December 2018) Mexican energy producer Petróleos Mexicanos (Pemex) will look to banks and export credit agencies (ECAs) to finance part of its deficit next year, as the company enters 2019 under a new government and uncertain conditions in the international capital markets. State-owned Pemex, which is expected to raise approximately $8 billion in external debt next year, is also facing a bearish investor base concerned that Mexico’s new administration will hinder the company’s fiscal situation. Pemex has a $1.5 billion bank-led revolving credit facility maturing in the second half of 2019 and is on course to raise between $1 billion and $1.5 billion in ECA-backed finance next year, according to three sources familiar with the company’s plans. The company has conducted talks with trade agencies such as Export Development Canada and the Netherlands’ Atradius over ECA-backed loans and in November Pemex received a $250 million 10-year facility from BNP Paribas and HSBC that was 80 percent guaranteed by Italy's SACE.

https://money.usnews.com/investing/news/articles/2018-12-18/mexicos-pemex-target...


Boeing Sees More Growth in Aircraft Financing Demand

(American Machinist, Cleveland, 9 December 2018) Boeing is forecasting strong demand for new commercial airplanes will continue in 2019, with deliveries by major OEMs totaling about $143 billion, and growing to $180 billion by 2023. The commercial-aircraft market’s strong fundamentals also are drawing new participants and investment in used aircraft. The figures and projections are presented in Boeing’s yearly Current Aircraft Finance Market Outlook report, a five-year forecast of the commercial aircraft sector’s financing trends. Boeing predicts that new-aircraft deliveries will be funded by commercial bank debt, capital markets, and cash. Aircraft leasing agents, which represent over 40% of commercial aircraft ownership now, will be supported by historically low financing costs. Export credit also will remain a critical funding source, particularly in the U.S., Boeing added. The JD SUPRA news service has pointed to three new developments in aircraft financing and leasing, AFIC, Balthazar and GATS, which have grown out of the recent drying up of export credit support for Boeing and Airbus financings.

https://www.americanmachinist.com/news/boeing-sees-more-growth-aircraft-financin...


Brazil Freezes ECA Credit After Defaults From Cuba & Venezuela

(Folha de Sao Paulo, Brasilia, 26 December 2018) After Mozambique, Venezuela, and Cuba defaulting, the Brazilian government froze credit lines for new exports, a measure that will affect mostly small and medium-sized businesses. The Brazilian Treasury Department will spend US$ 6 million (R$ 23,4 million) to reimburse BNDES (National Bank For Economic and Social Development) for Cuba's default. Following Venezuela and Mozambique, the Cuban government defaulted on its payments to BNDES, in a credit line insured by the Treasury in the case of nonpayment. The amount is from an installment due in July, which Cuba paid partially. The Cubans paid US$ 4 million (RS 15.6 million) from the US$ 10 million (R$ 39 million) that were due. During the Lula and Rousseff administrations, the countries mentioned above hired large Brazilian contractors for infrastructure works such as the modernization of the Mariel Port in Cuba, performed by Odebrecht. The foreign governments also bought buses, industrial goods and foodstuffs using the credit line.

https://www1.folha.uol.com.br/internacional/en/business/2018/12/government-freez...


BBVA signs first green-certified credit with cover from Spanish ECA

(Global Trade Review, London, 30 November 2018) BBVA has granted a five-year €16.5mn loan to a hydroelectric project in Colombia with backing from Cesce, Spain’s export credit agency (ECA). The operation has been certified as “green” by consulting firm Aecom in line with the Green Loan Principles and the UN Sustainable Development Goals. According to the bank, this is the first credit with Cesce to receive this certification.

https://www.gtreview.com/news/sustainability/bbva-signs-first-green-certified-cr...


Saudi ECA supports Pakistan economy

(Dunya News, Islamabad, 29 November 2018) Finance Minister Asad Umar on Thursday said the government is committed to improving the fundamentals of economy and achieving sustainable and balanced economic growth. The secretary also briefed the meeting about the economic reforms which the Economic Advisory Council has approved. The meeting also discussed the export credit facility offered by Saudi Arabia envisaging the purchase of crude oil and or other petroleum product (s) of up to USD 3.24 billion per annum on a 12 month deferred payment basis.

https://dunyanews.tv/en/Business/468372-Govt-committed-to-achieving-sustainable-...


Peru closes largest-ever ECA financing for state energy company

(Southern Heald, 12 December 2018) State-owned petroleum company Petroperú has closed a US$1.3bn export credit agency-backed financing as part of its US$5bn Talara refinery modernisation project. Deutsche Bank acted as facility agent for the syndicate, which also involves BBVA, BNP Paribas, Citi, HSBC, JP Morgan and Santander as initial mandated lead arrangers, underwriters and bookrunners. It is the largest-ever financing covered by the Spanish export credit agency, Cesce, and is the largest ECA financing arranged in Peru.

http://thesouthernherald.com/peru-closes-largest-ever-eca-financing-for-state-en...


Developing countries biggest installers of renewables

(PV Magazine, Berlin, 27 November 2018) In a new report, BloombergNEF notes a significant uptake in renewable energy in developing countries, which are clearly outperforming OECD countries. The trend is due to reductions in equipment costs and new business models that enable access to capital. Still, many emerging markets are also the biggest installers of new coal capacity. India and China alone, are said to account for 81% of newly added coal-fired power stations.

https://www.pv-magazine.com/2018/11/27/developing-countries-biggest-installers-o...


What's New November 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.

  • Bringing Accountability and Transparency to Export Development Canada’s Practice
  • Report highlights EDC’s multibillion dollar support for oil and gas industries
  • Trading away EU principles in the name of national export interests
  • ECA Support for Coal in the Face of OECD Financing Restrictions
  • The World Needs to Quit Coal. Why Is It So Hard?
  • UK Government considering UKEF deal with Saudi Aramco
  • EXIM Bank's fate tied to the outcome of Senate midterms
  • Uganda expects ECA pipeline financing deal by June 2019
  • Middle East Politics and Export Credits
  • Australia splashes ECA cash in the Pacific as China fears loom

Bringing Accountability and Transparency to Export Development Canada’s Practice

(Above Ground, Ottawa, 12 November 2018) Canada’s Export Development Act is under review. In our submission (pdf) to the government, Above Ground and other Canadian civil society groups call for legal reforms to bolster the accountability and transparency of Export Development Canada (EDC). EDC’s policies state that it screens and monitors the business it supports for associated social, environmental and business ethics risks. Yet over the years we have identified multiple companies that receive support from EDC despite credible or proven allegations involving environmental damage, corruption and human rights violations. In this submission we urge Parliament to adopt legislative reforms that include prohibiting EDC from supporting firms involved in wrongdoing, subjecting it to judicial oversight and expanding the Auditor General’s mandate regarding EDC. We have also made a second submission (pdf) calling for reforms to address the climate impacts of business supported by EDC. In addition, Both ENDS and other CSOs working from a number of countries made a joint submission as formal input to the EDC legislative review regarding EDC support for fossil fuels. The submission emphasized the Canadian governments' ambition to show leadership on climate change and to prioritise climate change action and clean economic growth.

https://aboveground.ngo/accountability-transparency-export-development-canada/


Report highlights EDC’s multibillion dollar support for oil and gas industries

(Windsor Star, Ottawa, 22 November 2018) A new report shows Canada’s export credit agency provides far greater backing to oil and gas companies than to makers of clean technology, a trend the authors contend undermines the country’s commitment to fight climate change under the Paris Agreement. Released Thursday and sponsored by a host of environmental groups, the report from the research and advocacy organization Oil Change International casts light on how Export Development Canada facilitated $62 billion in financial support for Canadian oil and gas companies from 2012 to 2017. That’s 12 times more support than the $5 billion the agency facilitated for clean technologies during that time, the report says, citing the agency’s own data.

https://www.ourwindsor.ca/news-story/9046135-report-highlights-crown-corporation...


Trading away EU principles in the name of national export interests

(Euractiv,  Brussels, 20 November 2018) MEPs need to follow the lead of the European Ombudsman and force the European Commission to shine light on the opaque role of national Export Credit Agencies. An important milestone in this direction was set by recent decisions of the Ombudsman Emily O’Reilly, which she spoke of at a public hearing of the International Trade Committee of the European Parliament. Following an appeal filed by the ECA-watch network – the Ombudsman detected severe shortcomings in the European Commission’s monitoring of national Export Credit Agencies (ECAs), including “maladministration”, failure to acquire adequate information to formulate its judgement, failure to include environmental and human rights standards when it comes to supporting coal projects and the necessity to keep a written record of its analysis and assessment. ECA’s activities have so far been exempt from human rights-related considerations to the point that arms export for cross-border conflicts could have well fit among their activities. There is a long way to go to ensure that European Export Credit Agencies respond to the much needed demand for accountability and transparency, and the European Parliament has a big role to play. It will have to take a firm stand and make sure the Commission does its homework and complies with the Ombudsman’s recommendations. It is a matter of democratic control and the credibility of the European institutions.

https://www.euractiv.com/section/economy-jobs/opinion/trading-away-the-eu-princi...


ECA Support for Coal in the Face of OECD Financing Restrictions

(Friends of the Earth USA, Washington, 13 November 2018) In order to avoid the worst impacts of climate change, no new fossil fuel power plants should have been built after 2017. Despite this, little-known government agencies called export credit agencies (ECAs) are still providing many billions in financing to fossil fuel projects all over the globe. From 2013 to 2015, the world’s largest ECAs provided an annual average of USD 38 billion in support of fossil fuels. Eighty-eight percent of ECA support for energy projects went toward fossil fuels, compared to seven percent for clean energy projects. A new report available here (pdf) analyzes potential and current support for coal plants by ECAs in the Organization for Economic Cooperation and Development (OECD), which includes most of the world’s largest ECAs (though, notably, not China).

https://foe.org/resources/eca-support-coal-face-oecd-financing-restrictions/


The World Needs to Quit Coal. Why Is It So Hard?

(New York Times, Hanoi, 24 November 2018) Coal, the fuel that powered the industrial age, has led the planet to the brink of catastrophic climate change. Scientists have repeatedly warned of its looming dangers, most recently on Friday, when a major scientific report issued by 13 United States government agencies warned that the damage from climate change could knock as much as 10 % off the size of the American economy by century’s end if significant steps aren’t taken to rein in warming. An October report from the United Nations’ scientific panel on global warming found that avoiding the worst devastation would require a radical transformation of the world economy in just a few years. Central to that transformation: Getting out of coal, and fast. According to the latest assessment by the International Energy Agency, it is not on track to happen anywhere fast enough to avert the worst effects of climate change. Last year, in fact, global production and consumption increased after two years of decline. Home to half the world’s population, Asia accounts for 3/4 of global coal consumption today. More important, it accounts for more than 3/4 of coal plants that are either under construction or in the planning stages — a whopping 1,200 of them, according to ECA Watch member Urgewald, a German advocacy group that tracks coal development. Heffa Schücking, who heads Urgewald, called those plants “an assault on the Paris goals.” [OECD coal support abroad is mainly provided by national export credit agencies.]

https://www.nytimes.com/2018/11/24/climate/coal-global-warming.html


UK Government considering UKEF deal with Saudi Aramco

(Ekklesia, London, 16 November 2018) In the wake of the alleged murder of Jamal Khashoggi and international warnings on climate change, the UK Government is discreetly considering supporting a Saudi Arabian oil company with a petrochemical project. UK Export Finance (UKEF), the controversial export credit agency which underwrites risky export deals to boost the UK’s international trade, recently announced that it could use public funds to help develop a large petrochemical refinery in Malaysia. The project, PRefChem, is a joint venture between Petronas, the Malaysian state oil company, and Saudi Aramco, the Saudi Arabian oil giant.

http://www.ekklesia.co.uk/node/27190


EXIM Bank's fate tied to the outcome of Senate midterms

(The Hill, Washington, 30 October 2018) Pollsters are predicting that Kavanaugh’s US Senate confirmation has galvanized Republicans and enhanced Senate Majority Leader Mitch McConnell's (R-Ky.) chances of retaining Senate control. For the last three years, and with little notice, McConnell has deployed tactics to contravene the support of the president and bipartisan congressional majorities to cripple the U.S. Export-Import Bank (EXIM). Because of McConnell’s block of board nominees, EXIM lacks the quorum needed to support deals over $10 million, which historically comprise 80 percent of bank lending. Ten years ago, EXIM responded to the Great Recession by tripling export support, financing $30 billion annually of U.S. exports over a five-year period, creating over a million jobs. Because big deals make money, EXIM made a $3.8 billion profit under Obama. But without a quorum, authorizations fell to $3.4 billion last year. Limited to small, less-profitable deals, EXIM now costs taxpayers money.

https://thehill.com/opinion/finance/413910-exim-banks-fate-is-tied-to-outcome-of...


Uganda expects ECA pipeline financing deal by June 2019

(The East African, Nairobi, 26 November 2018) Uganda and Tanzania signed an agreement in May 2017 to jointly develop the $3.5 billion pipeline that has been described as the longest electrically heated crude oil pipeline in the world. The balance of $1 billion is expected to come from shareholders in equity. Stanbic Uganda secured the role of joint arranger and adviser with Japan’s Sumitomo Mitsui Banking Corp. The two banks had previously planned to raise $3 billion by June this year from export credit agencies.

https://www.theeastafrican.co.ke/business/Uganda-expects-pipeline-financing-deal...


Middle East Politics and Export Credits

(Washington Post, Berlin, 31 October 2018) At the end of last year, the Danish Export Credit Agency had approved eight Iranian banks for credit lines or guarantees and vowed to resist U.S. pressure to dismantle those ties. However, Denmark is now leading a push for new E.U. sanctions against Iran, after its intelligence agencies blamed Tehran for a foiled plot to assassinate an Iranian dissident on Danish soil. In a darkly ironic twist, Iran has condemned the Saudi killing of dissident Khashoggi even as it has a long track record of pursuing operations against opponents living abroad itself. The Jerusalem Post on 6 November noted that the German government defied US sanctions on Iran’s clerical regime on Monday 5 November, by continuing to insure its companies with export credit – 911 million euro for 58 companies.

https://www.washingtonpost.com/world/2018/10/31/foiled-assassination-plot-denmar...


Australia splashes ECA cash in the Pacific as China fears loom

(Sydney Morning Herald, Sydney, 8 November 2018) Australia has announced that at least A$2 billion has been earmarked for grants and long-term projects in the Pacific and Timor Leste, to be administered by a new Australian Infrastructure Financing Facility. An extra A$1 billion will be made available for Australia’s export credit agency EFIC which helps Australian companies invest and expand overseas by giving them loans and guarantees. The announcements in a speech to soldiers in Townsville will be widely read as aiming to edge out growing Chinese infrastructure-building in Pacific nations. Prime Minister Scott Morrison noted that "Australia has an abiding interest in a south-west Pacific that is secure strategically, stable economically and sovereign politically." Raising questions about sovereignty have in the past been a way for Western leaders to express concern that China is loading developing countries up with infrastructure-related debt they cannot handle, making them politically beholden to Beijing, though Mr Morrison stresses Australia will co-operate with other countries including China.

https://www.smh.com.au/politics/federal/scott-morrison-splashes-cash-in-the-paci...


What's New October 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.

  • UK Government climate targets branded ‘laughable’ as UK Export Finance supports new oil refineries abroad
  • NGOs release list of world’s top coal plant developers
  • Boeing says Exim Bank vital for the US amid competition from China
  • Denmark provides world’s largest export credit agency wind financing
  • Longest Gas Pipeline in Nigeria Gets Green Light With Sinosure cover
  • Vinfast, set to be Vietnam's first domestic carmaker, gains $950M ECA credit line
  • Global Export Credit Agencies Support Iran Trade Coverage
  • Tonga starts repaying US$4.7m a year to Chinese ECA for reconstruction
  • Botched Chinese ECA project in Africa is a warning to belt and road investors
  • Africa-India trade to double by 2021 with ECA help

UK Government climate targets branded ‘laughable’ as UK Export Finance supports new oil refineries abroad

(Global Witness, London, 10 October 208) On the week that the Intergovernmental Panel on Climate Change has released its report on the scale of the challenge to limit the dangers of climate change, the near-simulanteous announcement of new UK Government support for oil and gas abroad has been labelled “staggering.” UK Export Finance (UKEF), the UK’s export credit agency which underwrites loans and insurance for risky export deals as part of efforts to boost international trade, announced on Tuesday that it is considering finance for an expansion of an oil refinery in Bahrain which would allow its total output to increase up to a maximum of 380,000 barrels per day. Adam McGibbon, Climate Change Campaigner at Global Witness, said: “As the world reels from the news that we have twelve years to prevent catastrophic climate breakdown, today’s announcement by the government is staggering. The UK claims to be a climate leader, but it continues to spend billions pumping fossil fuels out of the ground abroad." Articles in The Times, The Indpendent, BBC and Ekklesia highlight this contradictory approach.

https://www.globalwitness.org/en/press-releases/uk-government-climate-targets-br...


NGOs release list of world’s top coal plant developers

(Urgewald, Berlin, 4 October 2018) Four days before the International Panel on Climate Change (IPCC) puts forward its special report on 1.5°C, NGOs have released a new list of the world’s top 120 coal plant developers.  “Building new coal plants is an assault on the Paris climate goals,” said Heffa Schuecking, director of the German environment NGO Urgewald. “Our list names the top companies investors and banks need to shun if they are committed to limiting our planet’s temperature rise.” While 2017 was another record-busting year for renewables, coal power is still growing in many parts of the world. Currently, 1,380 new coal plants or units are planned or under development in 59 countries. The world’s largest coal plant developer is China’s National Energy Investment Group (NEI), which aims to build 37,837 MW of new coal plants.

https://mailchi.mp/banktrack/over-600000-mw-of-new-coal-threaten-15c-climate-tar...


Boeing says Exim Bank vital for the US amid competition from China

(The National, Abu Dhabi, 3 October 2018) Planemaker Boeing said the US Export-Import Bank (Exim), the country's export credit agency, [sic - return?] to its full lending powers is vital to the country's economy and the company's ability to compete with global rivals. The US is locked in an escalating trade war with economic rival China in a tit-for-tat round of tariffs. The long-hobbled US export credit agency, which facilitates export deals between American manufacturers and overseas buyers, has been in limbo for three years due to congressional inaction. In 2018, export credit is expected to remain a "marginal" share of aircraft financing but export credit agency volumes will increase to stable levels from historical lows this year, Boeing said. [Export credit agencies are major funders of aircraft - in 2010 about 50% of all Airbus deliveries were covered by export credit agencies. ECAs allocate about a third of their long-term financing to aircraft sales, the largest representation of any sector.]

https://www.thenational.ae/business/aviation/boeing-says-exim-bank-vital-for-the...


Denmark provides world’s largest export credit agency wind financing

(Global Trade Review, London, 28 September 2018) Denmark’s EKF has signed an £800mn guarantee for Hornsea 1 in what it says is the largest wind financing that any public export credit agency has ever provided. Located off the coast of Yorkshire, UK, Hornsea 1 is currently being constructed by Danish wind farm developer Orsted, formerly Dong Energy. According to EKF, it will finance suppliers such as Siemens Gamesa Renewable Energy, but also a “vast number of sub-suppliers” from Denmark. EKF has also guaranteed about EUR 100 million of the EUR 210 million European Investment Bank (EIB) facility for the Euro 700 million Northwester 2 offshore wind farm in Belgian waters.

https://www.gtreview.com/news/europe/denmark-provides-worlds-largest-export-cred...


Longest Gas Pipeline in Nigeria Gets Green Light With Sinosure cover

(Pipeline Technology Journal, Hannover, 27 September 2018) The 614-km, 40 inch Ajaokuta - Kano Gas Pipeline (AKK), the single biggest gas pipeline in the history of oil and gas operations in Nigeria, will now go forward with $ 2.38 bn financing secured by the China National Petroleum Corporation. While 85 per cent of the money is expected to be provided by the financiers, which include Industrial and Commercial Bank of China, Bank of China, and Infrastructure Bank of China with Sinosure, China’s Export Credit Agency providing insurance cover, the remaining 15 per cent will be provided by the contractors, which include Oilserve/Oando consortium, as well as Brentex/China Petroleum Pipeline Bureau consortium.

https://www.pipeline-journal.net/news/longest-gas-pipeline-nigeria-gets-green-li...


Vinfast, set to be Vietnam's first domestic carmaker, gains $950M ECA credit line

(Reuters, Hanoi, 10 October 2018) VinFast, which aims to become Vietnam's first domestic car manufacturer, said it has secured a 12-year credit facility for as much as $950 million to help buy machinery and equipment from German suppliers. Vingroup has earmarked about $3.5 billion for the project. Credit Suisse and HSBC were the lead arrangers and the financing agreement was guaranteed by German export credit agency Euler Hermes.

https://www.euronews.com/2018/10/10/vinfast-set-to-be-vietnams-first-domestic-ca...


Global Export Credit Agencies Support Iran Trade Coverage

(Financial Tribune, Tehran, 20 October 2018) Global Export Credit Unions participating in a meeting of the Berne Union Credit and Investment Insurers this week backed sustained cooperation with Iran despite the US move earlier this year to pull out of the historic nuclear agreement. According to a press release by the Export Guarantee Fund of Iran, whose representative attended the event, the countries present declared that insuring trade with Iran is possible under the existing circumstances. Arash Shahraini, a member of board of directors and technical deputy of EGFI told the Financial Tribune on Sunday that while there was a positive mood of support for Iran coverage at the meeting, members were cognizant of the fact that lack of a proper banking channels for payments to Iran continues to be a main hurdle to promoting Iranian trade with the outside world.
 

https://financialtribune.com/articles/economy-business-and-markets/94595/global-...


Tonga starts repaying US$4.7m a year to Chinese ECA for reconstruction

(Matangi, Tonga, 22 October 2018) The Tonga Government will start paying US$4.7m a year during the next ten years, (principal only) of its US$52m loan from the Exim Bank of China that was used to fund reconstruction projects after the 2006 riots in Nuku'alofa. The start of the principal repayments has already contributed to a $22.8m decline in Tonga’s foreign reserves in September. Now Tonga is confronting the real cost of the riots and still recovering from the impact of Tropical Cyclone Gita which struck the main island of Tongatapu in February 2018 and caused about US$148m worth of damage, equivalent to nearly a third of the country's gross domestic product.

https://matangitonga.to/2018/10/22/tonga-starts-repaying-108m-year-china-reconst...


Botched Chinese ECA project in Africa is a warning to belt and road investors

(South China Morning Post, Hong Kong, 29 October 2018) The planning behind many of China’s major infrastructure projects abroad has been “downright inadequate”, leading to huge financial losses, according to the head of the country’s state export credit insurer. Wang Wen, of China Export and Credit Insurance Corporation, known as Sinosure, said Chinese developers and financiers of projects in developing nations supported by Beijing’s “Belt and Road Initiative” need to step up their risk management to avoid disaster. He cited the mistakes of a major railway project in Africa that has cost Sinosure close to US$1 billion in losses. “Ethiopia’s planning capabilities are lacking, but even with the help of Sinosure and the lending Chinese bank it was still insufficient.” He said other China-backed projects plagued by poor preparation have included sugar refineries that have lacked a supply of sugar beet, and underused railways in Latin America.

https://www.scmp.com/business/banking-finance/article/2170549/botched-chinese-ra...


Africa-India trade to double by 2021 with ECA help

(Southern Times, Windhoek, 29 October 2018) Trade between Africa and India has risen over the past 10 years and is highly likely to double its total of US$60 billion in 2017 to US$120 billion in 2021, according to a report released by the African Export-Import Bank (Afreximbank) and the Export-Import Bank of India (Exim India). The impressive growth in trade between Africa and India stems from a mix of factors... Against the backdrop of increasing uncertainty in the global economy, reliance on innovative and non-traditional financing solutions developed by export credit agencies, including the Export-Import Bank of India (Exim India) and the African Export-Import Bank (Afreximbank), not only helps in mitigating risks in international trade but also contributes to promoting regional trade and investment.

https://southerntimesafrica.com/site/news/africa-india-trade-to-double-by-2021


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