Index for June 2011

Volume 10, Issue 7

  • (stopwapenhandel, Amsterdam, 24 July 2011) Rarely mentioned in the discussions on the Greek crisis is their history of sustained excessive military spending over the past decade, which includes support from official export credit agencies. It is safe to state that if Greece had allocated just half the money for its military budget since the end of the Cold War, its economic outlook would have been much healthier - without the slightest compromise to the safety of the country. It is hard to explain why the EU spends billions of euros to save Greece from bankruptcy, while at the same time pushing arms deals with a country forced to execute radical austerity measures.

Volume 10, Issue 6

  • (ECA Watch, Brussels, 29 June 2011) ECA-Watch, Amnesty International and Eurodad welcome the EU permanent representatives' endorsement of the European Parliament’s proposal to make national export credit agencies (ECAs) more accountable for the support they give companies doing business around the world. The three organisations believe this move will increase transparency and human rights compliance and  hope that this will trigger more ambitious reforms in EU capitals, leading to a general reform in global ECA standards.
  • (ECA Watch, Brussels, 7 June 2011) This newspaper style publication outlines the history of Export Credit Agencies' support for the nuclear industry and concludes by detailing the destructive projects still in the pipeline. Articles include; Crippling losses and corruption: nuclear exports Canadian-style; Gift RAPP: Canada’s support for nuclear power and proliferation in India and Pakistan; Nuclear – a publicly subsidised love affair; and German nuclear exports 2009 - 2011:Back to square one!
  • (Financial Gazette, Harare, 3 June 2011) Zimbabwe owes Britain's Export Credit Guarantee Department (ECDG) £190,4 million and has not indicated when it will repay the money, the UK Undersecretary of State for Business, Innovation and Skills, Edward Davey, recently told the House of Commons. Zimbabwe is among 24 countries, eight of them African, which owe the ECGD £2,4 billion. Sudan owes the highest amount of £663,68 million and like Zimbabwe has not indicated when it will repay. Indonesia is second with £445,96 million but it has indicated that it will repay the money by  June 1 2021. Iraq is third and owes £290,18 million. It has indicated that it will repay the money by 1 January 2028. Zimbabwe is fourth. Relations between Britain and Zimbabwe have been frosty but this has not affected business to a large extent.
  • (Bloomberg, 3 June 2011) Qatar Airways Ltd. & Emirates, already luring passengers from British Airways and Air France, will extend the contest to the $68 billion air-freight market by turning their bases into global cargo hubs... "They’re financed differently and that makes it easier to add capacity than if you have to go to the banks,” competitor SkyTeam said in an interview in May. Emirates, whose record $1.6 billion profit for the year ended March 31 was twice Air France-KLM’s earnings for the same period, says only 20% of its plane purchases have employed export credit. Meanwhile, UniCredit and Intesa Sanpaolo acting as SACE and Coface agents respectively, have recently signed an ECA Facility Agreement for the number one Russian domestic Airline UTair Aviation JSC, to finance its acquisition of a fleet of 20 new ATR 72-500 regional aircraft in a transaction valued at US $426 million.
  • (Reuters, Washington, 15 June 2011) The US needs to use its export financing tools more aggressively to confront growing competition from China and other developing countries not bound by the same rules as rich nations, the head of the U.S. Export-Import Bank said on Wednesday... That could include stretching the rules on export credits that apply to rich countries that make up the Organization for Economic Cooperation and Development, to pressure China and other developing countries into negotiations on new rules, he said. However, US exporters surveyed by Ex-Im cited the most frequently identified competitor ECAs (in descending order) as being Euler Hermes/Germany, EDC/Canada, COFACE/France, EGDC/UK, and China Eximbank (p.140). The report also noted a need for better data and analysis of how Ex-Im compares with other G7 ECAs.
  • (The Financial, Hamburg, 24 June 2011) The readers of the English Trade Finance Magazine again voted the Export Credit Guarantees of the Federal Republic of Germany (Hermes Cover) "Best Global ECA". Thus the German export credit guarantee scheme takes an outstanding position internationally. What brought about this success were the high quality of the guarantee scheme, the wide range of cover options and the long-term support for the export industry which Hermes Cover have been showing over a long period.