ECA Watch Newsletter

What's New December 2021

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.

  • ECA Watch letter to European Commission re ECAs and corporate social governance
  • Friends of the Earth sues Britain over Mozambique LNG project
  • ESA adopts revised state ECA/corporate aid guidelines
  • Russia's Arctic LNG 2 agrees loans worth 9.5 bln euros
  • Russia's Amur Gas Chemical Complex secures $9.1 bln in ECA & bank loans
  • Facing debt repayment issues China shifts Africa financing focus from infrastructure to trade
  • Charting a new course: The future of UK exports and export finance
  • Biden orders U.S. to stop financing new carbon-intense projects abroad
  • EXIM supports Lithuania in political dispute with China
  • EKF issues ‘biggest ever’ loan for Turkey railway project
  • General Electric : Another milestone for Dogger Bank Wind Farm as it reaches financial close for third phase

ECA Watch letter to European Commission re ECAs and corporate social governance

(ECA Watch, Amsterdam, 25 November 2021) The European Commission is working on a proposal for a directive on corporate social governance, which will include a regulation of the human rights and environmental due diligence (HREDD) obligations of corporations. We urge the proposed new regulation to become legally binding on the due diligence obligations of ECAs of member states, to make ECAs liable for its implementation and to implement export credit insurance as an enforcement mechanism for the legislation., This directive should oblige ECAs to monitor and follow HREDD policies and would ban companies, that have violated their duties under the directive, from ECA support.

https://www.eca-watch.org/sites/default/files/2021-11-25_Letter%20by%20ECA%20Wat...


Friends of the Earth sues Britain over Mozambique LNG project

(Reuters, London, 7 December 2021) – A legal challenge by Friends of the Earth against the British government will be heard on Tuesday in the High Court seeking to block a $1.15 billion financing for a Liquefied Natural Gas (LNG) project in Mozambique, the environmental activist group said on Tuesday. Britain’s export credit agency UK Export Finance (UKEF) has committed to provide up to $1.15 billion of direct loans and guarantees to banks to support the design, build and operation of the $20 billion LNG project led by French energy company TotalEnergies. Friends of the Earth said in a statement the project was incorrectly judged to be compatible with the Paris climate agreement, without proper assessment of the development’s climate impacts. A recent report by Friends of the Earth estimated that the project could emit up to 4.5 billion tonnes of greenhouse gases over its lifetime. That is more than the combined annual emissions of all 27 EU countries, according to the authors of the report. The money – a combination of loans and guarantees – comes from the government’s export credit agency, UK Export Finance (UKEF). At an advanced point in the negotiations, UKEF “felt that not agreeing to the loan would be embarrassing to the United Kingdom given its role in the African Development Bank”, FOEUK lawyer Simor told the court. The African Development Bank is co-financing the project, which is led by oil company Total. Mozambique is not only one of the poorest countries in the world, but also one of the most affected by the climate crisis and most vulnerable to its impacts. It is also in the middle of a violent Islamic State-led insurgency.

https://kfgo.com/2021/12/07/friends-of-the-earth-sues-britain-over-mozambique-ln...


ESA adopts revised state ECA/corporate aid guidelines

(ECA Watch, Ottawa, 31 December 2021) The EFTA Surveillance Authority (ESA) which monitors non-EU European Free Trade Association States (Iceland, Liechtenstein and Norway) has adopted two sets of revised guidelines in the field of state aid: one on the promotion of risk finance investments and another on short-term export credit insurance. Both guidelines correspond to guidelines adopted by the European Commission and aim to ensure [the fiction of] a level playing field for businesses across the EEA. State aid for export credits monitored by the EU [and the OECD] enable foreign buyers of goods and services to defer payment. This entails a credit risk for sellers, for which they can insure themselves. This is known as export credit insurance. The guidelines will [supposedly] help ensure that state aid does not distort competition in the EEA among private and public - or publicly supported - export credit insurers, and create a level playing field among exporters.

https://www.marketscreener.com/news/latest/ESA-adopts-revised-state-aid-guidelin...


Russia's Arctic LNG 2 agrees loans worth 9.5 bln euros

(Reuters, Moscow, 30 November 2021) Russian gas producer Novatek (NVTK.MM) said on Tuesday its Arctic LNG 2 plant has signed loan agreements with foreign and Russian banks worth 9.5 billion euros ($10.8 billion), securing necessary external financing for the project. Earlier this year, Novatek shareholders approved external financing of $11 billion for the $21 billion Arctic project, which is expected to start production of liquefied natural gas in 2023. Novatek has had difficulty in securing funds from Europe, wary of political standoff with Russia as well as calls against tapping hydrocarbons in the Arctic amid efforts to tackle climate change. Chinese financial institutions, including the China Development Bank and the Export-Import Bank of China, signed credit facility agreements totalling 2.5 billion eurosfor up to 15 years. Financial institutions from the OECD member countries signed credit facility agreements totaling up to 2.5 billion euro. This includes the Japan Bank for International Cooperation (JBIC) and other lenders insured by export credit agencies. Sources told Reuters earlier this month that Italy's SACE may insure a loan of around 500 million euros for Arctic LNG 2.

https://www.reuters.com/markets/asia/russias-arctic-lng-2-agrees-loans-worth-95-...


Russia's Amur Gas Chemical Complex secures $9.1 bln in ECA & bank loans

(Reuters, Moscow, 8 December 2021)  Russia's Amur Gas Chemical Complex (Amur GCC) has secured $9.1 billion in loans maturing in 2035, Sibur, which co-owns the plant with China's Sinopec, said in a statement on Wednesday. International banks will provide $2.6 billion for the Amur GCC with coverage from export credit agencies SACE of Italy and Germany's Euler Hermes, Sibur said, while Chinese and Russian banks will issue the remaining $6.5 billion.

https://www.reuters.com/business/energy/russias-amur-gas-chemical-complex-secure...


Facing debt repayment issues China shifts Africa financing focus from infrastructure to trade

(Global Trade Review, London, 15 December 2021) China’s commitments to financing in Africa are shifting away from giant infrastructure developments and towards developing stronger trade flows and commercial investments, analysts say. At the Forum on China-Africa Cooperation (Focac) in late November, the country unveiled an action plan that included around US$40bn of commitments in the form of trade finance, commercial investments and a share of China’s Special Drawing Rights (SDR). Although a hefty headline figure, it is significantly less than the US$60bn promised at the two most recent forums in 2015 and 2018. It also includes little in the way of concessional loans, which has been China’s primary tool for financing a swathe of infrastructure across the continent, including railways, airports, roads and energy projects. GTR reported in September that European export credit agencies and commercial lenders have been approached by Chinese contractors working on projects in Africa who have been unable to secure financing from Chinese sources. The Atlantic Monthly calls this "China's real 'debt trap' threat, claiming it "is part of a deepening debt crisis affecting countries that have borrowed hundreds of billions of dollars from China for infrastructure development... It’s not just low-income countries that are hard-pressed to repay China. Middle-income nations also are seeking to renegotiate their Chinese debts as the pandemic-induced global economic slowdown nears the two-year mark. But Chinese lenders are digging in their heels as governments ask for relief, especially with countries that don’t receive media attention. And those countries are feeling the pain. For example, Suriname’s inability to access IMF funds means less money for social programs at a time when the pandemic has increased demand for health care and other programs focused on the poor.

https://www.gtreview.com/news/africa/china-shifts-africa-financing-focus-from-in...


Charting a new course: The future of UK exports and export finance

(Global Trade Review, London, 13 December 2021) [Barclays sponsored GTR article] Having been profoundly shaken by the combined impact of the pandemic and Brexit, UK exporters continue to face significant trade challenges. As companies rethink and recalibrate their export strategies and supply chains, there is an increased focus on ESG performance and an opportunity to build back not only better, but cleaner and greener. In mid-November, GTR and Barclays gathered top trade experts for a virtual roundtable discussion to address the crucial issues impacting the export and export finance market, the route to export recovery and growth in a more sustainable environment, and the role of the financial sector in keeping trade flowing.

https://www.gtreview.com/news/europe/charting-a-new-course-the-future-of-uk-expo...


Biden orders U.S. to stop financing new carbon-intense projects abroad

(Reuters, Washington, 10 December 2021) The Biden administration has ordered U.S. government agencies to immediately stop financing new carbon-intensive fossil fuel projects overseas and prioritize global collaborations to deploy clean energy technology, according to U.S. diplomatic cables seen by Reuters. However, "This policy is full of exemptions and loopholes that lack clarity, and could render these restrictions on fossil fuel financing completely meaningless," said Kate DeAngelis, a climate finance expert at Friends of the Earth. FOEUS notees that while the policy states that “infrastructure directly related to the production, transportation, or use of fossil fuels, including oil and natural gas, are considered ‘carbon-intensive international energy engagements,’” it then defines “carbon-intensive” using metrics (i.e., kWh) that appear to only apply to electrical generation (i.e., power plants), not production, transportation, or mid-stream like LNG.

https://www.reuters.com/business/energy/biden-orders-us-stop-financing-carbon-in...


EXIM supports Lithuania in political dispute with China

(Epoch Times, Washington, 22 December 2021) Lithuania's regional and economic stability is facing challenges from the Chinese regime for allowing self-ruled Taiwan, which Beijing claims as a runaway province, to open a de facto embassy in its capital Vilnius. In response, China recalled its ambassador in August before downgrading the diplomatic relations and expelled Lithuania’s top representative to China in November. Beijing has imposed a trade embargo over Lithuanian exports and imports, and has threatened multinationals to sever ties with Lithuania or face being shut out of the Chinese market. Chinese customs authorities have refused to import or clear goods from the Baltic nation. The US is supporting Lithuania in this dispute. [It is interesting to note that it was the right-wing Falun Gong owned Epoch Times which flagged the EXIM approval of a $600 million export credit agreement with Lithuania on Nov. 24, in a bid to boost economic cooperation between the two nations and withstand increased pressure from the Chinese regime.]

https://www.theepochtimes.com/us-expresses-ironclad-solidarity-with-lithuania-fa...


EKF issues ‘biggest ever’ loan for Turkey railway project

(Global Trade Review, London, 8 December 2021) Danish export credit agency EKF has signed its largest ever export loan for the construction of a high-speed railway project in Turkey. The agency is lending €576mn to the Turkish finance ministry for the project. The loan is classified as green because the electric railway is categorised as sustainable under the EU’s sustainable financing taxonomy. The total value of the financing is €1.1bn, which includes contributions from Swedish public finance and export credit bodies EKN and SEK. Standard Chartered and several other commercial lenders are also involved in the deal, but their exact roles have not yet been disclosed.

https://www.gtreview.com/news/europe/ekf-issues-biggest-ever-loan-for-turkey-rai...


General Electric : Another milestone for Dogger Bank Wind Farm as it reaches financial close for third phase

(Market Screener, Annecy, 2 December 2021) General Electric announced that the Dogger Bank Wind Farm, between 130km and 190km off the north-east coast of England in the North Sea, reached financial close on debt financing for phase C, the third 1.2 GW phase. Upon completion, Dogger Bank is expected to be the world's largest offshore wind farm with the total number of Haliade-X units to be installed at Dogger Bank reaching 277.  GE Energy Financial Services ("GE EFS") partnered with the co-sponsors to support insurance cover from Bpifrance, which insured a portion of the ECA debt financing. Separate debt facilities structured by the co-sponsors are supported by EKN, the Swedish export credit agency and Export Finance Norway (Eksfin), the Norwegian export credit agency. Dogger Bank C will connect to the grid at Lackenby England.

https://www.marketscreener.com/quote/stock/GENERAL-ELECTRIC-COMPANY-4823/news/Ge...


What's New November 2021

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.

  • U.S., U.K. lead pledge to end overseas oil and gas financing, but with big caveats
  • G20 ECAs and public finance institutions are still bankrolling fossil fuels
  • European export finance alliance pushes for green incentives [eventually!]
  • If global finance can step up to the net-zero challenge, governments surely can
  • Will the capital to invest in net-zero plans be available?
  • The push to net zero - Can project finance fuel investment in the Hydrogen market?
  • International Chamber of Commerce proposes new framework for sustainable trade finance
  • UAE’s ADNOC secures $3bn loan from JBIC and 4 other banks
  • Shipowners see growing benefits of Chinese leasing and trade finance
  • Russian ECA Helps Bangladesh enter nuclear power age
  • U.K. to Set 1 Trillion Pound Post-Brexit Export Target
  • US EXIM focus on Africa
  • British Airways secures another £1bn UKEF-backed facility
  • Norwegian ECA supports North Pole cruising in style
  • Lithuania to get U.S. EXIM trade support as it faces China fury over Taiwan
  • New OECD down payment requirements set to boost ECA support in emerging markets
  • Russians Discuss Increased Engagement With Africa

U.S., U.K. lead pledge to end overseas oil and gas financing, but with big caveats

(Politico, Glasgow, 4 November 2021) The United States, the U.K. and some 20 other countries and financial institutions pledged on Thursday to stop public financing for most overseas oil and gas projects by next year, though the agreement included wide latitude for participants to set their own exemptions and many of the world's leading backers of those projects declined to sign on. The pledge is limited to ending financing of "unabated" oil and gas projects, and would allow those that include carbon capture and sequestration technology. A senior Biden administration official told POLITICO the measure includes exemptions, and that the Biden administration had not settled on how it would instruct its finance aid organizations like the U.S. Export-Import Bank. How tight any carve-outs are for oil and gas is potentially significant for Ex-Im, which approved $5 billion in fossil fuel finance the last two years, environmental group Friends of the Earth said in a statement. "While this is welcome progress, countries, especially the U.S., must hold firm to these commitments, shutting off the spigot to fossil fuel companies like [Mexico's] Pemex and Exxon," said Kate DeAngelis, manager of Friends of the Earth's international finance program. She also called out "laggards like Japan and Korea" to join the new pledge.

https://www.politico.com/news/2021/11/04/us-uk-pledge-end-overseas-oil-gas-finan...


G20 ECAs and public finance institutions are still bankrolling fossil fuels

(Oil Change Int'l/FOEUSA, Washington, October 2021) This 36 page reprort documents how G20 countries and the multilateral development banks (MDBs) they govern in 2018-2020 provided at least US$63 billion per year in international public finance for oil, gas, and coal projects. This fossil fuel finance was 2.5 times more than their support for renewable energy, which averaged only US$26 billion per year. This continued support for fossil fuels from trade and development finance institutions counters G20 countries’ commitments under the Paris Agreement to align financial flows with a safe climate future as well as their 2009 commitment to phase out fossil fuel subsidies. It also undermines the effectiveness of climate finance, which is still not delivered at either the scale promised (US$100 billion per year from 2020) or needed. ECAs continue to be the largest supporter of international fossil fuel projects, providing billions annually in 2018-2020: ECAs provided an average of US$40.1 billion annually to fossil fuels — 82% of ECA support. This 36 page report shows that the science is clear — governments must rapidly wind down fossil fuel production and use to avoid the worst climate impacts, noting that the recent Intergovernmental Panel on Climate Change (IPCC) report is a “code red for humanity.”

https://1bps6437gg8c169i0y1drtgz-wpengine.netdna-ssl.com/wp-content/uploads/2021...


European export finance alliance pushes for green incentives [eventually!]

(Global Trade Review, London, 24 November 2021) Seven European countries have pledged to promote reforms and encourage green incentives in the export credit sector, but dashed campaigners’ hopes that they would axe public finance for fossil fuels more quickly than the end of 2022 deadline set at the Cop26 conference. The Export Finance for Future (E3F) coalition, initially comprising Denmark, France, Germany, the Netherlands, Spain, Sweden and the UK, held its second virtual meeting today, hosted by the Dutch government. Belgium, Finland and Italy also joined the alliance today, Dutch state secretary for finance Hans Vijlbrief told the summit following the nations’ closed-door talks. A statement expected after the meeting had not been published as of press time, but a draft seen by GTR said the E3F countries would collaborate on strategies to meeting a pledge signed by each at the Cop26 climate change summit to end public finance support for fossil fuels by the end of 2022. The E3F members provided €20bn in export finance for fossil fuel projects overseas between 2018 and 2020, according to data cited by Oil Change International, a campaign group, and ODI, a think-tank. This compares to €17bn for clean energy projects over the same period. Vijlbrief indicated that attendees at the closed-door meeting endorsed support for natural gas beyond the end of the [Cop26] 2022 deadline. “We all know gas will play a role for a couple of years in our energy supply, that’s no secret,” he said. Peder Lundquist, chief executive of EKF, Denmark’s ECA, told the summit that “logically you need some kind of transition”, pointing to natural gas as a “stable” energy source for power grids in less-developed countries that would struggle to handle a rapid shift to renewables. Deputy assistant for export finance at France’s Treasury directorate, Paul Teboul, said his government does not plan to end support for upstream gas projects until 2035.

https://www.gtreview.com/news/sustainability/european-export-finance-alliance-pu...


If global finance can step up to the net-zero challenge, governments surely can

(Guardian, London, 13 November 2021) A new alliance of financial institutions is committed to funding the changes necessary to avert climate catastrophe. Alliance Chair Mark Carney notes that six years ago, in Paris, countries reached an historic agreement to limit the global temperature rise to less than 2C, targeting 1.5C. "In finance, we launched the task force on climate-related financial disclosures so that companies would disclose their climate-related risks, allowing finance to measure what matters." Despite these breakthroughs, in the years that followed, action didn’t match ambition. Few countries pursued the necessary policies, and business investment in decarbonisation was limited. Too many in finance thought that the climate crisis was someone else’s problem. People will no longer tolerate worthy statements followed by futile gestures. In April, we launched the Glasgow Financial Alliance for Net Zero (GFANZ), which now covers the entire waterfront of finance: banks, insurers, pension funds, export credit agencies and asset managers. It comprises more than 450 leading financial institutions from 45 countries. Its members have committed to managing their assets, which total more than $130tn, in line with achieving 1.5C. The total cost of the global transition is estimated to be about $4tn every year for the next three decades, so there are now more than enough readily available resources to do the job. While this is a watershed achievement, some are understandably sceptical. After all, if governments didn’t follow through after Paris, why would finance after Glasgow? [For example, in another news item, the Bureau of Investigative Journalism has reported that HSBC, on behalf of a group of 12 banks on Prince Charles’s Financial Services Taskforce, coordinated efforts to try and water down GFANZ action on climate change. The Bureau details that HSBC lobbied Mark Carney’s Net Zero Banking Alliance to: remove the list of sectors that must be included in the first round of target-setting; set targets only for sectors where there are “credible transition pathways” to a net-zero future and delay until 2025 or 2030 the deadline for banks to set targets for some carbon-intensive sectors, instead of 18 months from signing the NZBA commitment.]

https://www.theguardian.com/commentisfree/2021/nov/13/global-finance-net-zero-ch...


Will the capital to invest in net-zero plans be available?

(Morningstar, Chicago, 9 November 2021) Capital critical to funding the greening of utilities and other industries makes the financial industry a key player in curbing global warming. At a global climate summit last week, big banks, institutional investors, insurance companies, and regulators announced that the amount of capital controlled by institutions [which claim to be] committed to net-zero initiatives now tops $130 trillion, up from $5 trillion in 2020, according to the Glasgow Financial Alliance for Net Zero. That is about equal to the $100 trillion to $150 trillion amount required to transform the economy to a net-zero by 2050, the group claims. Banks, insurers, pension funds, asset managers, export-credit agencies, stock exchanges, credit rating agencies, index providers, and audit firms have committed to achieving net-zero emissions by 2050 at the latest and plan to report progress and financed emissions annually. For now, the impact on the finance industry itself isn’t clear. Lenders will still be looking for a good return and are already funding projects “that provide an appropriate return". [i.e. they have to make money if they're going to save the planet] How different portfolio companies will reduce emissions can be fraught, as they are struggling with their own net-zero plans. Dan Dorman of Calvert notes that while many of the largest banks had already committed to decarbonizing their portfolios, his conversations with executives suggest “they really don’t have details [yet] about how to land this plane.” There is also some debate about whether the group is double-counting the money that it claims is available.

https://www.morningstar.com/articles/1065669/what-banks-climate-pledges-mean-for...


The push to net zero - Can project finance fuel investment in the Hydrogen market?

(Lexology, London, 18 November 2021) Discussion of hydrogen fuel has become increasingly prevalent over the past few years. The increased push to reach net zero targets, as highlighted in the Government's newly published 'Net Zero Strategy: Build Back Greener', has brought hydrogen back into popular discussion. New technological innovations look to be making hydrogen energy cleaner, cheaper and more accessible for industry. This may be opening new doors for the element. How will this unprecedented scale of energy innovation investment be funded? Historically, groundbreaking energy technologies have relied upon significant government subsidies, supported by bankable project financing. Can hydrogen replicate the project finance model? If not, where will the money come from? The current funding for investments into hydrogen technologies is found largely in government or university research and development grants and corporate venture equity. There is very little hydrogen being funded through debt finance. Hydrogen, however, is an energy source that still requires significant investment; both in production (for example, developing effective and cost-viable carbon capture and storage facilities to accompany blue hydrogen production) and in delivery and use (for example, in getting gas infrastructure and networks, consumer products and energy storage ready to facilitate a hydrogen market).

https://www.lexology.com/library/detail.aspx?g=3223ce60-4ea7-4434-9937-664adb0e9...


International Chamber of Commerce proposes new framework for sustainable trade finance

(Reuters, London, 10 November 2021) The standard setter for global trade finance flows has proposed a new set of rules to define sustainability in the trade finance arena, worth some $5 trillion a year, an executive told Reuters. While governments and business sectors move quickly to set guidelines for some types of sustainable finance, there are no standards for trade finance. Those rules would apply to a third of global trade. Agreeing on a common rulebook could help direct more trade flows toward efforts that reduce climate-warming emissions and that also meet the United Nations' development goals, said Andrew Wilson, policy director at the International Chamber of Commerce (ICC).

https://www.reuters.com/business/cop/icc-proposes-first-global-framework-financi...


UAE’s ADNOC secures $3bn loan from JBIC and 4 other banks

(Arab News, Jeddah, 18 November 2021) The Abu Dhabi National Oil Company (ADNOC) signed a $3 billion loan agreement with Japan's export credit agency and four other lenders, Reuters reported citing JBIC. The Japan Bank for International Cooperation (JBIC) is providing $2.1 billion and Sumitomo Mitsui Banking Corporation (SMBC), the Tokyo branch of HSBC, Mizuho and MUFG are providing the rest, JBIC said in the statement. "This facility is intended to provide necessary support to ADNOC in ensuring stable imports of crude oil by Japanese companies," JBIC said.

https://www.arabnews.com/node/1970756/business-economy


Shipowners see growing benefits of Chinese leasing and trade finance

(Lloyd's List, London, 23 November 2021) The shipping industry is going to rely more on Chinese financing as those vessels that fall short of environmental standards become less attractive for traditional lenders, executives say. Shipowners say China is important for finance when it comes to renewing and expanding fleets, and would play an instrumental role for those vessels that will soon become unfinanceable by traditional banks.

https://lloydslist.maritimeintelligence.informa.com/LL1138949/Shipowners-see-gro...


Russian ECA Helps Bangladesh enter nuclear power age

(Eurasia Review, Albany, 13 November 2021) Bangladesh initiated its nuclear program in 2013 by signing a treaty with Russia that opened up a new avenue in their bilateral cooperation. At that time, the two countries signed a state export credit agreement to implement a nuclear project in Bangladesh. The work on the Rooppur plant started with the direct financial and technical cooperation of Russia. There are garment factories in Bangladesh which are producing in huge quantities. So, Bangladesh needs electricity. In 2009 the power generation was 3200 MW; now it has exceeded 20,000 MW. Two 1200-MW capacity reactors are being set up at Rooppur. Once the first nuclear power plant in Bangladesh begins production, it will kick-start another developmental revolution in the country.

https://www.eurasiareview.com/13112021-with-russian-help-bangladesh-set-to-enter...


U.K. to Set 1 Trillion Pound Post-Brexit Export Target

(Bloomberg, London, 14 November 2021) The U.K. will announce a new export target this week of 1 trillion pounds ($1.3 trillion) per year by 2030 as part of Prime Minister Boris Johnson’s move to overhaul its export strategy to show the benefits of leaving the European Union. A new “made in U.K., sold to the world” campaign will also be launched, as well as initiatives to boost overseas trade by providing export-linked loans and access to expertise and advice, the newspaper said. U.K. Export Finance, the government’s export credit agency, will be allowed to back larger loans for foreign or domestic companies that want to start shipping from the U.K., the Financial Times said, in a bid to attract foreign investment to the country. Previous Conservative governments in the U.K. failed to achieve the same export target by 2020, and the country only increased overseas sales to 689 billion pounds by 2019 before the pandemic hit.

https://www.bloomberg.com/news/articles/2021-11-14/u-k-to-set-1-trillion-pound-p...


US EXIM focus on Africa

(JD Supra, Sausalito, 15 November 2021) Africa is a priority for Biden administration agencies the International Development Finance Corporation and EXIM. As of the end of 2020, DFC had invested approximately US$8 billion (approximately 25 percent of its total portfolio) across more than 300 projects on the continent. During 2009 – 2019, EXIM supported US$12.4 billion of transactions to sub-Saharan Africa,11 and the region is home to EXIM's largest commitment to date. Moreover, EXIM is a long-time player in Africa, with experience dating back to the 1940s. The agency is currently open for business in 44 of the 49 countries across sub-Saharan Africa. In March 2020, it approved a US$91.5 million transaction for electrification in Senegal.12 Two months later, the agency approved its largest transaction to date: a US$4.7 billion credit (direct loan) supporting exports of US goods and services with more than 60 US suppliers to assist the development and construction of an integrated liquefied natural gas project on the Afungi Peninsula in northern Mozambique.13 EXIM made its commitment alongside those from almost 20 other ECAs and DFIs, which offered an aggregate of US$16 billion in loans.

https://www.jdsupra.com/legalnews/us-government-agencies-focus-on-africa-1823459


British Airways secures another £1bn UKEF-backed facility

(CH-Aviation, Stansstad, 2 November 2021) British Airways has reached an agreement with UK Export Finance (UKEF) and a syndicate of banks for a five-year Export Development Guarantee committed Credit Facility (UKEF Facility) of GBP1.0 billion pounds (USD1.37 billion). According to parent firm IAG International Airlines Group, this is in addition to a GBP2.0 billion (USD2.74 billion) UKEF guaranteed facility that was announced in December 2020 and drawn in March 2021. IAG, which aside from British Airways also owns Iberia, Vueling Airlines, Aer Lingus, and LEVEL, said that as of the end of September, its total cash pile stood at a "strong" EUR10.6 billion euro (USD12.26 billion).

https://www.ch-aviation.com/portal/news/109226-british-airways-secures-another-1...


Norwegian ECA supports North Pole cruising in style

(AME Info, Dubai, 7 November 2021) A Swedish aviation company, OceanSky Cruises, announced that it will start cruises to the North Pole aboard luxury airships starting from 2024. The aviation industry made up 2.5% of the total CO2 emissions in 2018 alone, or double the amounts since the mid-1980s. Now, a Swedish aviation company, OceanSky Cruises, announced it will start cruises to the North Pole aboard luxury airships starting from 2024. Norwegian export credit agency Eksfin is playing a major role in accelerating the ‘green shift’ at sea, providing loan guarantees approaching €1 billion ($1.16 bn) for the construction of 35 eco-friendly vessels over the last four years, including ‘Le Commandant Charcot’.

https://www.ameinfo.com/tech-and-mobility/cruise-the-north-pole-in-style-by-air-...


Lithuania to get U.S. EXIM trade support as it faces China fury over Taiwan

(Reuters, Vilnius, 19 November 2021) Lithuania will sign a $600 million export credit agreement with the U.S. Export-Import Bank next week, Economy Minister Ausrine Armonaite told Reuters, days after China warned it would "take all necessary measures" after Lithuania allowed Taiwan to open a de facto embassy. China demanded in August that the Baltic state withdraw its ambassador to Beijing and said it would recall China's envoy in Vilnius after Taiwan announced its office would be called the Taiwanese Representative Office in Lithuania.

https://www.reuters.com/business/lithuania-get-us-trade-support-it-faces-china-f...


New OECD down payment requirements set to boost ECA support in emerging markets

(Global Trade Review, London, 10 November 2021) The OECD has relaxed down payment rules for transactions involving export credit agencies (ECAs) in emerging markets, in the wake of what it calls a “market failure” in the private sector. Under the new rules, the OECD Arrangement on Officially Supported Export Credits has slashed the down payment requirement from 15% to 5% for sovereign borrowers in developing markets, so long as the transaction is guaranteed by a ministry of finance or central bank. The policy, which comes into immediate effect, thereby also increases the maximum amount participating ECAs can officially support from 85% to 95% of the total export contract value.

https://www.gtreview.com/news/global/new-oecd-down-payment-requirements-set-to-b...


Russians Discuss Increased Engagement With Africa

(Eurasia Review, Albany, 10 November 2021) Russia’s weak economic presence in Africa has become a thing of concern for some experts in the country and they wonder why the nation is not aggressive with this like its ally, China. Smaller countries such as Turkey is visibly broadening its economic influence and so are a number of Gulf States. In July 2021, participants at the Association of Economic Cooperation with African States (AECAS), established under the aegis of the Secretariat of the Russia-Africa Partnership Forum (RAPF), agreed that lack of financial support was the major reason for this. The forum, which had in attendance some leading Russian companies and banks, discussed an effective system of financing projects and supporting investment in Africa. Nikita Gusakov, Head of the Russian Export Credit and Investment Insurance Agency (EXIAR), reiterated that Africa was a priority for the agency, outlining a number of deals that EXIAR has been involved in on the continent.

https://www.eurasiareview.com/10112021-russians-discuss-increased-engagement-wit...


What's New October 2021

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.

  • New OECD coal financing restrictions represent weak progress
  • ECAs provide billions to fossil fuel projects yearly - Join us at COP26
  • European Commission opens consultation on extending temporary State export credit aid
  • SACE Could Support Novatek's Giant Arctic LNG 2 Project
  • NGOs release the 2021 Global Coal Exit List: 1000 companies driving the world towards climate chaos
  • Ukraine in talks with Britain on supply of missiles
  • Export credit agencies have stepped up during the pandemic
  • Canada won’t stop Crown corporations from investing in fossil fuels any time soon
  • Export Finance Australia offers A$2bn (US$1.5 B) in critical mineral loans
  • UKEF £1.5bn earmarked for Nigeria ‘largely untouched’
  • ECAs of UAE and France sign strategic reinsurance agreement
  • Will a Taliban victory advance TAPI pipeline with ECA support?
  • JBIC and Private Banks Must Reconsider Decision to Finance LNG Canada Project

New OECD coal financing restrictions represent weak progress

(Oil Change International, Washington, 22 October 2021) Today the OECD Export Credit Group announced new restrictions on its support for overseas coal projects. These restrictions build on the Coal-Fired Electricity Generation Sector Understanding that was negotiated in 2015 and went into effect 1 January 2017. That agreement prevented OECD-member export credit agencies (ECAs) from supporting coal-fired power plants that were less efficient unless they were in developing countries. Unfortunately, there were loopholes that allowed for continued support even for coal plants that did not meet these restrictions. Today’s restrictions would end ECA support for coal plants that do not have carbon capture, utilisation and storage (CCUS) equipment in place. Still some export of equipment for retrofitting plants with CCUS or reducing emissions will be allowed if lifetime and capacity of coal plants is not extended. The restrictions do not address export finance for coal mines and related infrastructure, nor oil and gas financing even if the latest IEA report shows that investments in new fossil fuel production need to end this year to limit warming to 1.5°C.

http://priceofoil.org/2021/10/22/new-oecd-coal-financing-restrictions-represent-...


ECAs provide billions to fossil fuel projects yearly - Join us at COP26

(ECA Watch, 27 October 2021) We can’t solve the climate crisis if export credit agencies (ECAs) continue to bankroll fossil fuels. Tell the governments behind these agencies to immediately end all export credit and other public financial support for oil, gas and coal.
Join our side event at COP26 November 4, 2021 in Glasglow
At COP26 on November 4, 2021, 16.45-18.00 Glasgow time representatives from NGOs and Zurich-based universities will host a digital side event on aligning export finance with the Paris Agreement. Contrary to Article 2.1c of the Paris Agreement, many countries heavily support fossil fuel investments abroad, contributing to carbon lock-in. By highlighting the impacts caused by export finance in the Global South, this side event will provide concrete recommendations for decarbonizing export finance. The speakers on the panel are Axel Michaelowa (University of Zurich); Kate DeAngelis (Friends of the Earth US); Bjarne Steffen (ETH Zurich); Laila Darouich (Perspectives Climate Research); Ayumi Fukakusa (Friends of the Earth Japan); Richard Matey (Alliance for Empowering Rural Communities, Ghana) ; Julio Bichehe (Farmers Union Cabo Delgado Mozambique); and Mariane Søndergaard-Jensen (Danish ECA, EKF, Denmark).
To attend the side event digitally, please register using the form. We’ll keep you updated on when and where the event will take place.
Important: you will need to be registered at COP26 to be able to join the event.

https://www.fossilfreeecas.org/


European Commission opens consultation on extending temporary State export credit aid

(Lexology, London, 4 October 2021) The European Commission launched a consultation process on 30 September 2021, sending a proposal to Member States on a sixth draft amendment to the Temporary Framework on State aid measures to support member economies in the current COVID-19 outbreak. The Temporary Framework sets out various categories of aid [subsidies?] that can be implemented by Member States, one of which is more flexible rules on short-term export credit (which are not covered by the OECD Arrangement), permitting state aid via export credit insurance to riskier countries, allowing generous financial terms beyond fair market competition. The Commission proposes to extend until 30 June 2022 the temporary removal of all countries from the list of “marketable risk countries” under Annex 1 of the Communication on short-term export credit insurance. Marketable risk countries are those which may have risks due to exchange rate volatility, foreign exchange control regulations, lack of foreign exchange for repayment, etc.

https://www.lexology.com/library/detail.aspx?g=336f1b43-f7e8-4b88-96f5-03ca41990...


SACE Could Support Novatek's Giant Arctic LNG 2 Project

(Offshore Enginer, New York, 22 October 2021)Italy's biggest banking group Intesa Sanpaolo could help fund Novatek's Arctic LNG 2 project even as some European governments show lukewarm support for the giant Russian gas project. Antonio Fallico, chairman of group unit Banca Intesa Russia, told Reuters the bank had been invited to look at the financing deal by SACE, the state-owned Italian export credit agency. Novatek said in September they had credit lines open for a third of the total financing from Russian banks, adding Chinese and Japanese banks could provide the rest. The pressure on institutional investors from climate lobby groups to stop funding fossil fuel companies has intensified markedly in recent years. The $21 billion project, which received final investment approval in 2019, is expected to reach full capacity of almost 20 million tonnes of LNG per year in 2026.

https://www.oedigital.com/news/491523-italian-bank-could-fund-novatek-s-giant-ar...


NGOs release the 2021 Global Coal Exit List: 1000 companies driving the world towards climate chaos

(Urgewald, Berlin, 6 October 2021) Three weeks before the start of the UN Climate Summit in Glasgow, Urgewald and 40 partner NGOs have released the 2021 update of the “Global Coal Exit List” (GCEL). The GCEL provides detailed data on 1,030 companies and around 1,800 subsidiaries operating along the thermal coal value chain. It is the world’s most comprehensive public database on the coal industry.

https://urgewald.org/en/medien/ngos-release-2021-global-coal-exit-list-1000-comp...


Ukraine in talks with Britain on supply of missiles

(Goa Spotlight, London, 21 October 2021) The UK is negotiating with Ukraine on the sale of the first ever consignment of weapons, in particular missiles, the Times newspaper writes with reference to a Ukrainian source. As part of the discussed agreements, London may supply Kiev with ground-to-ground missiles and aircraft missiles. The UK Ministry of Defense, according to the newspaper, is also discussing the sale of Brimstone missiles to Kiev, developed by the MDBA consortium, for installation on the ships of the Ukrainian Navy. In addition, the parties are considering the possibility of supplying air-launched Brimstone missiles, their cost is about $ 138,000. According to some reports, according to the Times, negotiations on the supply of weapons to Ukraine may also be linked to the construction of the Nord Stream 2 pipeline. The talks are prompted by the strengthening of relations between Kiev and London after the UK left the European Union. In October last year, Ukrainian leader Volodymyr Zelenskyy signed a contract with the UK Export Credit Agency, which deals with the supply of modern military equipment and the latest high-precision weapons to Kiev, types of military products in Ukraine, as well as the construction of bases for the Ukrainian Navy.

https://thegoaspotlight.com/2021/10/21/times-ukraine-is-in-talks-with-britain-on...


Export credit agencies have stepped up during the pandemic

(Financial Times Trade Secrets, Budapest, 26 October 2021) The industry has helped backstop sectors such as airlines hit hard by Covid, saving companies and jobs. An interview with the head of the Berne Union, an association of export credit agencies, to find out how it is helping exporters arm themselves against the downsides of the pandemic through export credit and insurance. The Berne Union operates all over the world allowing countries such as the US and China or Iran and Israel to discuss trade issues freely at Berne Union conferences, with political considerations mostly taking a back seat. It was that environment of co-operation that helped ensure exporters did not go out of business permanently when coronavirus effectively shut down cross-border movement during the spring of 2020. Over the course of the pandemic, members of the Berne Union provided $2.5tn in cover, its president Michal Ron told Trade Secrets. All in all, the volume of business supported by members rose 2.4 per cent between 2019 and 2020. “We have ECAs that are government agencies directly under a ministry,” she said. “Others are joint stock companies with a government-based shareholder. Some simply use direct government funding — it depends.

https://www.ft.com/content/113e8e3e-8984-45d2-92b8-c97b3c829ab8


Canada won’t stop Crown corporations from investing in fossil fuels any time soon

(Peterborough Examiner, 18 October 2021) The federal government has no plans to immediately stop Crown corporations from financing fossil fuel companies, but it’s not ruling out pushing them to reduce those supports more quickly, says Canada’s environment minister. The issue of public financing for oil and gas companies is expected to be on the agenda at the next major world summit on climate change this month, where countries that signed the 2016 Paris Agreement — including Canada — are under pressure to increase efforts to reduce their annual greenhouse gas emissions. A major report from leading scientists this summer prompted the United Nations’ secretary general to herald the “death knell” for fossil fuels that have driven emissions for decades. In an interview Friday, federal Environment Minister Jonathan Wilkinson told the Star that Crown institutions like Export Development Canada (EDC) are already committed to “net-zero” emissions — when nature or technology can remove remaining greenhouse gas pollution from the air — by 2050. Big money is in play here. EDC, the government’s export credit agency, says it provided financing and insurance that helped facilitate $62 billion in business for Canadian oil and gas companies from 2015 to 2020. And the board that invests the Canada Pension Plan’s $500-billion pool of money says it had about $17.6 billion invested with fossil fuel producers around the world as of March 2021.

https://www.thepeterboroughexaminer.com/ts/politics/federal/2021/10/18/canada-wo...


Export Finance Australia offers A$2bn (US$1.5 B) in critical mineral loans

(Global Trade Review, London, 6 October 2021) The Australian government has created a A$2bn (US$1.5bn) loan facility to spur investment in the country’s critical minerals sector, as it attempts to position Australia at the source of supply chains for technologies such as battery storage and electric vehicles. The facility will be provided through the National Interest Account (NIA) of Export Finance Australia (EFA), the country’s export credit agency. The NIA handles transactions that the government directs EFA to support. Minerals such as lithium, cobalt, titanium and rare earth elements are categorised as critical minerals because they are relatively scarce or geographically concentrated, difficult to substitute and are used in emerging technologies including large batteries. China is currently the biggest exporter of many of the minerals, with Australia another top supplier.

https://www.gtreview.com/news/asia/australian-government-offers-a2bn-in-critical...


UKEF £1.5bn earmarked for Nigeria ‘largely untouched’

(PUNCH Nigeria, Lagos, 24 October 2021) The £1.5bn financing set aside for Nigeria by the UK Export Finance, the United Kingdom government’s export credit agency, has remained largely untouched, the UK Government Department for International Trade, Nigeria has said at the 2021 Energy Sustainability Conference organised by the Energy Institute Nigeria in Lagos. “UKEF is focussed on 30 countries in Africa with a combined market risk appetite of £58bn." According to Chimwemwe Chalemera, Country Director, UK Government Department for International Trade, Nigeria, the UK’s renewable energy capabilities are a right match with the energy needs of Africa and Nigeria in achieving net zero ambitions. Meanwhile over 50 Nigerian civil society groups have written to President Buhari calling for oil in the massive OPL 245 field to be kept in the ground. This is the field that Shell and Eni acquired after allegedly paying $1.1 billion in bribes. The companies' subsidiaries are currently being prosecuted in Nigeria and there is still an investigation in The Netherlands.

https://punchng.com/1-5bn-earmarked-for-nigeria-largely-untouched-says-uk/


ECAs of UAE and France sign strategic reinsurance agreement

(Insurance News Net, Dubai, 5 October 2021) Etihad Credit Insurance (ECI), the UAE Federal export credit company and the French Export Credit Agency Bpifrance Assurance Export have signed a reinsurance agreement to increase joint Emirati and French projects globally. The agreement will further strengthen the robust trade and economic cooperation between the UAE and France and boost exports in both countries by providing export insurance solutions for Emirati and French companies. The UAE is France’s second-largest trade partner in the region. As part of boosting investment and trade ties, ECI earlier signed agreements with its counterparts in  the UK and Italy. The agreement with France has been deemed another milestone in ECI's mission to deepen the UAE's economic ties and non-oil trade.Saudi Arabia and Sweden have also discussed enhancing economic cooperation including via their ECAs.

https://insurancenewsnet.com/oarticle/export-credit-agencies-of-uae-and-france-s...


Will a Taliban victory advance TAPI pipeline with ECA support?

(Natural Gas World, Vancouver, 19 October 2021) The Taliban’s ascent is driving renewed discussion about the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline. Taliban spokesman Suhail Shaheen said on August 18 that TAPI is a “long-term priority project” that the Taliban fully supports. Since the fall of the Soviet Union, energy companies have pondered routes to send natural gas from gas-abundant yet land-locked Turkmenistan to energy-poor Pakistan and onward to India. The Berdimuhamedov government of Turkmenistan and the Asian Development Bank (ADB) have made this pipeline a priority for years, but it has long been on life support, with the project’s press releases failing to obscure its grim deficits. the project is strapped for cash. The ADB has indicated it will contribute $1 billion in loans. The Turkmen government, grappling with a massive economic crisis, has risibly pledged $1.675 billion. The remainder is envisioned to come from export credit agencies and commercial lenders, all lending individually to the four governments and relying on sovereign guarantees from each country. What is an Afghan sovereign guarantee worth?

https://www.naturalgasworld.com/will-a-taliban-victory-advance-tapi-93055


JBIC and Private Banks Must Reconsider Decision to Finance LNG Canada Project

(Friends of the Earth Japan, Tokyo, 29 October 2021) The Japan Bank for International Cooperation (JBIC), a public financial institution fully owned by the Government of Japan, announced in a press release today that it has decided to provide up to US $850 million for the LNG Canada Project. The LNG Canada project plans to liquefy shale gas extracted from Montney, British Columbia and transported through its 670 km Coastal Gaslink pipeline to Kitimat for export to Asian markets.The decision by JBIC ahead of the 26th session of the Conference of the Parties (COP 26) to the United Nations Framework Convention on Climate Change (UNFCCC) starting from the end of this week in Glasgow, England, goes against the call by the UK government to stop public financing for fossil fuels, and shows that Japan's approach to climate change is still far from that of the rest of the world. It is inevitable that Japan will once again become the target of criticism from the international community. Serious violations of indigenous peoples rights have been pointed out in an associated project of the LNG Canada project. We strongly condemn JBIC's decision to provide financing, disregarding the impact on climate change and the human rights of Indigenous Peoples, and call on involved operators and financial institutions to immediately withdraw from the project.

https://www.foejapan.org/en/aid/jbic02/lngcanada/211029.html


What's New September 2021

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.

  • U.S., Europe at OECD Seek to End Export Financing for Coal
  • New report reveals German government sabotages international energy transition
  • SACE and NEXI finance large carbon bomb vessel for Dutch SBM Offshore
  • UKEF is ‘exaggerating’ the number of businesses helped
  • Aligning export finance to sustainable development goals
  • UKEF targets net zero emissions by 2050
  • Swedish ECA launches Green Guarantee to promote climate investments
  • ECAs and the Impact of Plastics on Human Rights
  • SACE says exports to return to pre-COVID levels this year
  • Exim India extends $100 mn loan to Africa Finance Corp for infra development
  • SACE backs Lima Metro Line 2
  • Saudi EXIM Bank signs a reinsurance agreement with ICIEC
  • Will ECAs support Afghan projects under the Taliban

U.S., Europe at OECD Seek to End Export Financing for Coal

(Wall Street Journal, Paris, 14 September 2021) The U.S., the European Union, South Korea and other wealthy nations are moving to forbid their export-financing agencies from supporting coal-fired power projects overseas, in an effort to end government support for a fuel that is one of the world’s biggest sources of greenhouse gases. The proposed ban, which will be made this week at the Organization for Economic Cooperation and Development, is part of the West’s campaign to push China, India and other big developing countries to take a tough position against coal ahead of the November climate summit in Glasgow, Scotland. China and India have resisted entreaties by the U.S. and Europe to commit to end subsidies for coal-fired electricity, raising fears that deadlock over the issue could result in the collapse of climate negotiations in Glasgow. The OECD, a Paris-based organization of 38 developing and developed economies, oversees an agreement governing export-credit agencies, which provide financing for overseas customers of the countries’ domestic companies. The U.S., the 27 nations of the EU, the U.K., Norway, Switzerland, Japan, Australia, South Korea, New Zealand and Turkey are signatories of the deal. In other news the US Treasury has instructed representatives at multilateral development banks to support clean energy projects over fossil fuels, putting the fate of several gas projects in the balance. Interestingly no news could be found on the OECD website today on the results of the OECD coal negotiations on September 15-16. The OECD web site divulges no results at all for searches re export credit and their ECA work page is burried very deep in their site map and shows no postings since September 8th. Indications are that there were differences over the definition of "unabated coal fired plants" to be banned, whether to include gas and mining or transport of coal. Further meetings are planned for October 12th and 20th. As world leaders met for a high level dialogue on energy at the UN in New York, 200 green groups urged them to embrace renewables and stop financing all fossil fuels.

https://www.wsj.com/articles/u-s-europe-seek-to-end-export-financing-for-coal-11...


New report reveals German government sabotages international energy transition

(Urgewald, Berlin, 15 September 2021) A new report by the environmental organisations urgewald and Deutsche Umwelt-Hilfe (DUH) shows that the German government is supporting climate-damaging oil and gas projects with guarantees worth billions of euros. In the report, the organisations examine climate-damaging oil and gas-related export credit guarantees as well as untied loan guarantees (UFK guarantees) for the period 2015 to May 2021. During this time, the German government approved 144 export guarantees in the oil and gas sector with a total volume of more than 11.75 billion euros via Euler Hermes AG. Of the 28 countries in which oil and gas guarantees were granted, 15 are considered "not free", according to Freedom House. The report is based on data made available to the two organisations by the German government through a Freedom of Information Act request.

https://www.eca-watch.org/publications/new-report-reveals-german-government-sabo...


SACE and NEXI finance large carbon bomb vessel for Dutch SBM Offshore

(Offshore Technology, London, 16 September 2021) Dutch floating production storage and offloading (FPSO) operator SBM Offshore has completed the largest project financing in its history, of the vessel FPSO Sepetiba, for a total of $1.6bn. SBM Offshore was established in 1862 and its main activity is to design, supply, install, operate, and maintain FPSO vessels. It accounts for over 1,660,000 [barrels?] of total fleet oil production capacity. The project financing was secured by a consortium of 13 international banks, with insurance cover from Nippon Export and Investment Insurance and SACE. The vessel has a processing capacity of up to 180,0000 (sic) barrels of oil per day, a water injection capacity of 250,000 barrels per day, associated gas treatment capacity of 12mmscm, and a minimum storage capacity of 1.4mmbbl. It will be moored in approximately 2,000m water depth and will be deployed at the Mero field in the Santos Basin offshore Brazil. The Libra block, where the Mero field is located, is under a production sharing agreement with a consortium comprised of Petrobras as the operator with 40% interest; Shell with 20%; TotalEnergies with 20%; China Southern Petroleum Exploration and Development Corporation with 10%; and China National Offshore Oil Corporation with 10% interest. Petrobras, a state-owned Brazilian multinational corporation in the petroleum industry, awarded a contract to SBM Offshore for the 22.5 years lease and operation of the FPSO for the Mero field in December 2019. The Guardian notes that carbon bombs, gigantic coal, oil and gas projects from around the world, if they go ahead, will raise global emissions and cause dangerous climate change.

https://www.offshore-technology.com/news/sbm-offshore-largest-project-financing/


UKEF is ‘exagerating’ the number of businesses helped

(The Times, London, 20 September 2021) The UK's UKEF has been accused of exaggerating how many businesses it has supported, of undermining the national drive towards net-zero carbon emissions and of doing too little to help smaller exporters. MPs on the Commons’ international trade committee said that UK Export Finance had directly helped far fewer companies than its “headline figure of 549 businesses supported” in the 2020-21 financial year, with only 167 directly applying for finance and insurance. Global Trade Review also notes that the government inquiry into the work of UKEF has raised concerns over the agency’s concentration of support in certain sectors, ambiguous figures in its annual accounts, and potential exposure to environmental and human rights issues.

https://www.thetimes.co.uk/article/government-s-export-credit-agency-is-exaggera...


Aligning export finance to sustainable development goals

(Bizcommunity, Cape Town, 23 September 2021) A clear call to action to rethink the sustainability performance of the export finance market has come out of an International Chamber of Commerce (ICC) white paper. Released at a major event during United Nations (UN) General Assembly week and developed with the support of the Rockefeller Foundation and 16 leading banks, the white paper explores how the US$700bn export finance industry can significantly increase its contribution to the achievement of the UN Sustainable Development Goals (SDG) and the Paris climate accord.

https://www.bizcommunity.com/Article/196/516/220414.html


UKEF targets net zero emissions by 2050

(Energy Live News, London, 23 September 2021) The UKEF has committed to making all of its £50 billion capacity carbon-neutral by 2050 on a net basis. Through its new climate strategy, the country’s export credit agency will increase its support for clean growth, renewables and climate adaptation exports. UKEF currently has a £50 billion capacity to support UK exports through loans and insurance. Through the new agreement, this capacity will be entirely carbon-neutral by 2050 on a net basis. It hopes its actions can inspire more financial institutions to take action ahead of COP26 in less than 50 days. Anne-Marie Trevelyan, International Trade Secretary, said: “UKEF’s net zero pledge shows the UK’s climate leadership and is an encouragement for other countries to follow suit. Meanwhile, a South West Business Council survey of companies finds many are not prepared to tackle emmissions and many have yet to be convinced about the economic benefits of going green and want financial support to achieve it.

https://www.energylivenews.com/2021/09/23/ukef-targets-net-zero-emissions-by-205...


Swedish ECA launches Green Guarantee to promote climate investments

(EKN, Stockholm, 15 September 2021) EKN launches a new credit guarantee to facilitate financing of green exports as well as green transition projects within Swedish exporting companies. The new guarantee covers the bank’s risk up to 80 percent instead of previously 50 percent, which increases the capacity for credit. It is offered to companies with direct or indirect exports that contribute to the climate transition. The assessment criteria’s will be based on the EU-taxonomy. EKN’s Green Guarantee covers both working capital and financing of a specific investment, in businesses contributing to the climate transition. In addition, a Scientific Climate Council, a group of academic experts, will provide advisory support to the Swedish Export Credit Agency (EKN) and the Swedish Export Credit Corporation (SEK) to assist aligning the Swedish export finance system with the Paris Agreement’s 1.5°C goal, according to a SEK press release. The climate council is the first of its kind in the world and will focus on issues such as the role of natural gas for the energy transition in low- and middle-income countries.

https://www.ekn.se/en/about-ekn/newsroom/archive/2021/press-releases/green-guara...


ECAs and the Impact of Plastics on Human Rights

(IISD, Winnipeg, 16 September 2021) A UN Special Rapporteur has issued 2 reports on human rights in the area of hazardous substances. The report calls for phasing out subsidies and export credit and guarantees for fossil fuel extraction, plastics production facilities, and plastic-to-energy projects. One report addresses the stages of the plastics cycle and their impacts on human rights, and focuses on the right to science in the context of toxic substances. Marcos Orellana, the UN Human Rights Council Special Rapporteur on the implications for human rights of the environmentally sound management and disposal of hazardous substances and wastes, writes that the global plastics crisis reveals how every stage of the plastics cycle, including extraction and refining, production, transport, use, and waste. has adverse effects on the full enjoyment of human rights. The report (A/76/207) includes recommendations to address the negative consequences of the plastics cycle on human rights and integrate a human rights-based approach in transitioning to a chemically safe circular economy.

http://sdg.iisd.org/news/special-rapporteur-highlights-right-to-science-impact-o...


SACE says exports to return to pre-COVID levels this year

(ANSA, Rome, 14 September 2021) The global economy's rebound from the effects of the COVID-19 pandemic will see Italian exports return to pre-pandemic levels this year and grow further in the coming years, export credit agency SACE said in a report on Tuesday. SACE forecast that Italian exports would increase 11.3% this year, with foreign sales of Italian goods worth 482 billion euros. It said exports would then grow by 5.4% in 2022 and by 4% in 2023.

https://www.ansa.it/english/news/business/2021/09/14/exports-to-return-to-pre-co...


Exim India extends $100 mn loan to Africa Finance Corp for infra development

(Business Standard, New Delhi, 31 August 2021) Exim Bank of India has extended a line of credit of $100 million on behalf of the Indian government to the Africa Finance Corporation (AFC) to develop infrastructure in the continent and boost economic revival of countries in the region, infrastructure required for the revival of Africa's economies in the wake of the COVID-19 pandemic.

https://www.business-standard.com/article/finance/exim-bank-extends-100-mn-loan-...


SACE backs Lima Metro Line 2

(Global Legal Chronicle, Rome, 2 September 2021) A syndicate of lenders, including Cassa Depositi e Prestiti, KfW IPEX-Bank, Société Générale, Banco Santander and Instituto de Crédito Oficial E.P.E. – ICO, provided a US$811 million syndicated credit facility backed by the Italian export credit Agency SACE, involving the securitization of Peruvian government-backed payment rights for the extension of Lima's Metro Line 2. The export credit agency-backed syndicated loan involved a securitization of RPI-CAOs and will be used to finance the development and construction of the Lima Metro Line 2 and is the largest RPI-CAO deal ever financed under a credit facility financing structure in Peru.

https://www.globallegalchronicle.com/lima-metro-line-2s-securitization-and-eca-b...


Saudi EXIM Bank signs a reinsurance agreement with ICIEC

(Saudi Gazette, Jeddah, 3 September 2021) The Saudi Export-Import Bank (EXIM Bank) has signed an agreement with the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), to launch a special insurance product that helps Saudi banks to provide more credit facilities for the export of Saudi non-oil products, and enable them to increase their ability to enhance letter of credit received from foreign banks for the benefit of Saudi exporters.

https://saudigazette.com.sa/article/610535/SAUDI-ARABIA/EXIM-Bank-signs-a-reinsu...


Will ECAs support Afghan projects under the Taliban

(Bloomberg Opinion, 7 September 2021) In an opinion written for Bloomberg, the former Governor of the central bank of Afghanistan (DAB) notes: "There are optimistic suggestions that the hard-won integration of Afghanistan into the global economy will remain despite the ascendancy of the Taliban and the withdrawal of the U.S. A number of commentators have suggested that China — which the Taliban have declared their strongest ally — could become Afghanistan’s primary economic supporter and help the country stay part of the global system. That analysis is unrealistic. For one, it ignores the sanctions regime imposed by the international community on the Taliban... Afghanistan’s physical money supply will be impaired. This is because the central bank does not print its own currency: DAB typically receives afghanis produced by specialist firms overseas... I am relatively certain that these deliveries cannot be made... Second, the $7 billion Turkmenistan-Afghanistan-Pakistan-India natural gas pipeline project (TAPI) will likely not proceed. This pipeline would have brought 33 billion cubic meters of natural gas annually from the Turkmen Galkynysh field — the world’s second largest — to  Pakistan and India. It would have generated a few hundred million dollars in transit revenues for the Government of Afghanistan... As a result of the sanctions regime and security concerns, European companies will not be able to provide equipment or the financing. They will certainly not be able to obtain insurance for the project. For now, the project has to be assumed to be dead... Third, hopes to profit from the country’s mineral resources have to be scaled back — or abandoned... these projects requires international financing and more... The Taliban will face the same economic challenges as the previous regime — but under sanctions and with much less international financial support. Afghanistan’s new rulers must face this reality, form an inclusive government and adhere to international standards. Otherwise, they will further impoverish themselves and the Afghan people."

https://www.bloomberg.com/opinion/articles/2021-09-07/the-taliban-can-t-mint-mon...


What's New August 2021

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.

  • Lexology report: Export Credit Agencies and Insurers
  • How ECAs can catch up on climate action
  • Swedish ECAs establish scientific climate council to help align with Paris Agreements
  • Can China green the Belt and Road?
  • Chinese banks and ECAs stay silent on human rights allegations
  • Australian banks defend coal exit
  • Cost of Hoima-Tanga Pipeline Hits $5b As Risk Averse Supporters Walk Away
  • World Economic Forum warns global trade finance gap could reach $2.5 trillion by 2025
  • Experts Discuss Russia’s Weak Economic Presence in Africa
  • UKEF to forge closer trade ties with Central America
  • Middle East Oil Refinery (MIDOR) in Egypt to start partial operations this year
  • NEXIM: Promoting Social Inclusion With WAYEF
  • UKEF finances 6 hospitals in Ivory Coast

Lexology report: Export Credit Agencies and Insurers

(Lexology, London, 24 August 2021) ASHURST LLP has produced a 12 page overview of official export credit agencies in the EU, OECD, UK and globally, which broadly reviews ECA history, policies, competition, budgets, sector agreements, etc. It notes that as recently as the turn of the century, the OECD Arrangement was understood to cover the vast majority of export credits globally, whereas US EXIM now estimates that in 2019 total activity provided under the rules of the OECD arrangement amounted to only 34% of total export and trade-related finance - approximately US$76 billion. The OECD arrangement is described as a 'gentlemen's agreement' among its participants, seeking to ensure there is not a race to the bottom or a crowding out of private financing options that could lead to public resources subsidising exporters. The participants to the Arrangement claim that, despite its voluntary nature, the international cooperation that regulates ECA operations has been a mainstay of the market for decades, looking to ensure that competition remains on the quality and pricing of goods and services rather than the financing terms, i.e. subsidies. However they admit that the core purpose of ECAs is to promote exports to provide jobs domestically and increase the wealth of the country they originate from. Meanwhile, ECA Watch maintains that monitoring of the implementation of the OECD Arrangement, its sectoral agreements as well as the Common Approaches on social and environmental due diligence for officially supported export credits, remains seriously inadequate. The lack of transparency in the application of due diligence procedures results in official ECA support for multiple projects to contravene international environmental, human rights and other treaties and agreements to which these ECAs' own governments are parties. While a somewhat useful overview of complex ECA agreements and practices, the report neglects the significant contraventions of international rights and the resultant trauma caused by so many official ECA supported projects on people and their families across the globe.

https://www.lexology.com/library/detail.aspx?g=b123cf04-f8b9-4b8f-aa57-f8b525ebb...


How ECAs can catch up on climate action

(Global Trade Review, London, 4 August 2021) Export credit agencies (ECAs) are lagging private financial institutions in setting targets for reaching net zero greenhouse gas emissions and are missing opportunities as the energy transition gets underway. That’s the argument of a University of Oxford paper published last week by a group of five researchers, including experts in trade, law and economics. Former Bank of England governor Mark Carney says in the paper’s foreword that ECAs “are increasingly conspicuous by their absence” in efforts by financial institutions to back a transition away from fossil fuels.
 

https://www.gtreview.com/news/global/export-credit-agencies-can-catch-climate-ac...


Swedish ECAs establish scientific climate council to help align with Paris Agreements

(EKN/SEK, Stockholm, 26 August 2021) The Scientific Climate Council, a group of academic experts, will provide advisory support to EKN and SEK to assist aligning the Swedish export finance system with the Paris Agreement’s 1.5°C goal. The climate council is the first of its kind in the world and will focus on issues such as the role of natural gas for the energy transition in low- and middle-income countries. EKN’s and SEK’s climate transition efforts are at the forefront from a global perspective. Stringent requirements are set for projects that receive guarantees and credits and the Swedish export finance system was one of the first to cease export financing the extraction and transportation of coal.

https://www.ekn.se/en/about-ekn/newsroom/archive/2021/press-releases/ekn-and-sek...


Can China green the Belt and Road?

(China Daily, Beijing, 9 August 2021) The Chinese government issued a policy on July 16 encouraging Chinese businesses to integrate green development through overseas investment and cooperation. The document, titled "Green Development Guidelines for Overseas Investment and Cooperation", was jointly issued by the Ministry of Commerce and the Ministry of Ecology and Environment. The guidelines recommend that Chinese businesses support investments in clean energy and also cover trade, by requiring companies to speed up integration with the global green supply chain, carry out green procurement and purchase environmentally friendly products and services. The guidelines are specifically addressed to some of the most important financial institutions: the China Development Bank, China Import-Export Bank and Sinosure, China's export credit agency. In June this year, the Belt and Road Initiative International Green Development Coalition, ClientEarth and the Beijing Institute of Finance and Sustainability conducted a two-day workshop on environmental and climate risk mitigation with the largest financial institutions in the Belt and Road Initiative. Although the process is not without difficulties, these institutions are developing key policies, such as categorization of projects based on environmental risks, requirements for environmental standards, impact assessments, third-party evaluations, information disclosure and public participation, grievance mechanisms, and even potential fossil fuel exclusion policies.

http://www.chinadaily.com.cn/a/202108/09/WS611066b4a310efa1bd667753.html


Chinese banks and ECAs stay silent on human rights allegations

(Global Trade Review, London, 11 August 2021) Chinese banks have a “dismal” rate of engagement with concerns about the human rights impacts of their overseas investments, a new report says. The London-based Business and Human Rights Resource Centre (BHRRC) says China’s banks, including private, state-owned and development banks, have responded to only one of 20 requests to answer to human rights concerns raised by civil society organisations. BHRRC said that overall, it has recorded 670 allegations of human rights abuses “linked to Chinese business conduct abroad”. Countries where most complaints are recorded are Myanmar, Peru, Ecuador, Laos, Cambodia and Indonesia. China’s banks’ 5% rate of response to BHRRC requests compares to the Asian and global financial sector’s response rate of 63%.

https://www.gtreview.com/news/asia/chinese-banks-stay-silent-on-human-rights-all...


Australian banks defend coal exit

(Global Trade Review, London, 28 July 2021) Australia’s banks have defended their decision to exit the thermal coal sector and pushed back against suggestions from government lawmakers that they be forced to extend financing to fossil fuels. A flurry of exits from thermal coal businesses that began mainly among European banks and export credit agencies has since spread to Asia. Economies such as South Korea and Japan, which are major buyers of Australian coal and natural gas, have now set ambitious carbon reduction targets ahead of the COP26 summit in Glasgow in November. Australia is the world’s largest coal exporter by value, and coal miners are expected to post bumper profits during the full-year reporting season for listed companies in August. The decision has angered lawmakers in the ruling conservative coalition, many of whom represent communities where coal mines and their supply chains are major employers. Submissions to an inquiry on financing for Australian export industries, launched earlier this year by a parliamentary committee on trade and investment and focusing almost exclusively on thermal coal, included suggestions that the government force banks to lend to any business that is operating legally.

https://www.gtreview.com/news/asia/australian-banks-defend-coal-exit/


Cost of Hoima-Tanga Pipeline Hits $5b As Risk Averse Supporters Walk Away

(All Africa, Cape Town, 23 August 2021) The withdrawal by risk averse lenders from the East African Crude Oil Pipeline has seen the cost of the project rise by 30 percent to $5 billion, meaning shareholders will be forced to dig deeper into their coffers to fund it. Shareholders of TotalEnergies raised this question during the annual general meeting in May, and company executives confirmed that increase in cost to $5 billion for a fully completed project, of which $2 billion will be financed through shareholders' equity and $3 billion by external funding.
Last month, the project also suffered another setback after global insurers and export credit agencies, including French multinational AXA, withdrew its support. "The underlying project is not compatible with our climate commitments," AXA wrote in July, while the UK Export Finance also turned down an application for finance, after the UK government ceased financing fossil fuel projects overseas.

https://allafrica.com/stories/202108230143.html


World Economic Forum warns global trade finance gap could reach $2.5 trillion by 2025

(Euro Money, London, 6 August 2021) The World Economic Forum has warned that the global trade finance gap could reach $2.5 trillion by 2025 as large numbers of funding applications continue to be rejected due to lack of collateral or information from the requesting entities. More than half (60%) of the banks that responded to a survey conducted by the Asian Development Bank just prior to the outbreak of the coronavirus pandemic expected an increase in the volume of trade finance requested by importers and exporters but subsequently rejected. Governments around the world have taken a variety of steps to support trade finance since the start of the pandemic, including increasing the capacity of export credit agencies, expanding working capital programmes and introducing new facilities to support exporters and importers – particularly SMEs.

https://www.euromoney.com/article/28w0si78rh0mqaoj1ze9s/treasury/smaller-firms-t...


Experts Discuss Russia’s Weak Economic Presence in Africa

(Business Post, Lagos, 24 August 2021) Russia’s weak economic presence in Africa has become a thing of concern for some experts in the country and they wonder why the nation is not aggressive with this like its ally, China. In July 2021, participants at the Association of Economic Cooperation with African States (AECAS), established under the aegis of the Secretariat of the Russia-Africa Partnership Forum (RAPF), agreed that lack of financial support was the major reason for this. Nikita Gusakov, Head of the Russian Export Credit and Investment Insurance Agency (EXIAR), reiterated that Africa was a priority for the agency. Senator Igor Morozov, a member of the Federation Council Committee on Economic Policy, and Chairman of the Coordinating Committee on Economic Cooperation with Africa noted during one of the meetings that in conditions of pressure from sanctions, it has become necessary to find new markets, new partners and allies for Russia. “It is important for us to expand and improve competitive government support instruments for business. It is obvious that over the thirty years when Russia left Africa, a number of countries such as China, India, the United States and the European Union have significantly increased their investment opportunities there in the region,” Morozov stressed. With a renewed growing interest in Africa, Russians are feverishly looking for establishing effective ways of entry into the huge continent.

https://businesspost.ng/world/experts-discuss-russias-weak-economic-presence-in-...


UKEF to forge closer trade ties with Central America

(Export Institute, Peterborough, 12 August 2021) UK Export Finance has signed a partnership with CABEI, Central America’s leading development bank, to encourage joint financing of major clean energy, infrastructure and construction projects. Trade between the UK and Central America was worth over £1.7 billion in 2020. At least £2.5bn is now available for new business in each of Guatemala, Honduras and Panama and £1.5bn for Costa Rica, El Salvador and Nicaragua. Countries that can benefit from the joint financing agreement include the Dominican Republic, Panama, Guatemala, Honduras, El Salvador, Nicaragua and Costa Rica. The UK signed a continuity trade deal with Mexico in December and started talks on a £5bn trade deal in March that promised an ‘Aztec-Brexit bounce’. However, as reported in IOE&IT Daily Update, the deal was rendered obsolete after the EU signed a more generous and comprehensive deal between its 27 members states and Mexico. According to a report from the House of Lords’ International Agreements Committee, the UK could now have to wait another three years to catch-up with the EU in trade with Mexico.

https://www.export.org.uk/news/576543/UK-looks-to-forge-closer-trade-ties-with-C...


Middle East Oil Refinery (MIDOR) in Egypt to start partial operations this year

(Construction Review Online, Nairobi, 25 August 2021) Financed to the tune of US$ 1.2bn by a consortium of international banks including CDP Bank, Credit Agricole Bank, and BNP Paribas with the Italian Export Credit Agency (SACE) and the Egyptian Ministry of Finance as guarantors, the Middle East Oil Refinery (MIDOR) expansion project is being undertaken by TechnipFMC. When fully completed the facility is expected to increase the production of LPG by 107%, high-octane gasoline by 60%, jet fuel by 145%, and diesel by 45%. These are the equivalent of 280,000 million tonnes (Mt), 1.6Mt, 2.2Mt, and 2.8Mt respectively.

https://constructionreviewonline.com/news/middle-east-oil-refinery-midor-in-egyp...


NEXIM: Promoting Social Inclusion With WAYEF

(This Day Alive, Lagos, 8 August 2021) The Nigerian Export Import Bank (NEXIM) has introduced a specific policy intervention that is promoting economic and social inclusion of key segments of the population, in particular women and youth. UN population projections for Nigeria in 2020 indicated that about 62% of Nigerians were below 25 years old; while over 50% are women. The Women and Youth Export Facility (WAYEF) is a deliberate and targeted funding scheme to address the needs of these vulnerable groups notes NEXIM Managing Director Mr. Abba Bello. Over the years, the bank has provided enormous support for many export-oriented industries that are high employers of women and youths such as cashew, shea, hibiscus, ginger among others, where a lot of women are involved in cleaning and packaging of products for export.

https://www.thisdaylive.com/index.php/2021/08/08/nexim-promoting-social-inclusio...


UKEF finances 6 hospitals in Ivory Coast

(Global Construction Review, London, 6 August 2021) UK Export Finance has lent €241m toward a €326m project to build six hospitals in the Ivory Coast, with UK-headquartered NMS Infrastructure Ltd. contracted to do the work. The hospitals will serve a catchment area of more than a million people, and will be built in Bouaké, Boundiali, Katiola, Kouto, Minignan and Ouangolodougou. The financing, a mix of buyer credit and direct lending to Ivory Coast’s Ministry of Health and Public Hygiene, will fund design and construction, equipment, post-completion training and technical support.

https://www.globalconstructionreview.com/uk-finances-six-new-hospitals-million-p...


What's New July 2021

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.

  • Germany accused of hypocrisy over Arctic gas project
  • Australian ECA gives 80X more to fossil fuel projects than renewables
  • EXIM support and the Pemex Ocean fire
  • Export Development Canada Promises Net Zero by 2050
  • UKEF reports export credit arrangements for 2020
  • Australian ECA eyes bid for Pacific telecoms to block China
  • Ghanaian rail project takes off with Swedish & South African ECA backing
  • U.S. Chamber of Commerce supports EXIM
  • U.S. EXIM Bank says 2020 financing volume still far below global rivals
  • SACE helps revive Italian steelmaker Acciaierie d'Italia
  • Insurers mourn missed chance to form EU ECA
  • Afreximbank plans $8 billion fund to offset trade-pact losses
  • New Norwegian ECA, Eksfin, begins operations

Germany accused of hypocrisy over Arctic gas project

(Sky News, London, 16 July 2021) As deadly flooding ravages parts of Germany, the country's government is still considering massive investment in a Russian-led gas project known as Arctic LNG II. Germany has been accused of "pure play hypocrisy" for complaining of the impacts of climate change brought by this week's catastrophic flooding while signalling support for a new gas project in the Arctic. Reuters has reported that France's Bpifrance, Germany’s Euler Hermes and Italy's SACE were among the state-backed international lenders considering providing about $9.5 billion in financial support for the project.

https://news.sky.com/story/european-floods-germany-accused-of-hypocrisy-over-arc...


Australian ECA gives 80X more to fossil fuel projects than renewables

(Guardian, Sydney, 6 July 2021) Australia’s export credit agency provided more than $1.5bn in finance to fossil fuel projects between 2009 and 2020, about 80X what it spent on renewables, according to a new report from Jubilee Australia. Over the same 11-year period, covering the hottest years on record globally, it provided $20m in support to renewables projects. Luke Fletcher, executive director of Jubilee Australia, argues that EFA’s support for fossil fuel projects “bucks the international trend”, risks investing in doomed projects and curtails opportunities for the country’s energy sector to modernise. Export Finance Australia has also been criticized for taking on a role as a Development Finance Institution (DFI), adding equity stakes in risky overseas infrastructure to its export insurance and lending powers in order to to compete with Chinese, Japanese and Korean ECAs. For some, this sort of reform blurs the distinction between the government and the private sector, and at worst is a form of corporate welfare, blurring the line between helping developing countries vs Australian business. Australia is the world’s largest exporter of coal and gas, yet producers in those sectors are finding it increasingly difficult to source financing from commercial lenders.

https://www.theguardian.com/environment/2021/jul/06/australias-export-credit-age...


EXIM support and the Pemex Ocean fire

(Climate Change News, Broadstairs, 14 July 2021) Campaigners have called on the US to review its longstanding support for Mexico’s state-owned oil and gas company after a gas leak from one of its pipelines set the ocean on fire in the Gulf of Mexico.  The US export credit agency Exim bank has provided $16.14 billion in loans and guarantees to Pemex since 1998, with recent funds going to the site of the fire. For 76 years, the company has received billions of dollars in support from the US export credit agency, the Export–Import Bank (Exim), despite warnings of safety and environmental concerns.

https://www.climatechangenews.com/2021/07/14/ocean-fire-raises-questions-us-supp...


Export Development Canada Promises Net Zero by 2050

(Globe Newswire, Ottawa, 22 July 2021) Export Development Canada (EDC) is committing to net zero emissions by 2050 across its business lines and in its own global operations. The Crown corporation’s plan will include interim reduction targets for the most carbon intensive sectors for 2023 and 2030, supported by sustainable finance objectives. Meanwhile, EDC may face court action in the not-too-distant future, after a legal opinion commissioned by Oil Change International and several other organizations concluded that national export credit agencies have an international legal obligation to scale back their financing for fossil fuel-related activities. Canadian mining and gas company ReconAfrica is currently exploring for oil and gas in Namibia and Botswana which could become one of the biggest oil finds of the last few decades.

https://www.globenewswire.com/news-release/2021/07/22/2267539/0/en/Export-Develo...


UKEF reports export credit arrangements for 2020

(Janes Defense, London, 23 June 2021) The UK's export credit agency, UK Export Financing (UKEF), revealed in its annual report on 22 June that it had underwritten a record GBP12.3 billion (USD17.1 billion) for UK industry during the 2020/21 financial year. Key transactions in the annual report included the beginning of the drawing of GBP1.13 billion to BAE Systems in support of the manufacture of Eurofighter Typhoon and BAE Systems Hawk trainer aircraft to Qatar. In addition, buyer credit guarantees for Indonesia were supplied for the acquisition of Lockheed Martin C-130J Hercules medium transport aircraft (maximum liability of GBP74.6 million) and air-defence systems from Thales UK (maximum liability of GBP29.8 million).

https://www.janes.com/defence-news/news-detail/uk-government-reports-export-cred...


Australian ECA eyes bid for Pacific telecoms to block China

(Nikkei, Sydney, 20 July 2021) The government of Australia looks to support a bid by domestic telecom Telstra to buy a leading South Pacific mobile phone business reportedly eyed by a Chinese suitor, as Canberra works to limit Beijing's influence in the region. Telstra said Monday it is discussing a purchase of the Pacific operations of Jamaica-based Digicel "in partnership with the Australian government." The Australian company said any such deal for Digicel Pacific "would be with financial and strategic risk management support from the government." The government [through Export Finance Australia] would pay for half of the purchase -- estimated by local media at 2 billion Australian dollars ($1.47 billion) -- with Telstra taking a minority stake if the transaction is completed, Reuters reports. If China acquires the Pacific mobile network, it could monitor Australia’s communications to and from the region and use asset management as leverage noted John Lee, a senior researcher at the University of Sydney.

https://asia.nikkei.com/Business/Telecommunication/Australian-alliance-eyes-bid-...


Ghanaian rail project takes off with Swedish & South African ECA backing

(TFX News, London, 7 JUly 2021) Most recently Ghana's Ministry of Finance (MoF) signed a landmark €600 million ($712 million) ECA-covered financing deal for the construction of a 100 km section of the country’s Western Railway Line running from Takoradi Port to Huni Valley. Deutsche Bank acted as mandated lead arranger for both loans. The first, backed by EKN and fully arranged by Deutsche Bank, is a €523 million loan covering the bulk of the cost. The second is a €75 million commercial loan arranged and structured by Investec to cover the downpayment on the EKN-backed financing. It is backed by South Africa’s ECIC and funded by a syndicate of Investec Bank, Rand Merchant Bank, Nedbank (London branch) and Sanlam life Insurance. The Western Railway line is key to the haulage of agricultural produce and minerals from the middle belt to Takoradi Port in the south of Ghana. [The corridor is home to key bauxite mines, which are the bedrock of the country’s integrated bauxite aluminium masterplan.] The involvement of EKN and SEK reflects the significant number of Swedish sub-suppliers participating in the project. The engineering, procurement, and construction (EPC) contractor for the project is Amandi Investment with Bluebird Finance & Projects acting as lead financial advisor for the EPC. Given South Africa’s expertise and established trade flows in rail projects, Investec and Bluebird Finance & Projects - alongside Amandi, discovered that a multitude of South African rail suppliers could be sourced for this project and in turn reached out to ECIC to support the commercial facility, a first for the South African ECA.

https://www.txfnews.com/News/Article/7213/Training-for-rail-travel-all-aboard


U.S. Chamber of Commerce supports EXIM

(US Chamber of Commerce, Washington, 1 July 2021) In a letter to the Committee on Appropriations of the U.S. House of Representatives, the Chamber noted that overseas markets represent 95% of the world’s consumers and 80% of its purchasing power. Exports already support half of all manufacturing jobs, and one in three acres of American farms is planted for hungry consumers overseas. Approximately 300,000 small- and medium-sized businesses export, accounting for one-third of all merchandise exports. The International Affairs budget and the agencies it supports play a vital enabling role for U.S. companies to tap foreign markets and create jobs and prosperity at home. The Ex-Im bank provides vital financing and guarantees to help American businesses export. In the last pre-pandemic fiscal year when the Bank was fully functional (FY 2014), Ex-Im backed export sales that supported more than 164,000 American jobs. That same year, 90% of Ex-Im’s transactions — more than 3,340 — directly supported American small businesses. Far from being a burden on the taxpayer or a subsidy for corporations, Ex-Im charges fees for its services that has generated $7 billion in revenue for the U.S. Treasury over the past two decades beyond funds it received in appropriations. Failure to support Ex-Im would amount to unilateral disarmament in the face of other nations’ aggressive trade finance programs.

https://www.uschamber.com/letters-congress/us-chamber-letter-fy22-state-and-fore...


U.S. EXIM Bank says 2020 financing volume still far below global rivals

(Reuters, Washington, 30 June 2021) The Export-Import Bank of the United States said on Wednesday it remained far behind its global competitors in financing volume in 2020 even as overall financing activity fell due to the COVID-19 pandemic. In its annual competition report here to Congress, EXIM said it authorized $1.8 billion in official medium- and long-term export credit support during calendar 2020, compared with global leader China at $18 billion, France at $12.1 billion, Germany at $8.6 billion and South Korea at $5 billion. China, traditionally the largest provider of export credit, saw its financing volume decrease last year from over $33 billion in 2019.

https://www.reuters.com/article/marketsNews/idUSL2N2OC3DH?il=0


SACE helps revive Italian steelmaker Acciaierie d'Italia

(SteelOrbis, Brescia, 1 July 2021) Invitalia, the public shareholder, by entering the board, is expected to implement contractual commitments, in all a little over €2 billion - €400 million of capital increase - have already been paid, while about €700 million are missing in guarantees for a SACE [Italian export credit agency] loan, plus €900 million in reimbursements and support for variously assorted investments,  Steel magnate ArcelorMittal has so far supported the company with a capital payment of €1.8 billion. Now it is up to the Italian State through Invitalia to do what was agreed, based on the contract that was signed in December 2020, stated Acceaierie CEO Lucia Morselli. She added "The market is favorable and the company is working hard. However, until August 2023 we must comply with environmental constraints that prevent us from accelerating production even more." 

https://www.steelorbis.com/steel-news/latest-news/italys-acciaierie-ditalia-retu...


Insurers mourn missed chance to form EU ECA

(Global Capital, London, 30 June 2021) Europe missed an opportunity to use the debate over the future of development finance to establish an insurance guarantee agency to attract private capital needed to help them hit targets for investment into emerging markets, according to experts in trade finance and insurance. Policymakers spent two years debating whether to use the EBRD or the European Investment Bank as a platform for a new single development bank before deciding to stick with the current set-up augmented by a more collaborative approach dubbed “Team Europe”. An EU development insurer could also use reinsurance to mobilise substantial amounts of non-development finance institutional capital from the private insurance market and from EU export credit agencies, Paul Mudde, former trade finance professional at ABN Amro and trade credit insurer Atradius, said. The problem, in his view, was that in the EU discussions about the European Financial Architecture for Development (EFAD) an insurance approach, like the World bank’s MIGA, had never been considered.

https://www.globalcapital.com/article/b1shr452dndz04/insurers-mourn-missed-chanc...


Afreximbank plans $8 billion fund to offset trade-pact losses

(Bloomberg, London, 15 July 2021) African nations plan to raise about $8 billion for a fund to help offset revenue losses for countries that lower cross-border tariffs, as part of a continent-wide free-trade agreement. The African Export-Import Bank, or Afreximbank, has already provided $1 billion for the fund after the African Union set it up to help cushion sudden revenue losses and encourage participation. The free-trade area went into effect on Jan. 1. The $1 billion made available by Afreximbank will be used to leverage funding from other multilateral development-finance institutions, export credit agencies, commercial banks and donors. Afreximbank, in collaboration with the African Union, will hold intra-Africa trade fair in South Africa in November to provide access to trade and market information to companies and countries. In addition, it’s planning “face-to-face training workshops’’ in 13 countries from October to build the capacity required to meet trade targets, the lender said.

https://www.bloomberg.com/news/articles/2021-07-15/africa-plans-8-billion-fund-t...


New Norwegian ECA, Eksfin, begins operations

(ShipInsight, Oslo, 2 July 2021) Oslo-headquartered Export Finance Norway (Eksfin.no), the result of a merger between former government agencies GIEK and Export Credit Norway, has opened its doors and is fully operational from 1 July 2021. The merger of the two predecessor agencies forms part of a larger redesign by the Ministry of Trade, Industry and Fisheries of the government apparatus around export promotion and export credit financing to make the system easier to navigate for end users.

https://shipinsight.com/articles/new-norwegian-export-credit-agency-eksfin-begin...


What's New June 2021

I apologize for the delay in publishing this month. This issue is being sent from the beach at Sandbank Park. 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.

  • Global capital racing towards clean energy
  • Rich Countries Subsidizing “Dash for Gas” in Developing World
  • As banks [and ECAs?] flee coal, campaigners turn sights on gas
  • Human Rights Watch Q&A on ECA Fossil Fuel Subsidies
  • World's largest oil shale power plant in Jordan near completion with Sinosure support
  • Chinese export insurance company reports steady business growth
  • ECA supported Ethiopian projects show ‘railpolitik’ in action
  • EXIM Environmental and Social Projects Information and Concerns Grievance Hotline
  • Is West Africa the focus region for ECA-supported financing?
  • Nigeria looks for US$85 billion in investments, increasing ECA dependencies
  • UK business given £12.3bn export support from government
  • Rosatom Preparing Support With French ECA For Foreign Nuclear Power Plants
  • KDF to acquire 118 APCs from Turkey at US$7.4 million
  • ECA Climate change goals lacking on maritime shipping decarbonization

Global capital racing towards clean energy

(Hindu Business Line, Chennai, 17 June 2021) India must accelerate its shift to renewable energy to attract more ESG funding and, thereby, meet its net zero emissions target. The International Energy Agency’s net zero emissions (NZE) roadmap by 2050 sets out the massive investment required to cut emissions and achieve the Paris goal of restricting global surface temperature increase to below 1.5 degree Celsius. Under the NZE roadmap, the use of unabated fossil fuels declines sharply to just over a fifth of the total energy supply. More than two-thirds of the energy supply in 2050 will come from renewables and around a tenth from nuclear. To meet these targets, total annual energy investment will have to surge to $5 trillion by 2030, more than tripling from just over $500 billion annually over the last five years to more than $1,600 billion in 2030. Further, the NZE roadmap requires annual investment in transmission and distribution grids to expand from $260 billion in 2021 to $820 billion in 2030. Global capital is already fleeing fossil fuels and moving towards more profitable clean energy — a shift that is now accelerating in response to net zero pledges last year by China, Japan and South Korea, a ratcheting up of climate ambition by President Biden’s administration and the recent announcement by G7 countries that they will exit all international coal financing by their export credit agencies.

https://www.thehindubusinessline.com/opinion/global-capital-racing-towards-clean...


Rich Countries Subsidizing “Dash for Gas” in Developing World

(Energy Fuse, Washington, 7 June 2021) Rich countries are using public financing to expand the construction of natural gas infrastructure in poorer countries around the world. Public-financing of gas in the Global South exceeds that of renewable energy by a factor of four, according to a new report from the International Institute for Sustainable Development. The continued government-backed financing of fossil fuels in low- and middle-income countries puts climate goals at risk and threatens to lock in infrastructure for decades to come. The investment “risks driving a new dash for gas locks countries into a high-carbon pathway, imperiling their economies future and the global climate,” the authors warned in the report. Funding for gas comes from an array of multilateral development banks and a constellation of bilateral financing at the government level from G20 nations, such as export credit agencies and development banks. According to the study and to data from Oil Change International, natural gas projects in the Global South received an average of $16 billion in international public financing between 2017 and 2019, four times higher than solar and wind. Of that total, 48% came from just three countries: Japan, China and the United States. Most of that financing (46%) is funneled into power generation, a sector where there are cheap alternatives in solar, wind and energy storage.

http://energyfuse.org/rich-countries-subsidizing-dash-for-gas-in-developing-worl...


As banks [and ECAs?] flee coal, campaigners turn sights on gas

(Global Trade Review, London, 16 June 2021) Environmental campaign groups are switching their aim to public and private financing for natural gas projects as they get closer to winning the battle over thermal coal. But the only firm commitments on financing have been on thermal coal, where the G7 nations – Canada, France, Germany, Italy, Japan, the UK and the US – committed to “take concrete steps towards an absolute end to new direct government support for unabated international thermal coal power generation by the end of 2021” including export finance and trade support. But data from Oil Change International, a non-profit that campaigns against the use of fossil fuels, suggests the move will make little impact on overall public financing for fossil fuels. In recent months, UK Export Finance (UKEF) has been working to roll out a new transition development guarantee scheme to help oil and gas companies switch towards less polluting operations. But while industry bodies have backed the export credit agency’s plans, analysts (and campaign groups) have warned new initiatives must avoid funding any and all fossil fuels... There has not yet been much market uptake of instruments issued using for example the LMA’s Social Loan Principles.

https://www.gtreview.com/news/global/95275/


Human Rights Watch Q&A on ECA Fossil Fuel Subsidies

(Human Rights Watch, New York, 7 June 2021) Government financial support for fossil fuels, including through subsidies, presents a key obstacle to achieving emissions reductions urgently needed to address the climate crisis. Subsidies artificially reduce the costs of fossil fuel production and use, driving continued fossil fuel dependence at a time when governments should be rapidly transitioning away from fossil fuels toward clean, renewable energies like wind and solar. Human Rights Watch has documented how climate change in Canada is depleting Indigenous peoples’ access to traditional food sources and in Colombia, showed how more frequent droughts are worsening malnutrition among Indigenous children. In the US, extreme heat is linked to adverse birth outcomes. These are only a few of the growing impacts experienced around the world that are expected to intensify as temperatures continue to rise in coming years. As of 2019, G20 governments, representing the world’s major economies, supported coal, oil, and gas production and consumption by, on average, $548 billion per year. A significant disparity in support also exists in international public finance, such as from export credit agencies. G20 countries provided at least $77 billion a year through their international public finance institutions.

https://www.hrw.org/news/2021/06/07/qa-fossil-fuel-subsidies


World's largest oil shale power plant in Jordan near completion with Sinosure support

(Zawya, Dubai, 1 June 2021) The Attarat project will generate 3.7bln kWh of electricity, which can meet nearly one-fifth of Jordan's power demand. The first unit of the world's largest oil shale power plant, located at Attarat um Ghudran, Jordan, is now online, the project's Chinese contractor tweeted last week. The post also said the project is the largest 100% Chinese financed private infrastructure project outside China under the Belt and Road Initiative (BRI). In March 2017, Reuters had reported that the project had secured debt financing from a consortium of Chinese banks. In the same month, JV partner Enefit said in a statement that the project is the first oil shale-fired power plant and mine in the world financed using limited recourse debt financing, securing $1.6 billion for 15 years, backed by export credit insurance from Sinosure.

https://www.zawya.com/mena/en/business/story/Worlds_largest_oil_shale_power_plan...


Chinese export insurance company reports steady business growth

BEIJING, June 5 (Xinhua, Beijing, 5 June 2021) China's only policy-oriented insurer specializing in export credit insurance reported steady business growth in the first five months of 2021. The China Export & Credit Insurance Corporation, or SINOSURE, served about 139,000 clients in the January-May period, increasing 16.3 percent year on year. During the period, the company underwrote about 314.63 billion U.S. dollars worth of insured businesses, up 28 percent year on year. SINOSURE is a state-funded and policy-oriented insurance company that promotes China's foreign economic and trade development and cooperation. It was officially launched and put into operation in 2001, and its service network now covers the whole country.

https://www.bignewsnetwork.com/news/269771725/chinese-export-insurance-company-r...


ECA supported Ethiopian projects show ‘railpolitik’ in action

(Financial Times, London, 31 May 2021) Two ECA lines of credit offer a comparison of Chinese and non-Chinese ECA infrastructure loans in the same African country. A decade ago, when Ethiopia’s late leader Meles Zenawi was planning 5,000km of standard gauge railway, the landlocked country was granted a $2.5bn loan by China Eximbank. That loan was tied to the construction of an 800km railway east-west between Addis Ababa, the capital, and the port city of neighbouring Djibouti. It would be built by Chinese engineers and use Chinese locomotives. A second rail 2013 project intended to run about the same distance south to north, between the central town of Awash and Mekelle, capital of the now war-torn Tigray region was undertaken by a Turkish construction group which helped broker $1.1bn of funding from Turkey’s Eximbank, Credit Suisse and European export credit agencies. Financing proved a big difference. When Ethiopia ran into problems servicing its debt due to a perennial shortage of foreign currency, the Chinese proved flexible, where in contrast, there were penalties built into the European loans for delayed repayment.

https://www.ft.com/content/cc1dc93d-d3d0-4728-8521-14734199c58d


EXIM Environmental and Social Projects Information and Concerns Grievance Hotline

(EXIM, Washington, 29 June 2021) The Environmental and Social Project Information and Concerns unit of EXIM provides a process for customers, organizations, and individuals to request or submit information, or express concerns, regarding specific EXIM supported projects, and provides feedback on environmental and social issues. It establishes a formal timeline for response, allowing EXIM staff to promptly receive inquiries and engage in appropriate follow-up action. Contact them at +1 800 565.3946 or +1 202.565.3570 or by email at <EnviroResponseCoord@exim.gov> or via an online form at the above link. An interesting and potentially useful ECA accountability mechanism, depending on how it is being implemented.

https://www.exim.gov/policies/ex-im-bank-and-the-environment/environmental-and-s...


Is West Africa the focus region for ECA-supported financing?

(Business Alive, Johanessburg, 14 June 2021) Export credit agency (ECA) finance is an important lever for infrastructural development in West Africa. According to deal intelligence platform TXF Data, Africa was the second-most active region globally in 2020 for ECA-supported financing, with more than $35.5bn worth of ECA-supported debt. This included some of the largest single financed projects in Africa, such as the Mozambique LNG transaction ($14.9bn); the Nigeria LNG train 7 ($3bn); and the Credendo/The Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC) covered $359m real estate project in Abidjan, to name a few. The Covid-19 pandemic aggravated the infrastructure deficit faced by the continent. West African governments responded quickly, finding new strategies to raise the deficit themselves — particularly with social infrastructure. Unlike East and Southern Africa, West Africa raised finance on the sovereign’s balance sheet, via the ministry of finance (MoF). ECA direct financing is an integral part of financing in West Africa. This model of financing provided by most European ECAs is generally a “countercyclical” financing mechanism that seeks to address market failure. In the first quarter of 2020, there was a global shortage of liquidity, and this significantly raised the cost of financing. This caused ECAs to step up and provide direct loans to MoFs at low Organisation for Economic Cooperation and Development (OECD) commercial interest rates of reference (CIRR). Governments are aware of these financing arrangements and made use of the product offered by ECAs in 2020 (for example the latest March 2021 OECD CIRR for 8.5+ year loan in US dollars is 1.91%).

https://www.businesslive.co.za/bd/companies/financial-services/2021-06-14-native...


Nigeria looks for US$85 billion in investments, increasing ECA dependencies

(This Day, Lagos, 30 May 2021) As the African Continental Free Trade Area enters its first six months of inauguration on Tuesday, 1st June, the need for Nigeria to enter the fray of her infrastructure development was the topic that dominated discourse at various fora last week. While the webinar sponsored by Nigeria Export Import Bank revolved around preparing Nigeria in the area of infrastructure development for international trade, the webinar organised by the Bureau of Public Enterprises, similarly dwelt on infrastructure issues and how government will engage it using the public private partnership model. To complement the PPP platform, the apex bank tasked the state governments to tap into the opportunities available to develop the economies of their respective states.

https://www.thisdaylive.com/index.php/2021/05/30/afcfta-and-nigerias-n35tn-infra...


UK business given £12.3bn export support from government

(City AM, London, 23 June 2021) In its annual results published today UK Export Finance (UKEF) announced that it provided £12.3bn (US$17bn) of support to UK exporters in the last financial year, amid coronavirus disruption and ongoing Brexit trade negotiations, almost 3X the amount given in 2019-20. UKEF estimates that its financial support to UK exporters during the pandemic has safeguarded up to 107,000 jobs, and helped key industries in the UK to survive. £7.3bn (59%) was dedicated to exporters including Ford, Nissan, Subsea 7, Rolls Royce, easyJet, and British Airways, whose businesses were severely disrupted by the pandemic, the agency said. A large chunk of this support went to major exporters British Airways and easyJet, who received £2.5bn (20%) to help safeguard jobs at Luton and Heathrow airports. Small businesses in London benefitted from £215m (1.7%) as part of the agency’s Temporary Covid Risk Framework. 79% of the 549 companies UKEF supported were SMEs, [although the % of total funds for SMEs is not known]. The announcement comes a year after campaigners launched a probe into UKEF that found it was supporting sectors prone to corruption as part of its post-Brexit export drive. Campaign group Spotlight on Corruption expressed particular concern at the time that UKEF was increasingly supporting newly established UK-registered subsidiaries of foreign construction firms that have been embroiled in corruption allegations.

https://www.cityam.com/uk-business-given-12-3bn-export-support-from-government/


Rosatom Preparing Support With French ECA For Foreign Nuclear Power Plants

(UrduPoint News, Moscow, 31st May, 2021) Atomenergoprom JSC, a subsidiary of Russian state corporation Rosatom, consolidating all civil assets of the Russian nuclear industry, is working with the French Economy Ministry on a new mechanism for financial support of its nuclear power plant construction projects abroad with the participation of French export credit agency Bpifrance Assurance Export, according to Atomenergoprom's 2020 annual report. Work continued with the French Ministry of Economy and Finance on the development of a fundamentally 'new mechanism' for financing the company's projects for the construction of nuclear power plants abroad, and will continue in 2021" the report says. No further details are provided. In another nuclear power story involving ECAs, Ukrainian nuclear power plant operator Energoatom told ambassadors of the Group of Seven (G7) and the head of the EU mission in Ukraine that it has "made significant progress" with its strategy to diversify its sources of nuclear fuel. Since 2010, they have signed three contracts for the supply of nuclear materials for the production of nuclear fuel by Urenco, which is one of Westinghouse's nuclear fuel suppliers. Their current contract was signed in July 2019. They are now considering increasing the volume of supplies of nuclear materials under that contract and attracting funding under the UK government's export support programme, which is being implemented through UK Export Finance, the UK's export credit agency.

https://www.urdupoint.com/en/world/rosatom-preparing-with-france-mechanism-for-f...


KDF to acquire 118 APCs from Turkey at US$7.4 million

NAIROBI, Kenya, Jun 5- The Kenya Defence Forces (KDF) is set to acquire 118 Armoured Personnel Vehicles (APCs) from Turkey, in a move meant to bolster its resilience power in the war against terrorism. Kenya is expected to spend Kenyan Sh7.7 billion to purchase the 118 APCs through the Turkish Export Credit Agency. The APCs will be acquired from the Turkish defense and automotive firm Katmerciler. Two other firms, one from South Africa and North America, were locked out of the multi-billion shillings deal.

https://www.capitalfm.co.ke/news/2021/06/kdf-to-acquire-118-apcs-from-turkey-at-...


ECA Climate change goals lacking on maritime shipping decarbonization

(S&P Globlal, New Yrk, 3 June 2021) The difficult-to-decarbonize maritime shipping sector was not part of the Paris agreement, and is projected to account for an increasing portion of global CO2 emissions. The international cargo and container shipping industry plays a central role in global supply chains, but until recently has made few inroads toward decarbonization. That needs to change if the world is going to achieve net zero emissions by 2050. An inaugural report released late last year showed that ECA shipping portfolios aligned with the climate goals set by the IMO at only three of 15 disclosing institutions: Dutch bank ING Groep NV, French export credit agency Bpifrance Assurance Export, and Eksportkreditt Norge AS, also known as Export Credit Norway. But even as it pursues deep decarbonization pathways, the maritime shipping industry is taking up interim solutions. For starters, some shippers have begun using liquified natural gas as a shipping fuel, which produces significantly less carbon than the oil the industry uses. But since natural gas is not viewed as a permanent solution because it still emits carbon, the industry is pursuing zero-carbon options as well. The Getting to Zero Coalition coordinated by the Global Maritime Forum. The coalition recently released a report that found getting past the tipping point for zero-emissions fuel costs will require the industry to have 5% adoption of those fuels by 2030, with adoption ramping up to more than 90% by the mid-2040s.

https://www.spglobal.com/esg/insights/your-climate-change-goals-may-have-a-marit...


What's New May 2021

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.

  • ECAs and Fossil Fuels
  • OECD Study Measures Distortions in International Markets, but not by ECAs
  • IEA leaves little room for doubt: no fossil fuel expansion - but ignores ECAs
  • EDC singled out on fossil fuel finance by international legal opinion
  • EU lawmakers urge French, German & Italian ECASs to ditch Arctic LNG 2 support
  • Decarbonising Danish Export Credits
  • Egypt to buy Rafale fighter jets with French ECA support
  • Russian Export Credit Line for Sri Lankan Arms
  • Japan looks to introduce finance system for defence exports
  • Belarus isolation deepens as air links cut and Swedish ECA credit cancelled
  • Europe’s big oil companies exploit African natural-gas loophole
  • Royal Caribbean adjusts $1.15 B in ECA facilities facing $1.1 B loss in first quarter of 2021

ECAs and Fossil Fuels

(ECA Watch, Ottawa, 29 May 2021) TXF News recently pronounced Mozambique's LNG Area 1 project as the winner of its energy financing ECA-backed deal of the year, highlighting the "battle" between coal and gas (and oil) in the industry's efforts to survive efforts to halt climate change, following the International Energy Agency's (IEA) recent warning that we must reduce CO2 emmissions to net-zero by 2050. The IEA report on May 18 noted that "nations around the world would need to immediately stop approving new coal-fired power plants and new oil and gas fields and quickly phase out gasoline-powered vehicles if they want to avert the most catastrophic effects of climate change." A recent Oil Change International legal opinion has also warned about the legal consequences of continuing to back fossil fuel projects elsewhere in the world. The fossil fuel industry and some governments had begun to make noises about ceasing funding for coal, claiming that LNG is "safer", hence TXF's apparent "praise" for the US$29 billion ECA backed Mozambique LNG project. However, a 2018 Rentar Environmental Solutions study notes that natural gas contributes more to global warming than coal, gasoline and diesel, far more in fact. UKEF funding of Mozambique's LNG plans are now the subject of a UK court review as well as the subject of an EXIM scandal over its loan guarantee for a Greensill Capital investment in a Texas gas terminal, approved to dampen US fossil fuel industry opposition to EXIM's support for their competitor Anadarko Petroleum's 26.5% share in the huge Mozambique LNG project. To round off the controversies, Total's Mozambique operations, the recipient of multiple ECA financial supports, have had to be cancelled as the result of a jihadist assault on a nearby town.




OECD Study Measures Distortions in International Markets, but not by ECAs

(OECD, Paris, May 2021) This OECD report looks at support governments provide to their industrial producers which they say has been a growing source of trade tensions amid reports of excess capacity and unfair competition. While much light has already been shed on support to agricultural producers and fisheries, the scope and scale of government support in manufacturing remains opaque and poorly documented. The study finds that firms benefit by not being subject to the same market discipline as their competitors, domestic or foreign. However, they note that much of the little academic evidence that exists for OECD countries concerns either the effects of subsidised lending on small and medium-sized enterprises (e.g. from a regional development angle) or export credits. They note that both issues fall outside the scope of the present report. The claim "export credits are in principle subject to the OECD Arrangement on Officially Supported Export Credits and should therefore reflect market terms and conditions for Participants." A review of the keywords "eca subsidies" on the ECA Watch web site found 97 example documenting the fact that export credits do not reflect "market terms and conditions for Participants", contrary to the claims of the OECD "gentlemans" agreement.

https://www.oecd-ilibrary.org/docserver/a1a5aa8a-en.pdf


IEA leaves little room for doubt: no fossil fuel expansion - but ignores ECAs

(Bank Watch, Nijmegan, 18 May 2021) The International Energy Agency (IEA) has launched a long-awaited report setting out for the first time an energy scenario that is aligned with the urgent goal of limiting global warming to 1.5°C. The Agency sets this out in its report, “Net Zero by 2050: A roadmap for the global energy sector”, which it claims is “one of the most important and challenging undertakings in the IEA’s history”. Although not without problems, its headline conclusion is rock-solid: there can be no new fossil fuels in a net-zero by 2050 pathway. This conclusion is fully aligned with one of the core demands of the global call on banks on the new Fossil Banks No Thanks platform, launched yesterday. Unfortunatly the report makes no reference to the role of ECAs which are amongst the largest financial supporters of new fossil fuel projects.

https://mailchi.mp/banktrack/the-iea-leaves-little-room-for-doubt-no-fossil-fuel...


EDC singled out on fossil fuel finance by international legal opinion

(National Observer, Vancouver, 5 May 2021) EDC's financial support to the oil and gas sector came under scrutiny Tuesday as part of a new legal opinion outlining Canada’s obligations in responding to the climate crisis. The legal opinion from London says governments must take steps to stop their export credit agencies from providing financial help to oil and gas projects worldwide. EDC provided over $8 billion in support last year to the oil and gas sector, it has confirmed, and over $10 billion the year before. EDC says it operates at arm's length from the government, that it has cut down on its lending portfolio’s exposure to high-carbon sectors in recent years, and complies with all the OECD climate-related policies. Viñuales and Cook’s legal opinion explicitly singles out EDC as representing the largest supporter among G20 export credit agencies of fossil fuels during the 2016-18 period. EDC’s climate change policy — and some criticism levied against it related to oil and gas — is also highlighted.

https://www.nationalobserver.com/2021/05/05/news/legal-opinion-singles-out-canad...


EU lawmakers urge French, German & Italian ECASs to ditch Arctic LNG 2 support

(Reuters, London, 18 May 2021) A group of mostly Green Party lawmakers from the European Parliament on Wednesday urged the leaders of Germany, France and Italy not to support a Russian Arctic liquefied natural gas (LNG) project due to climate change concerns. The $21 billion project, led by Russian gas producer Novatek and with international backers including French oil major Total TOTF.PA, is expected to launch in 2023 and reach full LNG production capacity of almost 20 million tonnes a year in 2026. "We urge the French, German and Italian governments to refuse to support this project and set a new standard by ending all export finance support to fossil fuels before COP26," the letter said.

https://www.nasdaq.com/articles/eu-lawmakers-urge-france-germany-italy-to-ditch-...


Decarbonising Danish Export Credits

(Just Finance International, Aarhus, 25 May 2021) A forthcoming report from Just Finance International outlines recommendations to the Danish government for plans to phase out fossil fuel support for its export credit agency (ECA) Eksport Kredit Fonden (EKF) and also for its broader international public finance support. Public development funds are meant to benefit people, climate and environment, but in reality they support some of the most destructive activities on earth. Coal power is the world’s most polluting energy source, and the largest contributor to climate change. Yet public funds are still financing new investments in coal and other highly polluting industries. In response to worsening climate change, the United Nations International Panel on Climate Change (IPCC) has announced that financial and governmental support of high-emission sectors must be decreased, and climate resilience increased. The UN IPCC has made clear that all untouched fossils must stay in the ground and all subsidies must stop if the Paris climate goals are to be  reached. In line with the Paris Agreement goals, governments and their institutions worldwide are taking steps to phase out fossil fuels. In this report, a screening of Danish ECA EKF’s portfolio shows that while its investments in fossil fuels are limited, it has several projects in high-greenhouse gas emission (GHG) sectors such as cement, hydropower and mining, and in the livestock and chemical sectors. It is also likely to increase its involvement in cement and hydropower in the coming years. Because export credit agencies are demand-driven, their portfolios reflect the applications they receive. Clear regulations are essential to prevent ECA support for fossil fuels and other high-emission sectors in the future.

https://justfinanceinternational.org/


Egypt to buy Rafale fighter jets with French ECA support

(Second Line of Defense, Virginia, 5 May 2021) France welcomed May 4 an Egyptian announcement of an order for a further 30 Rafale fighter jets and weapons from Dassault Aviation, MBDA and Safran, confirming a news report on Disclose, a French campaigning website. The Egyptian deal was worth a total €3.95 billion ($4.7 billion), with €3.75 billion for the Rafales, and €200 million for weapons from MBDA and Safran Electronics & Defense. Because Egypt is heavily indebted, the acquisition will be financed by an export credit guaranteed bank loan backed by France for up to 85 percent of the total amount.

https://sldinfo.com/2021/05/egypt-to-buy-more-rafale-fighter-jets/


Russian Export Credit Line for Sri Lankan Arms

(Daily News, Colombo, 13 May 2021) The Sri Lanka Air Force (SLAF) in its response to concerns raised by the Opposition on the Government’s move to purchase new helicopters from Russia amidst the COVID pandemic, said the purchase was on a Government-to-Government basis via a Line of Credit offered to Sri Lanka to purchase military hardware from Russia which is still being negotiated over several years. Russia had offered Sri Lanka a US$ 300 million Credit Line, from which 14 Mi-171E and Mi-171Sh helicopters were bought down in 2010 at a cost of US$ 165 million, some of which are currently being used for UN peace keeping operations. He said that there was a balance of US$ 135 million which lapsed in 2015, but it was renewed by Russia to allow Sri Lanka to purchase a Gepard 5.1 Offshore Patrol Vessel (OPV) for the Sri Lanka Navy. However, since the Navy had found a less costly alternative, Russia had agreed to allow that amount to purchase Mi-17 helicopters.

http://www.dailynews.lk/2021/05/13/features/249153/russian-credit-line-%E2%80%93...


Japan looks to introduce finance system for defence exports

(Janes Defence News, Coulsdon, 18 May 2021) The government of Japan is reportedly looking into the possibility of supporting defence exports through the provision of low-interest loans. The plan would involve the state-owned Japan Bank for International Cooperation (JBIC) providing credit to potential customers. Government sources cited by Japanese media said the loans would enable developing countries with a shortfall in funding to procure defence equipment from Japan. The government’s official export credit agency, Nippon Export and Investment Insurance (NEXI), would support the loans.

https://www.janes.com/defence-news/news-detail/japan-looks-to-introduce-finance-...


Belarus isolation deepens as air links cut and Swedish ECA credit cancelled

(The Journal, Dublin, 18 May 2021) Belarus was increasingly isolated today as Europe cut air links and calls grew for more action over its diversion of an airliner and arrest of a dissident on board. The Swedish Export Credit Agency (EKN) said today it was withdrawing export guarantee offers for deals involving two state-owned Belarusian companies, citing failure to live up to human rights standards. The guarantee offers, which totalled two billion Swedish kronor (€197 million), concerned the sale of gas turbines from a Swedish subsidiary of Germany’s Siemens and state-owned Belarusian energy companies RUE Minskenergo and RUE Brestenergo.

https://www.thejournal.ie/joe-biden-belarus-plane-arrest-5447194-May2021/


Europe’s big oil companies exploit African natural-gas loophole

(Africa Report, Paris, 24 May 2021) Facing pressure from the public and Western regulators, as well as from shareholders and financial partners, oil industry majors, especially those based in Europe – chiefly Shell, BP, Total and Eni – have initiated an unprecedented transformation by voluntarily reducing their crude oil activities in favour of [so called] “greener” forms of energy. This may be good news for environmental activists, but not so for Africa’s oil-producing countries that benefit from the tax revenues and jobs the industry brings. In the global race to reduce carbon emissions, Africa is a bystander rather than an active participant. The continent produces 9% of the world’s liquefied petroleum gas (oil) – or 7.2m barrels a day – and 6% of its natural gas, while being a low emitter of greenhouse gases. Home to 17% of the world’s population, Africa accounts for just 2% of global carbon emissions. In addition, more than half of its oil production is for export. Shell’s stated goal, backed by the European Union and the UK, is to become carbon neutral by 2050. Europe’s oil majors, while not required to meet any legal obligations at this stage, have integrated this target across their operations. It takes into account the end use of the fuels they sell (scope 3 emissions), which is by far the largest factor in carbon emissions. For example, the French group Total’s direct emissions amount to around 45m metric tonnes of carbon dioxide equivalent, but its vehicle-related emissions are estimated to be as high as 450m metric tonnes.

https://www.theafricareport.com/91319/africas-energy-transition-dilemma/


Royal Caribbean adjusts $1.15 B in ECA facilities facing $1.1 B loss in first quarter of 2021

(Royal Caribbean Blog, Winter Garden, 29 April 2021) While Royal Caribbean did lose $1.1 billion or $4.66 per share compared to US GAAP Net Loss, that is an improvement over the same time last year, when it lost $1.4 billion. Among the actions taken during the first quarter of 2021 to help include completing the balance of the previously announced amendments to its export credit facilities, which in total defer $1.15 billion of principal amortization due before April 2022 and waive financial covenants through at least the end of the third quarter of 2022.

https://www.royalcaribbeanblog.com/2021/04/29/royal-caribbean-reports-11-billion...


What's New April 2021

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.

  • CSOs say newly launched export finance coalition (E3F) fails to lead
  • OECD Arrangement amends local content rules for export credits
  • Rich nations under fire for funding gas as 'bridge fuel' overseas
  • UK court to review Mozambique fossil fuel investment
  • Biden Administration to Utilize EXIM as Key Element in New International Climate Finance Plan
  • Canada’s oil and gas sector received $13 billion in EDC subsidies during the pandemic
  • Beijing and New Delhi court Indian Ocean armies with ECA loans
  • Tell EXIM: Cut ties with India's deadly Sasan coal plant
  • US climate summit declarations deal major blow to coal in Asia
  • China Is Investing in Africa’s Energy and Transportation Infrastructure
  • Boeing Forecasts Sufficient Capital for Aviation Finance
  • Iraqi, GE achieve financial close of Power Up Plan 4
  • Russian president signs law to ratify protocol restructuring Belarusian ECA loan

CSOs say newly launched export finance coalition (E3F) fails to lead

(Oil Change International, Washington, 15 April 2011) In response to the launch of a new Export Finance for the Future coalition (E3F), 21 civil society organizations (CSOs) from 14 countries released a statement criticizing the lack of ambition from the coalition. The seven European countries, which according to French Finance Minister, Bruno Le Maire represent around 40% of export financing in the OECD, pledged to end formal trade and export financing directed at thermal coal mines and coal supply chain infrastructure. While welcoming the initiative as a step in the right direction, the CSOs, including Oil Change International, state that the coalition fails to take the urgent action that is required to meet climate goals: “Rather than adding new commitments, the E3F principles are simply a reiteration of what most signatories are already doing: not supporting the coal sector, increasing support for ‘green products’, and being more transparent about their support for oil and gas. For this coalition to make a real difference, it needs to take decisive action to end all export finance for fossil fuels, following at least the level of ambition shown by the UK, which put an end to virtually all new export finance for fossil fuels last month.” Seven European countries (Denmark, France, Germany, the Netherlands, Spain, Sweden and the United Kingdom) formally pledged to end their support for agencies that finance export projects Fossil fuels. CSOs note that a few countries are embarrassingly absent from the coalition, including the US and Canada. In January, the White House published an Executive Order stating that it would “promote ending international financing of carbon-intensive fossil fuel-based energy,” including finance provided by US EXIM. And while Canada’s export finance institution, Export Development Canada (EDC), was among the first ECAs to adopt a climate change policy, it remains a top provider of export support for fossil fuels.

http://priceofoil.org/2021/04/15/csos-say-newly-launched-export-finance-leadersh...


OECD Arrangement amends local content rules for export credits

(Global Trade Review, London, 27 April 2021) The decision to amend local content rules within the OECD Arrangement on Officially Supported Export Credits has been hailed as an “important step” in modernising the agreement, though industry figures have raised concerns over a lack of progress in other key areas of discussions. The OECD revealed last week that participating members of the Arrangement – which includes countries in the EU, as well as the US, Japan, Canada and Australia – had agreed to increase the maximum local cost support on offer from their ECAs. For export contracts in high income OECD countries (category one), maximum local cost provisions have risen from 30% of the export contract value to 40%. In all other nations (category two), the percentage of local costs a participating arrangement ECA can cover has been increased to 50%. A high-ranking official in the export credit sector familiar with discussions on the Arrangement, tells GTR that participating members had initially struck an agreement to amend local content rules in November. However, they say that the EU needed time to formally approve the changes as the Arrangement is legally binding in the bloc.

https://www.gtreview.com/news/global/oecd-arrangement-amends-local-content-rules...


Rich nations under fire for funding gas as 'bridge fuel' overseas

(Thomson Reuters, London, 21 April 2021) Donor governments are pulling out of financing new coal plants, but campaigners say they want pledges to cover all fossil fuels, with gas still touted by some as a way to transition to renewable energy. Pressure on wealthy governments to stop financing polluting coal projects in developing nations is getting results, with more countries announcing they will no longer make such investments. But the battle is far from won - and is now shifting to include oil and gas finance, climate change campaigners say. Last week, 57 U.S. green groups wrote to U.S. climate envoy John Kerry urging him to "unequivocally declare that gas is not part of the solution" and to immediately end all fossil fuel support internationally as well as U.S. exports of fossil fuels "as science and justice require". The move came after Kerry told a discussion with the head of the International Monetary Fund this month that "gas, to some degree, will be a bridge fuel", meaning it could smooth the transition from the dirtiest energy sources - coal and oil - to renewables. Kate DeAngelis of Friends of the Earth noted the new plan to phase out fossil fuel finance did not cover the U.S. Export-Import Bank, the largest source of U.S. government financing for fossil fuel projects abroad. Some 20 environmental organisations said the E3F coalition had made no new commitments and that the Netherlands, France and Britain continued to provide support for gas extraction in violence-hit northern Mozambique, saying the investments had forced communities from their homes after losing their fishing areas and farmland.

https://news.trust.org/item/20210421220210-sdpc4/?utm_campaign=inDepth&utm_mediu...


UK court to review Mozambique fossil fuel investment

(Africa Times, Roubaix, 22 April 2021) The British government’s investment in developing liquified natural gas (LNG) projects in Mozambique – projects contributing to the conflict and instability in the country’s north – is headed for judicial review following a successful legal filing from the Friends of the Earth. The London-based NGO says the decision to approve funding for LNG was illegal, and wants it reexamined because investment in fossil fuels is inconsistent with both the global climate goals established under the Paris Agreement and the UK’s own climate commitments. The Guardian notes fears that fossil fuel project is stoking an insurgency in the north which has left thousands of people dead and displaced hundreds of thousands. The investment amounts to about US$1 billion through the UK Export Finance (UKEF), the British export credit agency. “We’re delighted the High Court has given us permission to challenge the UK government’s reckless decision to provide huge financial support to a climate-wrecking gas project in Mozambique,” said Will Rundle, head of legal at Friends of the Earth, in a statement released Thursday. French energy giant Total on Monday confirmed it is suspending work on a massive $20 billion gas project in northern Mozambique following the latest jihadist assault on a nearby town last month.  The US is also backing the $20 billion methane gas development. The US Export-Import Bank (Exim) has provided a $4.7bn loan to the project.

https://africatimes.com/2021/04/22/uk-court-to-review-mozambique-fossil-fuel-inv...


Biden Administration to Utilize EXIM as Key Element in New International Climate Finance Plan

(JD Supra, Sausalito, 27 April 2021) On April 22, 2021, President Joe Biden announced his International Climate Finance Plan as a follow up to his January Executive Order 14008 on Tackling the Climate Crisis at Home and Abroad. This International Climate Finance Plan reflects the Administration’s desire to double, by 2024, U.S. annual public climate finance to developing countries using as a baseline the average level during the second half of the Obama Administration. The Biden Climate Finance Plan is also supposed to be a boon to U.S. companies, particularly manufacturers of products and technologies viewed as environmentally beneficial. Accordingly, the Export-Import Bank of the United States is expected to play a key role in helping the Administration achieve its stated goals. As the U.S. Government’s official export credit agency, the Ex-Im Bank provides direct loans, loan guarantees, and export credit insurance in support of exports of U.S. goods, services, and technologies. By helping foreign buyers (public and private), Ex-Im Bank fills gaps in private export finance and supports U.S. jobs.

https://www.jdsupra.com/legalnews/biden-administration-to-utilize-export-6243085...


Canada’s oil and gas sector received $13 billion in EDC subsidies during the pandemic

(The Narwal, Victoria, 15 April 2021) Despite repeated promises to phase out fossil fuel subsidies, Canada’s federal government dedicated $18 billion in 2020 to assist the country’s oil and gas sector, according to a new report from Environmental Defence that outlines additional support for the industry since the COVID-19 pandemic was declared last March.  Included in the $18 billion are $3.28 billion in direct spending and $13.6 billion in public financing for oil and gas companies that primarily comes from the opaque crown corporation Export Development Canada, according to the report, Paying Polluters: Federal Financial Support to Oil and Gas in 2020.

https://thenarwhal.ca/canada-oil-gas-pandemic-subsidies-report/


Beijing and New Delhi court Indian Ocean armies with ECA loans

(African Intelligence, Paris, 1 April 2021) As China's influence around the Indian Ocean increases, New Delhi is throwing itself wholeheartedly into a diplomatic battle to protect what it considers to be its turf. In March, the Indian Navy trained a group of about fifty members of Madagascar's special forces and India's INS Shardul and Madagascar's MNS Trozona carried out joint naval exercises. During a visit to Mauritius, Indian minister of foreign affairs Subrahmanyam Jaishankar promised Prime Minister Pravind Jugnauth he would establish a $100m export credit for buying Indian military equipment, notably for the acquisition of aircraft and patrol vessels. The two countries also signed an agreement for India to supply a HAL (Hindustan Aeronautics Limited) Dhruv utility helicopter, and a patrol aircraft manufactured by Dornier, a HAL subsidiary. In 2016, New Delhi provided Mauritius with a Dornier Do-228 MP aircraft and then two Sarojini Naidu patrol vessels made by Goa Shipyard the following year. Paris is also beefing up military aid to Madagascar as Beijing and New Delhi jostle for influence.

https://www.africaintelligence.com/eastern-and-southern-africa_diplomacy/2021/04...


Tell EXIM: Cut ties with India's deadly Sasan coal plant

(Sierra Club, Oakland, 23 April 2021) More than a year has passed since the deadly April 10, 2020 coal ash disaster at the US EXIM-financed Sasan coal plant in Singrauli, India. The coal ash disaster was responsible for the deaths of six people and created a massive flood of coal ash that continues to pollute the water and community land almost a year later. Back in 2015, the Inspector General of EXIM issued a report revealing a stunning 19 fatalities at the facility. This followed a 2014 report from Sierra Club and NGOs that revealed forced resettlements, occupied houses being bulldozed in the middle of the night, labor abuses including employees handling hazardous materials without protection, and rampant environmental contamination of the local community. Since the2015 report, monitoring reports have revealed an additional eight deaths at Sasan, but the actual death count is probably even higher.

https://addup.sierraclub.org/campaigns/tell-exim-cut-ties-with-indias-deadly-sas...


US climate summit declarations deal major blow to coal in Asia

(For Our Climate, Seoul, 22 April 2021) Coal in Asia is facing a far more challenging future, with South Korean President Moon Jae-in today pledging to end public overseas coal financing and enhance its 2030 emissions target within this year, and Japan’s Prime Minister Suga committing to toughening emissions cuts at the Leaders Summit on Climate.  South Korea has been called a “climate villain” by the international community for failing to meet unambitious emissions targets and consistently ranking among the world’s top three overseas coal financiers, along with China and Japan. Most recently, the Korean government drew fire for pushing a Green New Deal domestically while its public institutions backed the Jawa 9, 10 coal power projects in Indonesia and Vung Ang 2 coal power project in Vietnam. Prime Minister Suga committed to enhancing Japan’s NDC by 46-50% below 2013 levels by 2030, and China’s President Xi Jinping committed to phasing down coal consumption in the country’s 15th five-year plan period.

http://forourclimate.org/sub/news/view.html?idx=57&curpage=1


China Is Investing in Africa’s Energy and Transportation Infrastructure

(News Ghana, Accra, 9 April 2021) These two articles examine China’s investment policy in Africa that should be read to learn the truth about China’s lending to the continent. One, is a briefing paper from China Africa Research Initiative (CARI) entitled, Twenty Years of Data on China’s Africa Lending. The second is entitled, “Why Substantial Chinese FDI is Flowing into Africa, by Shirly Yu. Combined, both papers provide a thorough analysis of the positive contribution of Chinese investment in Africa, surpassing the United States in all categories. As many African leaders know, without China’s contribution to Africa’s development, especially in infrastructure, Africa would be worse off. There is absolutely no indication that the U.S. and the West would fill that void. The China Africa Research Initiative (CARI) notes that from 2000-2019, China has made $157 billion in loans to Africa. Of these 1,077 loans, 85% have been in categories of infrastructure, of which 65% have been in energy and transportation. Only 13% of Africa’s debt is owed to China. The largest portion of Africa’s debt is owed to multilateral institutions at 32%. The four biggest Chinese banks involved with lending to African countries are China Eximbank, CDB, ICBC, and BOC. China Eximbank–which is China’s official export credit agency, and also the only bank offering government subsidized foreign aid concessional loans–is the largest and since 2000 accounts for 56 percent of all loans.

https://newsghana.com.gh/the-truth-it-is-good-that-china-is-investing-in-africas...


Boeing Forecasts Sufficient Capital for Aviation Finance

(PR Newswire, Chicago, 14 April 2021) Boeing projects global and diversified funding will continue to flow into the aircraft financing sector as the aviation sector navigates the global pandemic and vaccine deployment continues to accelerate. The 2021 CAFMO reports the aircraft financing environment ended 2020 with enough liquidity to finance deliveries, but with stresses particularly in the bank debt and tax equity markets. At the industry level, commercial aircraft delivery funding volume totaled $59 billion, a 40% decrease from 2019 levels. Aircraft lessors executed a significant volume of sale-leaseback transactions, and the industry-wide leased fleet climbed to 46%. Export credit agencies remain a small but important funding source during the pandemic.

https://www.prnewswire.com/news-releases/boeing-forecasts-sufficient-capital-for...


Iraqi, GE achieve financial close of Power Up Plan 4

(Utilities MIddle East, Dubai, 11 April 2021) GE will provide capital and spare parts, repairs and services to 7 Iraqi power plants to help maintain more reliable generation of up to 2.7 gigawatts (GW) of electricity. GE played a key role in bringing the Iraqi Ministries of Finance, Electricity and Planning together with various financial institutions, including export credit agencies, commercial banks and others, to secure financing for the project. This has been facilitated by Etihad Credit Insurance (ECI), the UAE’s Federal export credit company. GE has collaborated with various private and public financial institutions from around the world to help secure over US $2.4 billion in financing since 2015 for energy sector projects across Iraq.

https://www.utilities-me.com/news/17097-iraqi-ge-achieve-financial-close-of-powe...


Russian president signs law to ratify protocol restructuring Belarusian ECA loan

(BELTA, Minsk, 29 April 2021) Russian President Vladimir Putin has signed the law to ratify the protocol restructuring the protocol to amend the Belarusian-Russian intergovernmental agreement on the state export credit to the Belarusian government to build a nuclear power plant. During the ratification, it was noted that some $4.7 billion of the $10 billion loan provided for the construction of the Belarusian nuclear power plant was used as of 1 March this year. According to Russian government estimates, the cost of the construction will be about $6 billion. The protocol contains the following terms for restructuring Belarusian obligations: extension of the loan use period for 2 years - until the end of 2022; postponement of the grace period on the principal from 1 April 2021 to 1 April 2023; replacement of the current mixed interest rate on the loan with the fixed interest rate of 3.3% per annum.

https://eng.belta.by/economics/view/russian-president-signs-law-to-ratify-protoc...


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