ECA Watch Newsletter

What's New for November 2022

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 are the worst public finance supporters of fossil fuels over clean energy
  • European countries back weakened ECA fossil fuel financing pledge
  • Canada 2nd in the G20 for fossil fuel subsidies
  • CSOs demand reduced OECD ECA support for oil and gas
  • US Exim lags on climate despite Biden’s pledges
  • There’s no time to waste — public capital is a key conduit to a just transition
  • Gas is a false route to Australian energy security
  • Heads of G7 ECAs meet in Toronto
  • Korea to become ECA driven battery powerhouse by 2030
  • UKEF to offer ECA support for most vulnerable climate change countries
  • Berne Union AGM examines access to ECA support in African free trade
  • US Exim Bank offers finance for Romanian nuclear plants
  • Kuwait to draw on $9.2 bln from ECAs on oil projects till 2025
  • UAE ECA Etihad extends guarantees worth $4.5bn in first 9 months of 2022
  • FLASH: Italy's SACE considering fossil fuel projects with 3.5 X Italy's annual emissions

ECAs are the worst public finance supporters of fossil fuels over clean energy

(Oil Change International, Washington, 1 November 2022) OCI's new report “At a Crossroads: Assessing G20 and MDB international energy finance ahead of stop funding fossils pledge deadline” looks at G20 country and MDB traceable international public finance for fossil fuels from 2019-2021 and finds they are still backing at least USD 55 billion per year in oil, gas, and coal projects. This is a 35% drop compared to previous years (2016-2018), but still, almost twice the support provided for clean energy, which averaged only $29 billion per year. ECAs were the worst public finance actors, providing seven times more support for fossil fuels than clean energy – at least $34 billion per year for fossil fuels and just $4.7 billion for clean energy. The report analyzes finance from OCI’s open-access database, and Public Finance for Energy's Database (energyfinance.org), which have been updated alongside the release of this report. It tracks financial flows to fossil fuels and clean energy from G20 bilateral development finance institutions (DFIs), export finance agencies (ECAs), and the multilateral development banks (MDBs). The report from OCI and Friends of the Earth US has been endorsed by a long list of international civil society organizations.

http://priceofoil.org/g20-at-a-crossroads


European countries back weakened ECA fossil fuel financing pledge

(Financial Management Magazine, Durham, 4 November 2022) As noted in our October What's New, ten European countries had agreed to spell out this year how they will limit export finance support for overseas fossil fuel projects. But they shelved a draft pledge to explicitly end it after pushback from Italy. The final statement was weaker than a previous draft seen by Reuters. At the UN COP26 climate summit in November 2021, 39 countries and financial institutions, including the Netherlands, signed the Glasgow Statement on International Public Support for the Clean Energy Transition, committing signatories to end their direct international public financing for fossil fuels by the end of 2022, except in exceptional circumstances, and fully prioritize their public finance for clean energy transition. If all signatories followed through on their pledges with integrity, this could directly shift US$28 billion a year from fossil fuels to clean energy and help shift even larger sums of public and private money away from investments in climate-harming fossil fuels. International and Dutch NGOs now argue that the new policy published by the Dutch Government on restricting finance for fossil fuels has such significant loopholes, that it essentially means the Netherlands has reneged on its promise. The Dutch government said it intends to stop giving companies and banks credit insurance for exports in the fossil fuel sector as of Jan. 1, following through on a pledge made at the COP-26 climate conference in Glasgow. When the pledge was announced in 2021, the Cabinet said it did so knowing it would put Dutch exporters at a competitive disadvantage to exporters in countries that do still offer such insurance and the Finance Ministry said the Netherlands might reconsider the policy if other countries fail to adhere to their COP-26 pledges. According to Statistics Netherlands (CBS), petroleum and petroleum products made up 9.3% of Dutch exports in 2021, with a trade value of 54.7 billion euros. Around 20 countries including Germany, the United States, Britain and Canada made similar commitments, but only a few including France have so far implemented them into policy. On the other hand, Australia chose not to sign the Glasgow Statement at a public event held at Cop27 in Sharm el-Sheikh.

https://www.fm-magazine.com/news/2022/nov/european-countries-back-weakened-fossi...


Canada 2nd in the G20 for fossil fuel subsidies

(The Saxon, Salisbury, ? November 2022) Canada continues to heavily subsidize fossil fuels despite its international commitments, according to a report by Oil Change International. The nonprofit estimates that Canada has, on average, given up to US$8.5 billion annually to projects related to this type of energy between 2019 and 2021. Among G20 countries, Canada is the second most publicly funded fossil fuel project. Only Japan spends more, with an annual average of US$10.6 billion. South Korea and China complete the front runners with US$7.3 billion and US$6.7 billion respectively in subsidies to the fossil fuel sector. France, Brazil and Germany lead the G20 in green energy subsidies, with US$2.8 billion, US$2.5 billion and US$2.2 billion, respectively. Canada, meanwhile, spends about US$800 million.

https://thesaxon.org/canada-would-be-2nd-in-the-g20-for-fossil-fuel-subsidies/


CSOs demand reduced OECD ECA support for oil and gas

(Price of Oil, Washington, November 2022) This document signed by 54 international civil society organizations outlines how the OECD Arrangement on Officially Supported Export Credits can align with the Paris Agreement warming target of 1.5°C by placing restrictions on export support for oil and gas projects and associated infrastructure. These restrictions build on the existing prohibition on coal-fired power, which came into effect 1 January 2022 and was preceded by the coal-fired power sector understanding (CFSU).

http://priceofoil.org/content/uploads/2022/11/CSO-Joint-Position-on-OECD-oil-and...


US Exim lags on climate despite Biden’s pledges

(Global Trade Review, London, 2 November 2022) The US Export-Import Bank (US Exim) has become the latest export finance institution to be labelled as unaligned with the Paris Agreement on combatting climate change, despite overall emissions from the projects it backs falling in recent years. US Exim is trailing many of its peers in other developed nations because of its large exposures to the fossil fuel and aviation sectors, has no target to reach net zero greenhouse gas emissions and is not transparent enough on how it is carrying out US government guidance on phasing out support for fossil fuels, according to a report by German think tank Perspectives Climate Group.

https://www.gtreview.com/news/global/us-exim-lags-on-climate-despite-bidens-pled...


There’s no time to waste — public capital is a key conduit to a just transition

(Atlantic Council, Washington, 8 November 2022) It is abundantly clear that achieving net-zero carbon emissions by mid-century is necessary to avoid the worst climate outcomes. However, the path to decarbonizing the energy sector is not “one-size-fits-all” between developed and developing markets.Looking at the future energy mix globally, new renewables capacity will dominate with developing countries representing more than half of new capacity investment, driven primarily by China and India. Public capital plays an essential role in accelerating energy infrastructure projects in both developed and developing markets. Governmental organizations such as export credit agencies (ECAs) and development finance institutions (DFIs) provide essential liquidity tools, risk management expertise, and credit support that enables meaningful private sector investment.

https://www.atlanticcouncil.org/blogs/energysource/with-cop27-underway-theres-no...


Gas is a false route to Australian energy security

(Yahoo News, Sydney, 1 November 2022) Australia is being urged to change course and end taxpayer-funded investment in fossil fuel projects. Ahead of climate talks in Cairo, campaigners are calling for the Albanese government to join a group of countries that last year pledged to end international public financing of coal, oil and gas development. Australia is one of the largest recipients of international public investment in fossil fuels, according to a report by Oil Change International and Friends of the Earth US. Public finance from Australia's export credit agency was also heavily in favour of fossil fuels, the report found. Australia is also building what could be the world's dirtiest offshore LNG project, the Barossa project, with the help of overseas public finance from South Korea and Japan

https://au.news.yahoo.com/gas-false-route-energy-security-060001189.html


Heads of G7 ECAs meet in Toronto

(UK Government, Toronto, 3 November 2022) The leaders of the official export credit agencies from the G7 nations – Canada, France, Germany, Italy, Japan, United Kingdom and the United States of America – were hosted by Export Development Canada in Toronto, Canada to discuss a number of pressing geopolitical, economic and sustainability matters impacting exporters and global trade flows. Discussions examined how the G7 ECA Heads are moving their organizations forward on digitalization, climate change, inclusive trade, and how ECAs can serve as strategic accelerators for the growth of small- and medium-sized exporters. The G7 ECA Heads focused on the impacts of the Russia/Ukraine war on global supply chains, energy security, and how ECAs can support their exporters through turbulent times and how they can work together to support Ukraine as it rebuilds. The G7 ECA Heads are unified in their strong desire to heighten their relevance to their nations’ exporters and explored ways to accelerate collective efforts to modernize the OECD Arrangement on Officially Supported Export Credits. Acknowledging the themes expressed in the recent G7 Political Leaders’ Communique, the ECA Heads recognized the need for bold contributions to climate action and discussed alignment of shared climate policy obligations and ongoing efforts to support companies through the global energy transition. The next annual meeting of the ECA Heads will be held in Italy in 2023.

https://www.gov.uk/government/news/heads-of-g7-export-credit-agencies-meeting-co...


Korea to become ECA driven battery powerhouse by 2030

(Korea Times, Seoul, 29 November 2022) The government is aiming to make Korea-produced batteries account for at least 40 percent of global market share by 2030, as assisted by the establishment of an intergovernmental alliance to secure key battery materials, fostering a sustainable industrial ecosystem and expansion of tax credits, the trade ministry said Tuesday. The government will form and strengthen alliances with resource-rich countries, including Australia, Canada and Chile. Materials secured from the three countries will be refined there, or in nearby countries with which the U.S. has a free trade agreement. Up to 3 trillion Won in loans and guarantees will be provided over the next five years for industry players investing in refining and smelting projects, as mediated and overseen by Korea Trade Insurance Corp., an export credit agency and Export-Import Bank of Korea (Eximbank), a state-run lender.

https://koreatimes.co.kr/www/nation/2022/11/419_338997.html


UKEF to offer ECA support for most vulnerable climate change countries

(Reuters, London, 8 November 2022) Britain plans to offer new loans to support countries most vulnerable to the effects of climate change, including the option to defer debt repayments in the event of catastrophes, the finance ministry said on Tuesday. The country's export credit agency, UK Export Finance (UKEF), will provide such loans to low-income countries and small island developing states. Details of the plans will be given at the COP27 climate summit in Sharm el-Sheikh, Egypt. The proposals would allow vulnerable countries to defer debt repayments to free up resources to fund disaster relief, the ministry said. Reuters has noted that promises by companies, banks and cities to achieve net-zero emissions often amount to little more than greenwashing according to the UN as it set out proposed new standards to harden net-zero claims. With the world in the midst of the first global energy crisis – triggered by Russia's invasion of Ukraine – the IEA's World Energy Outlook 2022 (WEO) provides indispensable analysis and insights on the implications of this profound and ongoing shock across the globe.

https://www.reuters.com/business/cop/uk-offer-loans-countries-most-vulnerable-cl...


Berne Union AGM examines access to ECA support in African free trade

(Kigali Today Press, Kigali, 9 November 2022) At the 2022 Annual Meeting of the Berne Union in Rwanda, the African continent looked to recover from the effects of the Covid-19 pandemic and the Russia-Ukraine conflict. Removing barriers that affect cross-border trade and ensuring access to export credit facilities will be key in driving growth and the realisation of the African Continental Free Trade Area (AfCFTA).

https://www.ktpress.rw/2022/11/berne-union-agm-access-to-export-credit-removing-...


US Exim Bank offers finance for Romanian nuclear plants

(World Nuclear News, London, 9 November 2022) The Export-Import Bank (Exim) - the USA's official export credit agency - has issued two Letters of Interest for the financing of US-sourced pre-project technical services at the Cernavoda 3 and 4 nuclear power project in Romania. According to Romanian utility Nuclearelectrica, based on the preliminary information submitted, Exim would be able to consider financing up to USD50 million of the US export contract for pre-project engineering services as part of the engineering multiplier programme and up to USD3 billion of the US export contract for engineering and project management services for the completion of the partially-built Cernavoda units 3 and 4.

https://www.world-nuclear-news.org/Articles/US-Exim-Bank-offers-finance-for-Cern...


Kuwait to draw on $9.2 bln from ECAs on oil projects till 2025

(Zawya, Dubai, 7 November 2022) Kuwait is planning to spend 13.3 billion Kuwaiti dinars ($44 billion) on oil production, exploration and other projects until 2025, a newspaper in the OPEC producer reported on Monday. The investments are part of a 5-year plan approved in 2021 and envisages total spending of 20.2 billion dinars ($66.6 billion) and borrowing 6 billion dinars ($19.8 billion) by the Kuwait Petroleum Corporation (KPC), which manages the emirate’s hydrocarbon sector, The spending plan takes into account “changes in the global oil and financial markets” the paper said, adding that capital spending accounts for nearly 65 percent of the total expenditure during the plan. Borrowings include nearly 29 percent in bank loans and 21% from export credit agencies in addition to 50 percent through short, medium and long terms bonds, the report noted.

https://www.zawya.com/en/projects/oil-and-gas/kuwait-to-spend-44bln-on-oil-proje...


UAE ECA Etihad extends guarantees worth $4.5bn in first 9 months of 2022

(National News, Abu Dhabi, 14 November 2022) Etihad Credit Insurance, the UAE's export credit agency, issued 7,936 revolving credit guarantees worth Dh16.6 billion ($4.5bn) in the first nine months of the year to help boost the country’s non-oil foreign trade. ECI-issued credit guarantees from January until September helped facilitate non-oil trade for businesses located in the UAE that have exported to 111 countries, ECI said in a statement on Monday. These state-backed guarantees helped to preserve and create 50,000 jobs by supporting companies, 72% of which were small and medium enterprises, ECI said.

https://www.thenationalnews.com/business/economy/2022/11/14/etihad-credit-insura...


FLASH: Italy's SACE considering fossil fuel projects with 3.5 X Italy's annual emissions

(Oil Change International, Washington, 30 November 2022) Despite pledging to stop international financing for fossil fuel projects by the end of 2022, new analysis shows that the Italian Government is continuing to actively consider financing for major international fossil fuel projects. Taken together, these fossil fuel projects in could emit or enable greenhouse gas emissions equivalent to at least 3.5 times Italy’s annual emissions.  In the period 2019-2021, Italy provided USD 2.8 billion a year in public finance for fossil fuels, almost entirely via SACE. Bloomberg notes that SACE has also been among the biggest backers of Russian oil, gas and petrochemical development in the last several years. Not included is another known fossil fuel project being considered by SACE - the Balikpapan refinery in Indonesia. Recommon notes: “While Italy has publicly committed to stop financing fossil fuel projects, it has tried several times to weaken the pledge to stop export credit support for fossil fuel projects. With less than one month to go until the end of 2022, there is still no sign of implementation of the Glasgow Statement.

https://priceofoil.org/2022/11/30/italian-government-considering-support-for-int...


What's New October 2022

"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.

  • Finland joins growing list of countries restricting international oil and gas finance
  • Friends of the Earth US asks Biden to RELEASE THE GUIDANCE
  • Italy pushes to weaken European fossil fuel financing pledge
  • German ECA supported defence system for Egypt diverted to Ukraine
  • Korean Eximbank holds OECD Environmental and Social Practitioners' Meeting
  • South Korean ECAs challenged during National Assembly session about Barossa Project
  • Trade unions call for a just net-zero aviation transition including ECA support for aviation finance
  • Cesce and Alstom sign a strategic agreement to promote green exports
  • Loss of ECA finance harms lower impact deep water oil and gas says offshore chief
  • Export finance in a post-pandemic world
  • Russia may start providing ECA finance to importers of its grain
  • Ukraine calls on banks to support exports through new ECA mechanisms
  • Brazilian ECA to fund Embraer aircraft exports to SkyWest
  • Saudi Electricity Company lands Swedish ECA backed finance for Egypt electricity interconnection

Finland joins growing list of countries restricting international oil & gas finance

(Oil Change International, Washington, 12 October 2022) Finland has joined a growing list of countries making good on a key pledge from the UN COP26 climate summit in Glasgow last year, by releasing a new policy ending almost all support for fossil fuels via Finnvera, the Finnish Government’s export credit agency, leaving Norway the only Nordic country not to do so. Finland joins the UK, France, Denmark, Sweden and Belgium in publishing policies restricting fossil fuel finance to deliver on the COP26 commitment, building momentum ahead of the COP27 UN climate summit in Egypt next month. Countries that have yet to deliver on their promise to end fossil fuel finance include the USA, Canada, Germany, Italy and the Netherlands. Analysis shows that if all Glasgow Statement signatories live up to their commitment this will directly shift USD 28 billion a year out of fossil fuels and into clean energy, which will help shift even larger sums of public and private finance. This would also help raise pressure on the countries that are lagging behind. Laggards include Japan ($10.9 bn/yr), Korea ($10.6 bn/yr), and China ($7.6 bn/yr), which are the largest providers of international public fossil fuel finance in the G20 and together account for 46% of G20 and MDB finance for fossil fuels. The European Bank for Reconstruction and Development (EBRD), one of the biggest EU fossil fuel financiers, is also missing. Export Credit Agencies (ECAs) are the worst public finance actors on fossil fuels, with G20 ECAs having supported 11 times more in fossil fuels (USD 40.1 billion) than in renewable energy (USD 3.5 billion) from 2018-2020, effective leadership in aligning ECAs with climate goals is desperately needed. The E3F Transparency report outlines that from 2015-2020, E3F members supported almost 175 billion Euros in fossil fuels compared to only 20 billion Euros in renewables.

https://priceofoil.org/2022/10/12/finland-joins-growing-list-of-countries-restri...


Friends of the Earth US asks Biden to "RELEASE THE GUIDANCE!"

(Friends of the Earth US, Washington, 24 October 2022) Friends of the Earth US has produced a 16 page backgrounder on U.S. international energy finance ahead of the COP27 Deadline to Stop Funding Fossils. From 2010 to 2021, the United States’ major trade and development finance institutions, the U.S. Export Import Bank (EXIM) and U.S. International Development Finance Corporation (DFC), provided almost five times as much support to fossil fuels as to renewables – USD 51.6 billion compared to USD 10.9 billion. Since taking office, the Biden-Harris Administration have made a series of commitments, executive orders, and guidances towards ending this international public finance for fossil fuels. Unfortunately, the administration’s actions have yet not matched their promises on ending these influential financial flows that prolong the fossil fuel era. In this briefing, Friends of the Earth USA review what is known about the current U.S. policy guidance, unpack trends in recent energy finance from EXIM and DFC, identify specific fossil fuel projects and loopholes that appear to be under consideration, and make recommendations for how the U.S. can still implement their commitments with integrity and on time. Most critically, Biden’s interim guidance detailing how these promises will be implemented has not been made publicly available since it was put in place in December 2021, and it appears to leave substantial loopholes open for continued support for gas and oil. The Biden-Harris Administration can avoid undermining international progress on this issue by releasing a publicly available policy that fully ends international public finance for fossil fuels by COP27 in November.

https://foeus.wpenginepowered.com/wp-content/uploads/2022/10/US_International_En...


Italy pushes to weaken European fossil fuel financing pledge

(Reuters, Brussels, 2 November 2022) Italy is attempting to weaken a pledge 10 European governments intend to make to stop export credit support for fossil fuel projects. The pressure from Italy comes as delegates from nearly 200 countries prepare for a United Nations climate change summit next week in Egypt, where world leaders will attempt to agree tougher action to tackle global warming. A group of ministers planned to make a joint statement on November 3rd committing to end public trade and export finance support for overseas fossil fuel projects by the end of 2022. The countries, which together make up the "Export Finance for Future" group, are Belgium, Denmark, Finland, France, Germany, Italy, the Netherlands, Spain, Sweden and Britain. [Delays in the statement's release point to controversial negotiations.] A draft of the governments' statement, seen by Reuters, said they would agree to end new direct official trade and export finance support for "exploration, production, transportation, storage, refining, distribution of coal, crude oil, natural gas, and unabated power generation". Three sources familiar with the discussions told Reuters Italy had asked to remove the list specifying which fossil fuel activities would lose such support. "Italy objects that there is no consistency between the objective of achieving strategic autonomy from Russia and the impossibility of financing the necessary infrastructure," an official briefed on Rome's position told Reuters. Italy's export credit agency SACE declined to comment. As countries attempt to balance fighting climate change with their short-term response to the energy crisis, some - including Germany - have suggested new investments in gas fields are needed. Countries are still negotiating the draft statement, which could change before it is published. Italy was the biggest backer of fossil fuels within the group, committing 8.4 billion euros in the period - with downstream oil and gas projects and gas-fuelled power plants among the projects. Italy is also moving to keep a Lukoil-owned refinery in business despite new sanctions against Russia kicking in next month.  On September 30 the European Commission approved, under EU State aid rules, a €2 billion Italian scheme for the reinsurance of natural gas and electricity trade credit risk in the context of Russia's war against Ukraine. A hard right coalition that includes pro-Russian voices just took power in Italy after running a campaign focused on energy costs and inflation.

https://www.reuters.com/business/cop/exclusive-italy-pushes-weaken-fossil-fuel-f...


German ECA supported defense system for Egypt diverted to Ukraine

(Military Africa, Nigeria, 13 October 2022) Germany has sent a consignment of IRIS-T surface-to-air defence system initially meant for Egypt to Ukraine to protect critical assets following the Russian invasion of the country. Egypt paid for the IRIS-T air defence system in 2019 after Germany’s Bundestag’s Budget Committee gave its approval for an export credit guarantee for six A-200 vessels, thereby clearing a path for the frigate deal to go ahead. The export credit provides guarantees of up to 2.3 billion euros for the transaction.

https://www.military.africa/2022/10/egypts-iris-t-air-defence-battery-has-been-d...


Korean Eximbank holds OECD Environmental and Social Practitioners' Meeting

(Korea Times, Soeul, 24 October 2022) The Export-Import Bank of Korea (Eximbank) is holding a meeting of environmental and social practitioners October 24-25 to help address environmental and social issues when providing officially supported export credits. Eximbank is co-hosting the 46th OECD Environmental and Social Practitioners' Meeting in Seoul jointly with the Korea Trade Insurance Corporation. The meetings have been held at the OECD headquarters in Paris in the first half of each year, while the meetings for the second half are held in one of the member countries. Around 50 experts from 25 OECD member countries are participating, sharing ideas to evaluate the environmental and social impact of projects and policies and practices related to due diligence where official export credit support is requested, as well as minimizing such impact. A Korean Eximbank employee was appointed in 2018 as chair of the OECD Working Party on Export Credits and Credit Guarantees, an entity established in 1963 under the Trade Committee of the OECD

https://www.koreatimes.co.kr/www/biz/2022/11/602_338467.html


South Korean ECAs challenged during National Assembly session about Barossa Project

(Friends of the Earch US, Washington, 24 October 2022) During the annual National Assembly audit this month, Korea Export-Import Bank (KEXIM) and Korea Trade Insurance Corporation (K-SURE) were questioned by assembly members on their decision to finance the Barossa gas project in Australia. The Barossa project, spearheaded by Australia’s Santos and Korea’s SK E&S, was recently ordered to halt drilling after the Australian Federal Court decided Traditional Owners had not been properly consulted. While both KEXIM and K-SURE have approved a total of USD 660 million (KRW 800 billion) of additional financing for the project, the financial deal has not been closed yet. During this year’s National Assembly audit session, K-SURE was reprimanded for violating international environmental regulations and was questioned on the Ministry of Environment’s greenwashing ruling around SK E&S’ advertisements about Barossa gas. K-SURE stated that it screened the project in accordance with international guidelines and Australian law. It also claimed that if Santos loses its Barossa drilling appeal heard at the Australian Federal Court, it will likely decide whether to proceed with its financing. A hearing from a National Assembly member revealed that K-SURE was aware of the lack of Indigenous consultation but relied on the words of project owners and commercial banks supporting the gas project, showing a passive review process in deciding to provide billions of wons' worth of taxpayer money. With continued criticism from assembly members, the Chairman of K-SURE stated that the agency will comprehensively review various risks associated with the project before deciding whether to extend the expiration date of its financing approval, which is January 2023.  Environmental activists have continued to demand the cancellation of public financing toward the Barossa gas project.




Trade unions call for a just net-zero aviation transition including ECA support for aviation finance

(IndustriALL, Geneva, 14 October 2022) International and European trade unions welcome a new global agreement for net-zero carbon aviation emissions by 2050, but call for stronger commitments at country level, including on social criteria. No worker or region should be left behind, we need a Just Transition for all! In the run up to the September 2022 41st General Assembly of ICAO, unions worked together to draft joint trade union demands. The working paper submitted to ICAO by trade unions called for a Just Transition for a zero-carbon future which emphasised the need for the decarbonisation of the aviation industry to be managed in a socially responsible way. It called for quality social dialogue, investment into training and the creation of sectoral action plans by social partners with the relevant authorities. In March 2021, unions pointed out that airline passenger demand fell 65% in 2020 compared to the previous year and the demand for commercial aerospace products had also fallen dramatically, resulting in hundreds of thousands of workers in the sectors beening laid off and noting that export credit agency support was critical for restoring employment levels.

https://www.industriall-union.org/aviation-unions-welcome-global-agreement-on-ne...


Cesce and Alstom sign a strategic agreement to promote green exports

(WebWire, Atlanta, 12 October 2022) Cesce, the Spanish Export Credit Agency, will support France's Alstom Group’s export activities focused on green projects with a dedicated amount of €500 million. -The agreement seeks to strengthen and consolidate the Spanish railway industrial footprint, in which Alstom is a key player with more than 3,000 employees in Spain and a volume of local purchases close to 700 million euros in the last year. The agreement provides for an overall annual maximum of €500 million and will be reviewed on a yearly basis, depending on the evolution of employment levels, investment and exports of Alstom Group companies in Spain. The agreement's scope focuses on green operations, in line with Cesce’s climate change policy, the importance of promoting sustainable mobility initiatives and the need to boost digitalisation and sector transformation for a decarbonised future.

https://www.webwire.com/ViewPressRel.asp?aId=295352


Loss of ECA finance harms lower impact deep water oil and gas says offshore chief

(UpStream Online, Oslo, 3 October 2022) The world needs to put the right emphasis onto the security aspect of energy policy, with deep-water oil and gas developments playing a key role in this reset, Bruno Chabas, head of Dutch floating production giant SBM Offshore told an audience at the Rio Oil & Gas event on Tuesday. Deep-water developments are one of the segments that can best respond to the global demand for hydrocarbons with lower break-even, lower environmental impact and lower carbon intensity, he argued. Investment levels for oil and gas are recovering somewhat after declining drastically, Chabas said, but he warned that financing will continue to face constraints such as the decision by the European Union and other key countries to end any access to export credit agency (ECA) financing for fossil fuels. “If ECAs are unable to finance oil and gas projects, this just leaves the commercial banks, but they too want to be on the side of decarbonisation,” Chabas said. Deep-water oil production currently runs at about 8.3 million barrels per day, representing 8% of global output, with Brazil representing about 36% of that. [The relative dangers and advantages of offshore vs onshore drilling is a controversial subject.]

https://www.upstreamonline.com/politics/deep-water-oil-and-gas-have-a-key-role-t...


GTR: Export finance in a post-pandemic world

(Global Trade Review, London, 26 October 2022) After a period of unprecedented disruption, the export finance market is now firmly focused on recovery, growth and innovation. The latest edition of GTR’s annual export finance roundtable gathered a group of regional and global industry heads to discuss the evolving role of export credit agencies (ECAs), changing patterns around claims, and the ever-growing importance of environmental, social and governance (ESG) reforms. This piece provides a twelve page GTR report/summary of a 7 person roundtable. In another GTR review, they note that in the wake of the pandemic, export credit agencies shifted their offerings and increased their exposure to domestic transactions. Some are now looking to regear these programmes to support wider government policies, such as bolstering manufacturing or tackling the climate crisis. As they do so, concerns are growing about over-concentration in certain sectors and the neglect of developing markets.

https://www.gtreview.com/magazine/the-export-finance-issue-2022/export-finance-i...


Russia may start providing ECA finance to importers of its grain

(Reuters, Moscow, 3 October 2022) Russia may start providing trade finance to importers of its grain as sanctions imposed on Moscow since it sent troops to Ukraine affect this financial instrument, Agriculture Minister Dmitry Patrushev said. Russia, the world's largest wheat exporter, is working with Russia's Eximbank and the Russian agency for export credit and investment insurance "to provide financing to foreign companies for the purchase of our products", Patrushev told the RBC business daily. Speaking about farmers being among those drafted into the military in Russia's partial mobilisation at a busy time in the sowing season, Patrushev said his ministry would make efforts to ensure the smooth running of the farming industry.

https://www.reuters.com/markets/commodities/russia-may-start-providing-trade-fin...


Ukraine calls on banks to support exports through new ECA mechanisms

(GMK Center, 30 September 2022) The Ministry of Economy calls on banks to support Ukrainian exports of goods, works and services during the war, using the products of the Export Credit Agency (ECA). The Ministry, together with the National Bank, developed a mechanism that allows issuing affordable loans for the implementation of export contracts without collateral under ECA insurance coverage. The agency launched the portfolio insurance mechanism for loans issued for the export contracts execution in June 2022. Today, financial support for export-oriented businesses is provided by Oschadbank, Ukrgasbank and Ukreximbank. As the first deputy prime minister – Minister of Economy Yulia Sviridenko noted, they have already financed the insurance of 24 loan contracts for UAH 70 million (US$1.9 m), which made it possible to export UAH 323.5 million (US$8.76 m). As GMK Center reported earlier, Ukraine expects to receive an additional $12.3 billion in financial support from the United States.

https://gmk.center/en/news/ministry-of-economy-calls-on-banks-to-support-ukraini...


Brazilian ECA to fund Embraer aircraft exports to SkyWest

Brazilian state development bank BNDES and planemaker Embraer SA (EMBR3.SA) have entered a deal for the lender to fund exports of six E-175 jets to U.S.-based carrier SkyWest Inc (SKYW.O), the bank's managing director told Reuters. Bruno Aranha said in an interview that the loan was modeled as a post-shipment export credit, through which BNDES will fund the exports and SkyWest assume the debt. Aranha said the bank could also help funding exports of Embraer's KC-390 military aircraft ahead, though noting that such deals could take longer to be completed as they would involve foreign nations and their public sectors.

https://www.reuters.com/business/aerospace-defense/brazil-state-bank-fund-embrae...


Saudi Electricity Company lands Swedish ECA backed finance for Egypt electricity interconnection

(Global Trade Review, London, 28 September 2022) Saudi Electricity Company has signed a US$566.4mn export ECA backed facility agreement with Standard Chartered Bank and Sumitomo Mitsui Banking Corporation to support a Saudi Arabia-Egypt electricity interconnection project. The 14-year financing is guaranteed by the Swedish Export Credit Agency (EKN) and funded by the Swedish Export Credit Corporation (SEK). The landmark facility is structured on the concept of commodity murabaha – a cost-plus-profit arrangement which complies with Islamic finance standards. Coming after the two countries signed US$1.8bn worth of contracts in Cairo last year to build transmission plants and connect power grids, the electricity interconnection project is the first large-scale, high-voltage direct current interconnection between the Middle East and North Africa. Once completed, the project will allow Saudi Arabia and Egypt to exchange up to 3,000 MW of power.

https://www.gtreview.com/news/mena/saudi-electricity-company-lands-eca-backed-fi...


What's New September 2022

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.

  • France restricts oil & gas finance to meet climate commitments, piling pressure on Germany USA Canada to follow suit
  • Sweden restricts ECA fossil fuel finance to deliver on climate commitment
  • Berne Union report warns of dwindling risk appetite over Ukraine related claims
  • Ukraine seeks $400 billion for foreign investment & export credit
  • U.S. EXIM Bank  Ukraine pledge cooperation on financing reconstruction
  • EXIM strategy: Climate change,  China, OECD ECA backsliding challenge competitiveness
  • Sri Lanka’s Chinese debt making international headlines
  • China’s no new coal power overseas pledge one year on
  • EU challenges China’s Belt and Road with €300bn Global Gateway
  • Iranian & Russian ECAs ink agreement to facilitate trade
  • India has $5 bn new export opportunity in Russia
  • US exports face empty container pile-up as supply chains recover
  • The role of ECAs in financing the transition to net zero
  • TFG partners with UKEF and DIT to create a trade and export finance guide
  • Chilean firm to receive Korean ECA $100 million fund for stable Australian lithium supply to South Korean firms

France restricts oil & gas finance to meet climate commitments, piling pressure on Germany, USA, Canada to follow suit

(Oil Change International, Washington, 26 September 2022) the French Government has published a new policy that restricts public finance for fossil fuels from the French export credit agency, BPIFrance. This policy is meant to implement France’s commitment to end international public finance for fossil fuels by the end of 2022, which it made at the UN Climate Conference in Glasgow last year along with 38 other countries and financial institutions (The Glasgow Statement). The French Development Agency (AFD), which is also subject to the Glasgow commitment, had already adopted a near-complete fossil fuel exclusion in 2019. The policy – which will be enacted in law through the French Government’s budget – is a landmark win for French campaigners who have been calling for an end to French export finance for fossil fuel projects for years. In addition, it builds pressure on fellow Glasgow Statement signatories to keep their promise and announce their Glasgow-compliant policies by the upcoming COP27 UN Climate Conference in Egypt. So far, the United Kingdom, Denmark, Belgium, Sweden and now France have published policies to implement their Glasgow commitment. The new policy implements a commitment made at last year’s UN Climate Conference to end almost all French government-backed financing for international fossil fuel projects, responsible for €9.3bn in public finance for oil and gas between 2009 and 2019

https://priceofoil.org/2022/09/26/france-restricts-oil-and-gas-finance-to-meet-c...


Sweden restricts ECA fossil fuel finance to deliver on climate commitment

(Oil Change International, Washington, 20 September 2022) At the COP26 United Nations Climate Conference in Glasgow, 39 countries and institutions signed up to the Glasgow Statement, committing themselves to ending “new direct public support for the international unabated fossil fuel energy sector by the end of 2022, except in limited and clearly defined circumstances that are consistent with a 1.5°C warming limit and the goals of the Paris Agreement.” The initiative has the potential to shift $39 billion a year out of fossil fuel projects and into clean energy if countries keep their promises. As the deadline for implementing the Statement looms, the Swedish export credit agencies, SEK and EKN, have released an updated policy. A previously-released policy aligned Swedfund – the Swedish development finance institution – with the Glasgow Statement.

https://priceofoil.org/2022/09/20/sweden-public-finance-policy/


Berne Union report warns of dwindling risk appetite over Ukraine related claims

(Global Trade Review, London, 31 August 2022) Rising geopolitical risk is driving up demand for export credit insurance, says a new Berne Union study, which warns that the market is bracing for a wave of Ukraine-related claims. According to the association’s latest ‘Business Confidence Index’ report, providers of short, as well as medium and long-term credit and political risk insurance, have seen “strong” levels of demand this year. The quarterly analysis, based on a survey of the Berne Union’s more than 80 members – including export credit agencies, private credit insurers and multilateral financial institutions – reveals that requests for short-term cover have been especially robust. “Payment delays directly caused by the war are materialising for some insurers and there is a general expectation that liquidity constraints and higher interest rates will lead to increasing insolvencies in the third quarter,” the report says. In a world where roughly 15% of trade is protected by insurance, eyes are often on the trade credit insurance stage.

https://www.gtreview.com/news/global/credit-insurers-warn-of-dwindling-risk-appe...


Ukraine seeks $400 billion for foreign investment & export credit

(Pipa News, Pakistan,7 September 2022) Ukraine has begun attracting foreign investment of up to $400 billion in projects across the economy, even as it faces a protracted war with Russia and a slump in production. The Kiev government has identified hundreds of technology, agribusiness, clean energy, defense, metallurgy and natural resources initiatives that it hopes will attract international investors, backed by loan guarantees and insurance from Western donors. Ukrainian officials recognize that Western investors need protection. They want access to World Bank war risk insurance products and Western export credit institutions to provide guarantees.

https://pipanews.com/ukraine-launches-400-billion-for-foreign-investment-financi...


U.S. EXIM Bank, Ukraine pledge cooperation on financing, reconstruction

(Reuters, Washington, 30 August 2022) The head of the EXIM and a senior Ukrainian development minister have pledged to keep working on U.S. financing opportunities to support Ukraine's energy security and infrastructure, the export credit agency said. The meeting between EXIM Chair Reta Jo Lewis and Ukrainian Minister for Communities and Territories Development Oleksiy Chernyshov came exactly a year after EXIM and Ukraine signed a memorandum of understanding to identify $3 billion in EXIM-supported export financing projects for Ukraine, including road, rail and energy infrastructure. In March, less than a month after Russia's invasion started, EXIM and its fellow export credit agencies in Britain and Canada withdrew all new export credit support for Russia and Belarus.

https://www.reuters.com/world/europe/us-exim-bank-ukraine-pledge-cooperation-fin...


EXIM strategy: Climate change, China, OECD ECA backsliding challenge competitiveness

TFX, London, 14 September 2022) The most recent edition of US EXIM’s Competitiveness Report makes plain that although US EXIM medium- and long-term support has grown since obtaining a quorum in 2019, much more must be done to advance America’s export competitiveness in an era of volatility and crowded competition. Released at the end of June, there were few surprises in the focus of the 55th edition of US EXIM’s Competitiveness Report – in short, climate change and US exporters facing increased competition from Chinese companies backed by historic levels of their government’s financing. But if the focus was no surprise, the wider scope of the challenges facing US EXIM was. The key point is that China is not US EXIM’s only problem. By not complying with OECD rules China has induced other countries to follow suit, skewing the competitive landscape. Indeed, many European ECAs have extended and developed their pandemic flexibility, offering new and innovative support for domestic and foreign exporters that don’t necessarily meet the terms of the OECD arrangement. As such US EXIM faces considerable challenges facilitating a level playing field.

https://www.txfnews.com/articles/7440/ECA-strategy-Can-US-EXIM-raise-its-global-...


Sri Lanka’s Chinese debt making international headlines

(The Island, Colombo, 9 September 2022) Sri Lanka’s debt to China is making headlines in international and local media again. Media reports partly blame China and its lending practices, for Sri Lanka’s debt crisis, says a Verité Research media release. It said: The publication titled: “The Lure of Chinese Loans: Sri Lanka’s experiment with a special framework to finance its infrastructure” sheds light on the perils of creating frameworks to facilitate deviations from competitive bidding to tap into concessional export credit from emerging economies such as China. The report analyses the design and execution of the special framework and finds that the lack of rigour in the evaluation process and the ability of decision-makers to exercise excessive discretion made the framework highly prone to abuse and misuse.

https://island.lk/sri-lankas-chinese-debt-making-international-headlines/


China’s no new coal power overseas pledge, one year on

(China Dialogue, London (Beijing?), 22 September 2020) Reform of investment and financing models still needed in order to better support green transitions. On 21 September 2021, China’s president, Xi Jinping, told the UN General Assembly via video link that China would increase support for green and low-carbon energy in developing countries, and not build any new coal-fired power projects overseas. China has been a major builder of coal power plants around the world, often providing both the finance and the technology. The Exim Bank of China, the China Development Bank (CDB) and the China Export and Credit Insurance Corporation (Sinosure) are the main state-owned financial institutions funding overseas projects, and as such have been quick to respond to the change in government policy. Exim Bank has successfully issued 3 billion yuan (US$425 million) in green bonds earmarked for clean energy investment. The Green Belt and Road Initiative Center provides research, analyses and information on the policies, economics, environment, sustainability and green finance of the Belt and Road Initiative (BRI) - also known as Silk Road Initiative. The Green BRI Center is part of the International Institute for Green Finance (IIGF) of the Central University of Finance and Economics (CUFE) in Beijing.

https://chinadialogue.net/en/energy/chinas-no-new-coal-power-overseas-pledge-one...


EU challenges China’s Belt and Road with €300bn Global Gateway

(Business News East, Berlin, 2 December 2021) The European Commission on December 1 revealed details of the EU’s €300bn ($340bn) Global Gateway Strategy, a global investment plan hailed as a "true alternative" to China's Belt and Road Initiative (BRI, or B&R). China has funded railways, roads and ports as BRI projects but it has come under fire from critics who say Beijing leaves some countries weighed down with loans they cannot hope to pay off. A centre-piece of Chinese foreign policy, BRI is accused of spreading “debt-trap diplomacy”. Critics of Global Gateway say in many ways it amounts to a repackaging of cash. As China pushes back against claims of "debt-trap diplomacy", the European Commission thinks it can sell Global Gateway as a "trusted brand".

https://www.bne.eu/eu-challenges-china-s-belt-and-road-with-300bn-global-gateway...


Iranian & Russian ECAs ink agreement to facilitate trade

(Tehran Times, Tehran, 10 September 2022) The Export Guarantee Fund of Iran (EGFI) has signed an agreement with the Russian Agency for Export Credit and Investment Insurance (EXIAR) with the aim of facilitating exports and providing the necessary guarantees for the development of trade between the two countries. According to Peyman-Pak of Iran's Trade Promotion Organization,, the agreement is signed with the aim of helping the traders of the two countries to use export insurance as an alternative to letters of credit (LC) and to reduce the risk of trade between the two countries. Emphasizing that the agreement has no credit limit and the signatories can issue guarantees up to one billion dollars, Peyman-Pak said: “This achievement has been made in line with the efforts of Trade Promotion Organization and Export Guarantee Fund of Iran to facilitate trade between the two countries of Iran and Russia.” It is not know if this agreement could include cover for Iran's alledged sale of military drones to Russia.

https://www.tehrantimes.com/news/476576/EGFI-inks-agreement-with-Russia-s-EXIAR-...


India has $5 bn new export opportunity in Russia

(Fortune India, Gurugram, 15 September 2022) With Europe maintaining trade sanctions on Russia, India has the potential to export $5 billion worth of goods to Russia in the next 12 months, A Shakhtivel, President, Federation of Indian Export Organisations (FIEO) has said. The export demand is high and supplies can start as soon as the rupee payment mechanism gets operationalised, he added. Russia now accounts for 18% of India’s crude imports; up from 1%  The ongoing Russia-Ukraine conflict may open up a $22.5 billion worth export opportunity across 83 commodities for India, says an analysis carried out by MVIRDC World Trade Centre, Mumbai.

https://www.fortuneindia.com/macro/india-has-5-bn-new-export-opportunity-in-russ...


US exports face empty container pile-up as supply chains recover

(Global Trade Review, London, 21 September 2022) Analysts are warning that ports in North America could become overwhelmed by a build-up of empty containers, as trans-Pacific supply chains and transportation times gradually return to pre-pandemic levels. The average time taken to deliver cargo soared to 112 days in February this year, nearly three times the average before Covid-19 struck, according to Denmark-based research and analysis firm Sea-Intelligence. As of late August, the most recent point for which data is available, that figure had dropped to 88 days.

https://www.gtreview.com/news/americas/us-ports-face-empty-container-pile-up-as-...


The role of ECAs in financing the transition to net zero

(Global Policy Journal, Durham, 23 September 2022) There is no net-zero world without a sustainable trading system, and trade finance is estimated to contribute to between 80–90% of all world trade. The first steps toward green ECAs have been taken, with the agreement announced at COP26 to end export credit support of unabated coal-fired power plants and the first net zero commitments to be made by [some] leading ECAs. In the coming months, there is an opportunity for the broader ECA community to step into the net zero-fold and work with private finance, policy makers, scientists, and civil society to accelerate an orderly and just transition to a net zero global economy. Our world depends on it. [Read the full 6 page report here. However, climate scientists warned in 2021 that the concept of net zero is a dangerous trap, noting that  “Net zero” is the point at which any residual emissions of greenhouse gases are balanced by technologies removing them from the atmosphere. This is a great idea, in principle. Unfortunately, in practice it helps perpetuate a belief in technological salvation and diminishes the sense of urgency surrounding the need to curb emissions now.]

https://www.globalpolicyjournal.com/articles/world-economy-trade-and-finance/rol...


TFG partners with UKEF and DIT to create a trade and export finance guide

(Trade Finance Global, London, 6 September 2022) Trade Finance Global (TFG) has partnered with UK Export Finance (UKEF), the UK government’s export credit agency, and Department for International Trade (DIT) to produce the UK Trade & Export Finance Guide. The 60-page guide comes against a backdrop of complex geopolitical circumstances and an ever-changing financial landscape. Exploring recent issues, such as the COVID-19 pandemic, Brexit, and the current Russia-Ukraine conflict, this guide aims to paint a clearer picture of how to navigate the current economic status of the industry.

https://www.tradefinanceglobal.com/posts/tfg-partners-with-ukef-and-dit-to-creat...


Chilean firm to receive Korean ECA $100 million fund for stable Australian lithium supply to South Korean firms

(Aju Business Daily, Seoul, 7 September 2022) Korea Eximbank, an official export credit agency in South Korea, will provide a fund of $100 million to SQM, a Chilean supplier of plant nutrients, iodine, lithium and industrial chemicals, to help ensure a stable supply of lithium for domestic battery and cathode material makers. The fund including $55 million in loans and $45 million in guarantees will be used to invest in SQM's development of lithium mines in Australia and the renovation and expansion of production facilities. SQM, one of the world’s biggest lithium producers, should supply lithium worth about $470 million to South Korean companies for 10 years.

https://www.ajudaily.com/view/20220907165152475


What's New August 2022

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.

  • Ukraine agent claims OECD ECAs complicit in Russian war crimes
  • UK Treasury backs £3bn UKEF finance package for war-torn Ukraine
  • UK unveils critical minerals strategy and UKEF role
  • Iran expected to ink agreement with Russian ECA soon
  • Ukranian ECA supports US$5.6 million in exports
  • Equator Principles Association Issues Due Diligence Guidance Note
  • Berne Union releases latest Business Confidence Survey
  • Korean battery maker secures $2B loan from 3 ECAS
  • Nigeria,  Sun Africa ink US $1.5bn EXIM supported deal for electrification
  • IsDB and ICIEC offer $10.5bn package to ease global food crisis
  • TNG receives AU$200M K-Sure conditional debt facility for Mt Peake mine
  • Ugandan Banks seek to establish Shs1 trillion export credit facility

Ukraine agent claims OECD ECAs complicit in Russian war crimes

(Bloomberg, London, 23 August 2022) Through their little-known trade finance agencies, Germany, Italy and France have been among the biggest backers of Russian oil, gas and petrochemical development in the last several years, helping to enrich and insulate the country as it prepared to invade Ukraine. Since Russia’s annexation of Crimea in 2014 through late 2021, German, Italian and French export-credit agencies guaranteed almost $13 billion in financing for projects in Russia, according to exclusive data compiled by the Global Strategic Communications Council, a nonprofit, worldwide network of climate experts. German and Italian state-owned banks lent a further $425 million. Many of the projects that received funding have ties to sanctioned individuals, including Leonid Mikhelson, Russia’s second-richest person, and Gennady Timchenko, a close associate of Vladimir Putin. Germany and Italy arranged $4 billion in guarantees tied to Russia’s largest natural-gas processing plant, run by Gazprom PJSC, which was sanctioned in February. The five institutions — Euler Hermes, SACE, Bpifrance Assurance Export, KfW-IPEX Bank and Cassa Depositi e Prestititi — told Bloomberg they stopped new cover for or loans to Russian projects after the invasion of Ukraine, and said they were in compliance with applicable sanctions. Many export-credit agencies operate without much public scrutiny. They typically provide credit guarantees, loans and insurance to domestic companies doing business in riskier parts of the world. French, Italian and German firms probably would have stayed out of Russia over the past decade without that backing, said Marcos Alvarez, head of insurance for global financial institutions at DBRS Morningstar, a credit-ratings agency. “These public finance institutions have made their governments complicit in Putin’s war crimes, filling Russia’s war chest and helping the Kremlin secure new export routes for its blood oil and gas,” Oleg Ustenko, Ukraine’s chief economic adviser said.

https://www.bloomberg.com/news/articles/2022-08-23/germany-france-italy-backed-r...


UK Treasury backs £3bn UKEF finance package for war-torn Ukraine

(Sky News, London, 3 August 2022) The UKEF credit facilities comprise up to £2.3bn for the financing of military contracts identified by the Ukrainian government, with the remaining £700m earmarked for reconstruction projects. Insiders speculated that companies such as BAE Systems and Babcock International were likely to be among those signing individual contracts with UKEF. Chancellor Nadhim Zahawi's backing for the deal is contingent upon the resolution of legal questions relating to "the compatibility of these facilities with our international subsidy control obligations". "Clearly Ukraine is a high-risk market in which to operate commercially, and we must acknowledge the risk of losses is significant," he wrote. "UKEF must also therefore continue to mitigate against Exchequer losses as far as is reasonably possible." The chancellor added that all individual contracts would also require Treasury approval. In March, International Trade Secretary Anne-Marie Trevelyan wrote to Louis Taylor, UKEF chief executive, instructing the agency to maintain its £3.5bn "market limit" for the country. Although the £3bn support is modest in the context of Ukraine's military and reconstruction needs, it underlines Britain's central role in providing internationally support to the country. A source close to UKEF said it had so far provided £23m in financial guarantees to Ukraine, including support for a commercial shipment of COVID-19 tests to the country's Ministry of Health before the Russian invasion. The Treasury and UKEF both declined to comment on the new credit facilities. The Council of the European Union, which represents the bloc's 27 individual member states, has agreed to send €1 billion ($1 billion) in financial aid to Ukraine as Russia's invasion intensifies. On August 28, Josep Borrell, Vice-President of the European Commission, noted that the E.U. has financed the delivery of military support to Ukraine to enable Ukraine to fight back, providing humanitarian support and macro-financial assistance, to keep the Ukrainian state afloat. In total, € 9.5 billion have been mobilised by Team Europe so far, with up to €8 billion in additional macro-financial assistance in the pipeline. The Biden administration is set to announce it will give Ukraine an additional $3bn worth of arms on the country’s independence day. The US has so provided $10.6bn in military help for Ukraine since the Russian invasion. It is not known if the U.S. Exim has been involved in any of these arms deals. Reuters notes that, per Ukrinform, Sweden will provide another $46.75 million in military aid to Ukraine.

https://news.sky.com/story/treasury-backs-3bn-export-finance-package-for-war-tor...


UK unveils critical minerals strategy and UKEF role

(Global Compliance News, London, 7 August 2022) On 22 July 2022, the UK government published a policy paper entitled “Resilience for the future: The UK’s critical minerals strategy” (UKCMS). The UKCMS outlines how the UK will secure critical mineral supply chains to ensure the energy transition. It also sets out the UK state support for domestic production of critical minerals as well as enabling the supply from third-party nations. Global transition to energy systems powered by clean energy technologies is one of the biggest transformational changes that the world is undergoing right now and is driving demand for minerals that are vital in the manufacturing of such technologies. A significant amount of state support and private investment into the critical minerals sector is required to match the demand with the supply. State support will focus on enabling the supply from third-party nations by making funding or other types of support available, with export credit agencies playing a key role. UKCMS also highlights the importance of the UKEF for funding critical minerals and expressly states that UKEF products can support eligible critical mineral projects, including UK-based projects with potential to export or overseas projects that present opportunities for export of UK goods and services.

https://www.globalcompliancenews.com/2022/08/07/united-kingdom-the-government-un...


Iran expected to ink agreement with Russian ECA soon

(Tehran Times, Tehran, 26 August 2022) The Head of Iran’s Trade Promotion Organization (TPO) has urged Russia to take the necessary measures for signing an agreement between Export Guarantee Fund of Iran and the Russian Agency for Export Credit and Investment Insurance (EXIAR) in the coming weeks. He also announced Iran's readiness to establish banking relations with Eximbank of Russia and emphasized that Iran is ready to use all the banking capacities of the two countries in order to facilitate the financial transactions between the two sides in a meeting with Director-General of Russian Export Center Veronika Nikishina in Moscow. Nikishina for her part welcomed the Iranian side’s proposals, saying: “We gladly join the actions and decisions that are being made because we want to create acceptable conditions for expanding business in a competitive financial environment.”  Meanwhile, the Washington Post reported on August 29 that Russian cargo planes quietly picked up the first of scores of Iranian-made combat drones for use against Ukraine, in a move that underscores deepening ties between Moscow and Tehran while also highlighting Russia’s struggles to supply its overstretched military. The Financial Tribune of Iran reported on August 30 that a 125-strong business delegation from Russia made up of representatives of 78 companies are scheduled to visit Tehran from Sept. 19-21 to meet their Iranian counterparts and survey ways of expanding bilateral cooperation.

https://www.tehrantimes.com/news/476060/Iran-expected-to-ink-agreement-with-Russ...


Ukranian ECA supports US$5.6 million in exports

(CableFree TV, London, 25 August 2022) Under a special program for loans to exporters, banks have provided 14 loans for an amount of 33.2 million UAH.(US$895,000) supported by the Export Credit Agency of Ukraine. Another 12 agreements worth US$1.47 M are awaiting signature. The ECA’s partner banks have supported the issuance of an additional 8 loans under simplified collateral requirements under a special exporter loan program under martial law. It is noted that entrepreneurs from the regions of Ivano-Frankivsk, Rivne, Kiev, Odessa, Dnepropetrovsk, Zaporozhye and Chernivtsi have received loans. They export paper bags, wooden products, solid fuel boilers, parquet boards, furniture parts, furniture, rubber products and foodstuffs. According to the ECA, the export contracts received for the implementation of: loansthe total amount of supported exports will exceed US$5,5 M. As reported, in March the Verkhovna Rada generally passed a law to ensure a large-scale expansion of the export of goods (works, services) of Ukrainian origin through insurance, guarantees and cheaper loans. The document provides for ensuring the effective functioning of the export credit institution.

https://cablefreetv.org/banks-have-already-lent-to-ukrainian-exporters-for-33-mi...


Equator Principles Association Issues Due Diligence Guidance Note

(JD Supra, Sausalito, 23 August 2022) In July 2022, the Equator Principles Association published a Guidance Note on how to apply the latest iteration of the Equator Principles (EP), EP4, during the Environmental and Social Due Diligence (ESDD) process. The Guidance Note is significant because it addresses the changes to the pre-financial close ESDD required to be undertaken by Independent Environmental and Social Consultants (IESCs) under EP4, including with respect to projects located in Designated Countries that are no longer “deemed in compliance” with the Equator Principles solely by virtue of satisfying host country law. The E&S standards applied by export credit agencies (ECAs) and development finance institutions (DFI) do not generally distinguish between Designated Countries and Non-Designated Countries. As such, if ECAs or DFIs are involved in the financing of a project, then the scope of the IESC’s ESDD should be the same regardless of whether the project is located in a Designated Country or a Non-Designated Country.

https://www.jdsupra.com/legalnews/equator-principles-association-issues-5428665/


Berne Union releases latest Business Confidence Survey

(Trade Finance Global, London, 26 August 2022) The Berne Union released its latest Business Confidence Survey this week amid mounting geopolitical uncertainty. This latest rendition of the quarterly report shows that demand for export credit insurance is growing. This phenomenon appears to stem from heightened geopolitical risk around the world and the overall bleak economic outlook. Paul Heaney, Acting Secretary General at Berne Union, said, “Right now, geopolitical risk is pushing up demand, while the fragile economic environment ultimately means more expensive finance and less underlying trade and investment activity.”

https://www.tradefinanceglobal.com/wire/berne-union-releases-latest-business-con...


Korean battery maker secures $2B loan from 3 ECAS

(Reuters, Seoul 19 August 2022) South Korea's SK On battery maker has raised about 2 trillion won ($1.51 billion) from private equity firms, pushing the electric vehicle (EV) battery maker's valuation to around 20 trillion won as it works to expand production abroad, local media reported on Thursday. The battery unit of energy group SK Innovation Co Ltd (096770.KS) has been in talks with a local private equity consortium the Korea Economic Daily Newspaper said, citing unidentified investment banking sources. Last month, SK On secured a $2 billion loan from three export credit agencies to finance its factory in Hungary. In other news, Hyundai Mobis announced on Aug. 22 that Hyundai Motor Group (HMG) and LG Energy Solution have secured US$710 million to finance the construction of a battery cell joint venture plant in Indonesia. Hyundai Motor Co., Kia Corp., Hyundai Mobis and LG Energy Solution provided debt guarantees according to their stake, and the Korea Trade Insurance Corp., a state-run export credit institution, provided credit guarantees.

https://www.reuters.com/technology/skorean-ev-battery-maker-sk-raises-15-bln-exp...


Nigeria, Sun Africa ink US $1.5bn EXIM supported deal for electrification

(Pumps Africa, Nairobi, 16 August 2022) The government of Nigeria and Sun Africa have inked a deal to reduce the gap in access to electricity between the country’s urban and rural areas through the extension of the national electricity grid in underserved states. The two are set to partner and install solar energy production systems in a dozen localities poorly served by the national electricity network. As part of this energy policy, the authorities of this West African country have obtained a loan of US $1.5bn from the American export credit agency Exim Bank. With a gross domestic product (GDP) of 432.3 billion dollars in 2020 according to the World Bank, Nigeria, as the largest economy in Africa, has an electricity access rate of 60%, of which only 34% is in rural areas. 85 million people do not have access to electricity.

https://pumps-africa.com/nigeria-sun-africa-ink-us-1-5bn-deal-for-electrificatio...


IsDB and ICIEC offer $10.5bn package to ease global food crisis

(Trade Arabia, Jeddah, 30 July 2022) The Islamic Development Bank (IsDB) Group has endorsed a $10.54 billion comprehensive Food Security Response Program (FSRP) package that will support member countries in addressing the ongoing food crisis. The package was approved during an extraordinary joint meeting of the IsDB Board of Executive Directors, the Board of Directors of the Islamic Solidarity Fund for Development (ISFD), and the Board of Directors of the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC). The primary focus of the programme and the bulk of the financing envelope of the remaining $7.3 billion, which will span over the next three years, will be on developing innovative medium- and long-term interventions to address structural weaknesses and root causes of food insecurity in the member states. These include low productivity, rural poverty, climate change, and weak resilience of regional and national agricultural and food systems through six (6) key initiatives: (i) building agricultural resilience to climate change; (ii) food and input value-chains; (iii) smallholders' productivity and market access; (iv) rural livelihood support; (v) livestock and fisheries development; and (vi) building resilient food supply systems. The total IsDB Group's financing support for agriculture and food security currently stands at $20.6 billion, comprising 1,538 operations.

http://www.tradearabia.com/news/BANK_399096.html


TNG receives AU$200M K-Sure conditional debt facility for Mt Peake mine

(Kalkine Media, Sidney, 9 August 2022) One of the leading Australian resource and mineral processing technology companies, TNG Limited (ASX:TNG) has secured a major cornerstone component of the multi-source, global funding package for its Mount Peake Vanadium-Titanium-Iron Project in the Northern Territory. In the latest development, TNG has received a conditional debt funding of AU$200 million (US$138 M) from the Korea Trade Insurance Corporation (K-Sure), which is the official export credit agency of South Korea under the Ministry of Trade, Industry and Energy. This debt funding is for TNG’s flagship Mount Peake Project, as per the terms of a conditional Letter of Support.

https://kalkinemedia.com/au/stocks/metal-and-mining/tng-receives-au200m-conditio...


Ugandan Banks seek to establish Shs1 trillion export credit facility

(East Africa Monitor, Kampala, 29 July 2022) Banks are in advanced stages of launching a Shs1 trillion export credit facility to support manufacturers involved in export within East Africa. The move, which is being championed by Uganda Bankers Association (UBA), seeks to finance manufacturers increase Ugandan products in regional markets. The export credit facility seeks to plug existing gaps, facilitate production and provide funding to power the entrepreneurial ecosystem through fostering growth and harnessing attendant trickle down benefits.

https://www.monitor.co.ug/uganda/business/markets/banks-seek-to-establish-shs1-t...


What's New July 2022

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.

  • IISD: Why ECAs must shift from fossil fuel support to clean energy
  • CSOs condemn G7 for caving in to gas industry - weakening pledge to end finance for fossil fuels
  • G-7 rolls out answer to China's Belt and Road initiative
  • EXIM plans aggressive marketing push and steady market growth
  • China's Sinosure registers steady business growth
  • EDC Plans 15% cut in fossil fuel portfolio by 2020
  • Belgian ECA restricts oil and gas finance but leaves gas loopholes
  • SK On Secures US$2bn in loan guarantees from 3 ECAs to Invest in Europe
  • EXIM Board approves Cameroon and Brazil Projects
  • OECD export credit rule changes could have long-term consequences for insurers
  • UK Export Finance provided £7.4 billion in support for UK exports last year
  • SACE supports Brazilian steelmaker CSN
  • French ECA cooperation agreements
  • Taiwan's Formosa 2 offshore wind plant starts with broad international ECA support
  • French ECA role in Polish nuclear expansion
  • French ECA supports Côte d'Ivoire coastal road loan
  • Australian ECA to provide $300m for Mount Peake vanadium-titanium-iron project
  • Norwegian ECA to provide €400m in guarantees and loans toward €1.6bn Arctic battery gigafactory

IISD: Why ECAs must shift from fossil fuel support to clean energy

(IISD, Winnipeg, 30 June 2022) If countries signing on to the COP26 Statement on International Public Support for the Clean Energy Transition shifted their almost US$28 billion/year from fossil fuels to jump-start the energy transition they would more than double their international clean energy finance. All international public finance institutions have yet to substantially scale up their clean energy support to catalyze a globally just energy transition and support energy security in a time of crisis. If the export credit agencies, development finance institutions and government departments of governments signing on to the COP26 Statement on International Public Support for the Clean Energy Transition were to fully redirect their USD 28 billion a year in overseas public finance for oil and gas, they would more than double their international clean energy finance, from USD 18 billion a year to USD 46 billion. As noted in our June 2022 ECA Watch What's New, between 2018 and 2020, G7 countries provided US$100bn towards oil, gas and coal projects through their export credit agencies (ECAs) or development finance institutions – over four times their contribution towards clean energy. As noted in our June 2022 ECA Watch What's New, between 2018 and 2020, G7 countries provided US$100bn towards oil, gas and coal projects through their export credit agencies (ECAs) or development finance institutions – over four times their contribution towards clean energy.

https://www.iisd.org/articles/press-release/glasgow-statement-could-shift-annual...


CSOs condemn G7 for caving in to gas industry - weakening pledge to end finance for fossil fuels

(Oil Change International, Washington, 27 June 2022) German Chancellor Olaf Scholz and other G7 leaders watered down a commitment made in May by their energy, climate and environment ministers to end international public finance for fossil fuels by the end of this year, drawing a swift rebuke from climate and development campaigners. Six out of seven G7 members had already adopted a near-identical commitment to shift public finance at the 2021 UN climate conference. The ministerial commitment was notable for adding Japan as Japan is the 2nd largest provider of international public finance for fossil fuels, pouring $11 billion into dirty overseas fossil fuel projects each year. The G7 leaders’ statement adds new loopholes to the commitment and says that “with a view to accelerating the phase out of our dependency on Russian energy … investment in [LNG] is necessary” and that “publicly supported investment in the gas sector can be appropriate as a temporary response”. Soon after the G7 ministerials, signals already emerged of countries backsliding on their commitment. Japan claimed it could continue financing upstream oil and gas projects despite the G7 pledge, and Germany’s Chancellor Scholz stated that Germany wants to “intensively” pursue gas projects in Senegal.

https://priceofoil.org/2022/06/28/csos-condemn-g7-leaders-for-caving-in-to-gas-i...


G-7 rolls out answer to China's Belt and Road initiative

(Politico, Washington, 27 June 2022) Biden and other G-7 leaders meeting in Germany on Sunday pledged to provide $600 billion in public and private financing for developing country infrastructure projects over the next five years, in a move aimed at countering China’s growing global economic clout. The United States will “mobilize” $200 billion of the public and private capital for the Partnership for Global Infrastructure (PGII), the G-7’s answer to China’s multitrillion-dollar Belt-and-Road infrastructure initiative that Beijing launched back in 2013. It is not clear what portion of the US $200bn support will come from EXIM.

https://www.politico.com/newsletters/weekly-trade/2022/06/27/g-7-promises-600-bi...


EXIM plans aggressive marketing push and steady market growth

(Reuters, Washington, 7 July 2022) The U.S. Export-Import Bank plans "aggressive" measures to restore its standing in the business community and to bump up credit volumes running at roughly a quarter of their levels from 2014 before it was hobbled first by Congress and then a global pandemic. In that span, EXIM faded in the minds of customers and foreign governments - and many simply never got to know it. Export-Import Bank President Reta Jo Lewis told Reuters. Republicans in Congress in July 2015 sought to permanently shutter EXIM, charging it was providing "corporate welfare" through cheap export financing for Boeing, General Electric, Caterpillar and other corporate giants. Its charter was restored after 4 months, but Republicans blocked EXIM board nominees for 4 more years, limiting it to loans of $10 million or less and shutting it out of the market for aircraft and major infrastructure projects. During the void, GE was among U.S. firms that turned elsewhere, agreeing in 2015 to move manufacturing of oilfield gas generator engines to Canada from Wisconsin, in a deal to access Canadian export financing. Meanwhile, China has continued to dwarf EXIM's efforts, providing $11 billion in official medium and long-term export credit in 2021, compared with $2.2 billion for the United States, according to EXIM's annual competitiveness report.

https://www.reuters.com/markets/us/us-exim-bank-chief-plans-aggressive-marketing...


China's Sinosure registers steady business growth

(Xinhua, Beijing, 28 July 2022) China's only policy-oriented insurer specializing in export credit insurance reported steady business growth in the first half of 2022. The China Export & Credit Insurance Corporation, also known as SINOSURE, had underwritten about 445.13 billion U.S. dollars worth of insured businesses during the period, up 11.8 percent year on year, according to the company. SINOSURE served nearly 164,000 clients in the first six months, a yearly increase of 15.2 percent, said the company. The company said it will make additional efforts to tide enterprises over difficulties and improve its digital services in the second half of the year, giving full play to its role in supporting exports and the Belt and Road Initiative.

https://english.news.cn/20220728/55ba832cdbee4985a861a04a01386f14/c.html


EDC Plans 15% cut in fossil fuel portfolio by 2020

(Bloomberg, Ottawa, 19 July 2022) Canada’s export credit agency is targeting a 15% cut to its financing portfolio for upstream oil and gas production by 2030. The target will include a 3% shift - against a 2020 baseline - in the composition of production to gas from oil, recognizing that the former may play a role in supporting energy demand during the transition to net-zero emissions. EDC, a government-backed lender, also wants a 37% reduction in emissions per passenger kilometer from its airlines portfolio by 2030. The new targets for two sectors that make up a sizable portion of the agency’s financing business are part of its broader push to achieve net zero by 2050. Meanwhile, UKEF claims to have spent “its first year without providing any support for overseas fossil fuel projects".

https://www.bloomberg.com/news/articles/2022-07-19/canada-export-bank-plans-15-c...


Belgian ECA restricts oil and gas finance but leaves gas loopholes

(Oil Change International, Washington, 15 July 2022) Today the Belgian export credit agency Credendo published a new policy to shift public finance out of fossil fuels and into clean energy. The policy is meant to implement a commitment that Belgium made alongside 33 other countries and 5 institutions at the United Nations climate conference in Glasgow last year. The group promised to end international public finance for fossil fuels by the end of 2022 and shift this money to clean energy. Though today’s new policy imposes additional restrictions on fossil fuel financing, it leaves loopholes for Credendo to continue financing new fossil fuel projects. According to the International Energy Agency, to maintain a 50% chance of limiting global heating to 1.5°C there can be no investments in new coal, oil or gas fields or Liquefied Natural Gas (LNG) infrastructure without stranded assets. Other research shows that on top of ending investments in new fossil fuel supply, 40% of already developed oil and gas reserves need to be left unextracted.

https://priceofoil.org/2022/07/15/belgian-export-credit-agency-restricts-oil-and...


SK On Secures US$2bn in loan guarantees from 3 ECAs to Invest in Europe

(Business Korea, Seoul, 29 July 2022) SK On, a battery business subsidiary of SK Innovation, has raised a total of US$2 billion for investment in Europe through official ECAS in Korea and Europe. The company plans to use the funds to finance the construction of its third European plant in Ivancsa, Hungary. The policy financial institutions that helped SK On to secure funds were Euler Hermes, a German trade insurance agency, Korea Trade Insurance Corp., and the Export-Import Bank of Korea. The three institutions provide guarantees or insurance for SK On in the process of getting loans from overseas banks. Germany’s Euler Hermes and Korea Trade Insurance Corp. will provide insurance worth USUS$800 million and USUS$700 million, respectively. The Export-Import Bank of Korea will offer a US$200 million guarantee. In addition, the Export-Import Bank of Korea will directly lend US$300 million to SK On.

https://www.businesskorea.co.kr/news/articleView.html?idxno=97556


EXIM Board approves Cameroon and Brazil Projects

(Global Trading Magazine, Dallas, 14 July 2022) The Export-Import Bank of the United States (EXIM) Board of Directors yesterday unanimously approved two transactions that will support U.S. exports to Cameroon and Brazil. Together, the two projects total more than $279 million, $74m for construction equipment in Cameroon and related goods and a guarantee for a $205.5 million loan from Citibank to Embraer S.A. in Brazil to support the export of U.S. manufactured aircraft engines and related components. Utilizing the production facilities of three U.S. exporters, General Electric, Honeywell and Pratt & Whitney, the transaction is expected to support approximately 1,200 U.S. jobs across the aerospace supply chain in North Carolina, Ohio, Arizona and Alabama. Since 1992, EXIM has generated more than $9 billion for the U.S. Treasury for repayment of overall U.S. debt.

https://www.globaltrademag.com/exim-board-of-directors-approves-final-commitment...


OECD export credit rule changes could have long-term consequences for insurers

(InsuranceDay, London, 4 July 2022) On November 5 2021, the OECD announced the minimum down payment requirement for the Arrangement would be cut from 15% to 5% for sovereign borrowers in developing markets.The change, which was implemented temporaryily for 12 months, stoked private market concerns that the impact on insurers could be longer term. Under the previous arrangement, official ECAs could only participate on the buyer credit portion of a given transaction, with a stipulation that the down payment portion (typically 15% of the value of the contract) should be provided by the private market. Normally, commercial banks that supply the loans for the down payment often then turn to the credit and political risk insurance market to cover the risk of default. The OECD has said this change is in response to a “clear market failure” caused by the ongoing Covid-19 crisis. In its view, the private sector was “very reluctant or even unwilling” to provide insurance cover for OECD Category II (low- and middle-income) countries, which in turn meant banks were unwilling to finance projects in these developing countries.

https://insuranceday.maritimeintelligence.informa.com/ID1141083/OECD-export-cred...


UK Export Finance provided £7.4 billion in support for UK exports last year

(Yorkshire Post, Leeds, 30 June 2022) British businesses received £7.4bn of Government support last year to help them secure export opportunities in 61 countries, according to the latest report from UK Export Finance (UKEF). The report concluded that finance provided by UKEF in 2021-22 supported 72,000 UK jobs and added a gross value of £4.3bn to the economy. Of those supported by UKEF, 83% were located outside of London and a record 81% were small and medium-sized enterprises, according to the organisation’s annual results. A spokesman said: “The £7.4bn – the highest level for 14 years – brings the total support over the last five years to £33.4bn. While proclaiming “its first year without providing any support for overseas fossil fuel projects", UKEF continued to promote a stalled US$1.5 billion LNG project in Mozambique following its 2020 backing of the project. As noted in our June 2022 ECA Watch What's New, between 2018 and 2020, G7 countries provided US$100bn towards oil, gas and coal projects through their export credit agencies (ECAs) or development finance institutions – over four times their contribution towards clean energy.

https://www.yorkshirepost.co.uk/business/uk-export-finance-provided-ps74-billion...


SACE supports Brazilian steelmaker CSN

(BNAmericas, Santiago, 12 July 2022) Brazilian steelmaker CSN has secured a credit facility worth US$375mn with Italian export credit agency SACE as part of the expansion plan for mining arm CSN Mineração. The funds will be used to buy equipment from Italian firms. The credit facility involves a pool of banks led by BNP Paribas, with Crédit Agricole, Natixis Corporate & Investment Banking and Société Générale Milan Branch. The credit facility involves a pool of banks led by BNP Paribas, with Crédit Agricole, Natixis Corporate & Investment Banking and Société Générale Milan Branch.

https://www.bnamericas.com/en/news/brazils-csn-obtains-us375mn-credit-facility-t...


French ECA cooperation agreements

(BPIFrance, Paris) This Bpifrance web page explains how national ECAs can cooperate to support projects involving exports from several countries, thus enhancing official ECA "subsidies" for corporate exporters. "Bpifrance Assurance Export interacts regularly with foreign export credit agencies at General Meetings and seminars of the Bern Union or at bilateral meetings, in the interest of exchanging and sharing best practices and expanding cooperation. With the internationalisation of production systems and increasingly frequent use of foreign sub contractors and providers, a single project can involve exports from several countries. For that reason, export support agencies have developed several forms of cooperation (joint insurance, co insurance, reinsurance) aimed at serving French exporters involved in a given project or contract in a third country. Thus, when certain contracts include a significant foreign content that make them ineligible for State support, insurance can be obtained through one of these mechanisms. Bpifrance Assurance Export has signed framework agreements with the majority of its peers. Where it does not already have a framework agreement with a given partner, a cooperation agreement may be entered into on a special purpose basis. Reinsurance is the most common form of cooperation used today.

https://www.bpifrance.com/products/export-credit-cooperation/


Taiwan's Formosa 2 offshore wind plant starts with broad international ECA support

(Project Finance International, London, 23 July 2022) The 367MW Formosa 2 offshore wind plant has achieved the first delivery of power to the Taiwanese grid, following the installation of 12 turbines. It will have 47 turbines when completed. The international lenders were BNP Paribas, Credit Agricole, Societe Generale, Natixis, ING, DBS, OCBC, MUFG, SMBC, ANZ Bank and HSBC alongside domestic banks CTBC, E Sun, Fubon Bank and KGI Bank, and institutional lender Taiwan Life Insurance. The export credit agencies are Credendo of Belgium, EKF of Denmark, K-Sure, and UKEF. The project, referred to as Haineng Fengdian, is off the island’s Miaoli County and is being developed by Japan’s JERA (49%), Macquarie’s Green Investment Group (GIG, 26%), and Taiwanese company Swancor Renewable Energy (25%).

https://www.pfie.com/story/3450973/taiwan-formosa-2-gets-first-power-p7jhy3g2mr


French ECA role in Polish nuclear expansion

(R and R Life, Manchester, 3 July 2022) Following French/Polish agreement in October 2021 to build 4 to 6 nucelear reactors, the French government has clearly stated its willingness to consider different ways to provide support, which is expected by the Polish side. Electricite de France (EDF) and the French government are open to discussions with the Polish government about who and what type of funding will be provided. EFF VP V. Ramany pointed out that France has a number of institutions that support such programs. "In debt financing, we have strong export credit insurance. This in turn helps in attracting banks to borrow for such projects. With regard to debt, we have, for example, the Public Development Bank SFIL, which can refinance debt at a relatively low cost." Poland generates most of its electricity from coal and was the only European Union member nation not to commit to climate neutrality by 2050 when the bloc set the target in 2019. But under rising pressure from the EU and with carbon emission costs surging, Warsaw is encouraging more investment in low emission sources.

https://www.randrlife.co.uk/announcement-by-the-edf-and-the-french-government-on...


French ECA supports Côte d'Ivoire coastal road loan

(Construction Index, 29 July 2022) Standard Chartered has announced €104 million (£88 million) of social loan financing for the Republic of Côte d'Ivoire’s Ministry of Economy and Finance, to rehabilitate a critical transport route in the south of the West African country. The money will go towards upgrading a stretch of the coastal road connecting the country’s two main port cities, Abidjan and San Pedro, as well as improving a 93km section of road between the towns of Dabou and Grand Lahou. The financing is backed by the French export credit agency Bpifrance Assurance Export. The financing package has been structured by Standard Chartered in its roles as global coordinator and structuring bank, social loan coordinator, bookrunner and mandated lead arranger.

https://www.theconstructionindex.co.uk/news/view/cte-divoire-gets-road-improveme...


Australian ECA to provide $300m for Mount Peake vanadium-titanium-iron project

(Australia Mining, Canberra, 11 July 2022) The Australian Government’s export credit agency has given a conditional Letter of Support for the provision of up to $300 million of debt funding for the construction of TNG’s flagship Mount Peake vanadium-titanium-iron project in the Northern Territory. Export Finance Australia is administering the Australian Government’s $2 billion Critical Minerals Facility, which has been established to assist in funding critical minerals projects. Mount Peake is one of 15 Australian critical minerals projects identified by the Australian Government in its Resources Technology and Critical Minerals Processing: National Manufacturing Priority Road Map.

https://www.australianmining.com.au/news/300-million-support-for-nt-critical-min...


Norwegian ECA to provide €400m in guarantees and loans toward €1.6bn Arctic battery gigafactory

(Global Construction, London, 1 July 2022) Norwegian battery-maker Freyr expects the plant to be one of the biggest and most efficient in Europe, with 50% lower capital spending per GWh of capacity and more than 200% higher production per employee than conventional lithium-ion facilities. The Giga Arctic project, which will be Freyr’s first, was announced on Wednesday by Jan Christian Vestre, Norway’s minister for trade and industry.

https://www.globalconstructionreview.com/battery-firm-to-build-e1-6bn-gigafactor...


What's New June 2022

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!

Japanese Civil Society welcomes halt of Bangladesh & Indonesian coal projects and Russian LNG project

(JACSES, Tokyo, 22 June 2022) It has been reported that the Ministry of Foreign Affairs announced to halt Official Development Assistance (ODA) to the Matarbari 2 in Bangladesh and the Indramayu coal-fired power project in Indonesia. Both projects have been strongly criticized internationally with repeated calls for the suspension of support, as they not only exacerbate the climate crisis, but also have a huge impact on the livelihoods of local people. However, in Bangladesh, construction of the Matarbari 1 coal-fired projects which has already been supported by Japan International Cooperation Agency (JICA), has caused unemployment of many local people who made their livelihoods by salt pans and farming shrimp. And delays in compensation payments and alternative housing have made their lives more difficult. There has also been unauthorized reclamation of riverbed due to dumping sediments which was associated with the construction of an access road. These sites and structures were also planned to be used in Matarbari 2. As noted Japan is one of the world’s largest financiers of oil, gas and coal. In addition Japanese ECA JBIC has suspended funding for Russian gas producer Novatek’s major Arctic LNG project, adding yet further strain to a development that has been hard hit by western sanctions.

http://jacses.org/en/353/


G7 ministers pledge end to fossil fuel finance amid signs of backsliding on commitments

(Global Trade Review, London, 1 June 2022) Following talks in Berlin on May 27, G7 climate, energy and environment ministers issued a communique in which they promised to halt new public finance for the unabated fossil fuel sector by the end of the year, except in “limited circumstances clearly defined by each country that are consistent with a 1.5 degrees Celsius warming limit”. All G7 nations bar Japan – one of the world’s largest financiers of oil, gas and coal – made a near identical pledge at the Cop26 climate summit in Glasgow in November. [Japan however did join this recent G7 statement.] Data from Oil Change International show G7 countries have upped their exposure to fossil fuels since 2017, despite growing climate concerns. Between 2018 and 2020, they provided US$100bn towards oil, gas and coal projects through export credit agencies (ECAs) or development finance institutions – over four times their contribution towards clean energy. Western ECAs have broadly moved to cut their exposure to fossil fuels, with members of the OECD Arrangement on Officially Supported Export Credits formally banning support for unabated coal-fired power projects in late 2021, despite reported pushback from certain countries, including Japan and Australia, to the proposal.

https://www.gtreview.com/news/sustainability/g7-ministers-pledge-end-to-fossil-f...


UKEF named best sustainable finance ECA despite continued review of Mozambique LNG

UK Export Finance (UKEF), was named the world’s best for sustainable finance at the TXF Global Export Finance Conference in Lisbon on Tuesday.June 7 despite its continued promotion of a $1.5 billion LNG project in Mozambique.UKEF claims to allocate £3.6 billion to "sustainable" projects, or 49% of its £7.4 billion 2021/22 expenditures, defining them as clean energy, healthcare and critical infrastructure projects. Critical infrastructure however included £1.1 billion for Turkey's 500 km electric railway, a lower-carbon alternative to current air and road travel, but hardly a "green" investment.Last autumn, Global Trade Review reported the government’s own inquiry into aid provided by the agency, which revealed that nearly 90% of the £12.3bn of support it committed in 2020/21 went to just nine companies. In terms of geographical spread, 92% of UKEF’s support in 2020/21 went to just 10 countries, with Qatar, Egypt and Mozambique together receiving nearly two-thirds of the total.

https://www.export.org.uk/news/608017/UK-Export-Finance-named-worlds-best-export...


Kuwait's state oil company seeks JIBC insurance for $1 billion

(Reuters, Kuwait, 7 June 2022) The state-owned Kuwait Petroleum Corporation is seeking to borrow up to $1 billion from banks including HSBC and JPMorgan, according to a parliamentary document reviewed by Reuters. The Kuwait Petroleum Corporation is currently negotiating with the Japanese export credit agency JIBC to provide insurance cover for the financing that the corporation will obtain from a group of international banks, including HSBC and JPMorgan, with a value not exceeding $1 billion for a period of 13 years, The financing will be used for capital expenditure, including on oil and gas production.

https://www.reuters.com/markets/commodities/kuwaits-state-oil-company-seeks-borr...


European Temporary Short Term Export Credit Aid Extended to Year End

(Lexology, London, 31 May 2022) On 19 March 2020, the European Commission adopted the Temporary Framework on State aid measures to support the economy in the current context of the COVID-19 outbreak. This included, amongst other forms of aid such as grants, advances, tax concessions, loans, etc., aid in the form of short-term export credit insurance... In just over two years after the Temporary Framework's entry into force, the Commission will have enabled Member States to provide rapid and flexible support to companies affected by the COVID-19 crisis. The Commission has in fact adopted more than 1,300 decisions in the context of the coronavirus pandemic, authorising almost 950 national measures for a total amount of State aid estimated at almost EUR 3,200 billion.

https://www.lexology.com/library/detail.aspx?g=7e1af497-1475-4200-8515-4d290de54...


Lexology's overview of ECAs

An interesting overview of official export credit agencies and activites. In 2020, the 10 largest MLT export credit volumes were from the ECAs for China (US$18 billion), France (US$12.1 billion), Germany (US$8.6 billion), Italy (US$8.4 billion), South Korea (US$5 billion), Sweden (US$4.7 billion), the United Kingdom (US$3.4 billion), Denmark (US$2.8 billion), Belgium (US$2.5 billion) and India (US$2.3 billion). [However],it should be noted that US EXIM, due to domestic debate on its role, was not able to authorise financings larger than US$10 million between 2015 and 2019. However, it is now reauthorised and can be anticipated to have increasing volumes in coming years. For example, in 2012, its total was approximately US$36 billion, whereas in 2021 its total was approximately US$1.8 billion. While down from 2020, this is reflective of the fact that, in 2020, US EXIM agreed to provide US$4.7 billion for the Mozambique liquefied natural gas (LNG) project alone.Loking at medium and long-term (i.e., over two years) (MLT) export credit volumes, which are most relevant to project financings, Atradius DSB on behalf of the Netherlands in 2020 provided US$1.9 billion of support, whereas Turkey provided only US$1.6 million of support, despite Turkey having a larger gross domestic product (GDP) than the Netherlands.

https://www.lexology.com/library/detail.aspx?g=3ca6a91f-8a98-4703-97c6-3771d89a6...


US EXIM renews supply chain finance for Boeing

(Global Trade Review, London, 1 June 2022) The Export-Import Bank of the United States (US Exim) has bolstered its support for the domestic aviation manufacturing industry, renewing a US$450mn supply chain finance (SCF) guarantee backing sales to Boeing. Under US Exim’s SCF programme, the government agency granted a 90% guarantee for a US$500mn facility from Citi, allowing the bank to finance payments

https://www.gtreview.com/news/americas/citi-boeing-renew-scf-agreement-with-us-e...


EU Export Credit Sanctions on Russia

On 3 June 2022 the EU adopted its sixth package of sanctions against Russia and Belarus. These prohibit the purchase, import or transfer of crude oil and certain petroleum products from Russia into the EU, as well as insuring and financing the transport, in particular through maritime routes, of Russian oil to third countries. Prohibitions include import or export advances and all types of insurance and reinsurance, including export credit insurance.

https://www.mondaq.com/russianfederation/export-controls-trade-investment-sancti...


Afreximbank mobilises $35b for African development and national ECAs

(Vanguard, Lagos, 15 June 2022) The African Export-Import Bank (Afreximbank) has mobilised a whopping $35 bilion for the development of the continent in the last 4-5 years, with significant support from Nigeria and Egypt. The Central Bank of Egypt has also partnered with Afreximbank to train several African bankers in many areas and Afreximbank was CBE's choice to advise on the creation of a national Export Credit Agency (ECA), as a result of which Afreximbank has now been mandated to do the same in other countries.

https://www.vanguardngr.com/2022/06/afreximbank-mobilises-35-b-for-african-devt-...


ECAs fill in SME trade finance support under Covid supply chain disruption

(Fintech & Finance News, Tunbridge Wells, 1 June 2022) Lack of trade finance for SMEs threatened to bring supply chains to a halt in 2020. SMEs play a critical role in trade – responsible for between 20 and 40 per cent of exports from OECD countries. When it comes to affordable trade finance, they face the biggest barriers, with more than half of trade finance requests by SMEs rejected, compared with seven per cent of multinational corporations’, according to the WTO. The OECD, reflecting on the experience of SMEs in the international supply chain during 2020, said short-term trade finance in all its forms (intra-firm financing, inter-firm financing, or more dedicated tools such as letters of credit, advance payment guarantees, performance bonds, and export credit insurance or guarantees) was critically hard to come by – but not because the cost to banks of providing that liquidity had increased. That forced SMEs to fall back on government agencies to stay in business: the Export-Import Bank of the United States, one of the largest providers of short-term government export support, for example, reported a 112 per cent increase in working capital guarantees and a 12 per cent increase in short-term export credit insurance during 2020. According to an OECD survey, 64 per cent of export credit agencies took measures that year to increase working capital support because private liquidity simply wasn’t forthcoming.

https://ffnews.com/newsarticle/exclusive-chain-reaction-martin-mccann-trade-ledg...


German export credit for emergency export of Ukranian grain

(Mass News, 13 June 2022) The German government is working to expedite the export of Ukrainian grain by rail, with plans being considered to establish a special fund to pay for the project. To facilitate the creation of a “grain bridge” Berlin is mulling setting up a special fund to purchase wagons as well as providing an export credit guarantee to carriers. Additional assistance could be provided to transfer terminals at the Ukrainian border because the country’s railway network uses a broader gauge than neighboring nations. German officials believe up to 10 million tons of grain could be transported out of Ukraine by rail. Ukraine has lost access to most of its ports after Russian forces took control of several regions in the south of Ukraine.

https://www.massnews.com/germany-has-plan-to-help-prevent-global-famine/


Danish ECA EKF to back French offshore wind project

KfW IPEX-Bank, together with Crédit Agricole CIB, Banco Santander, S.A., Mizuho Bank, European Investment Bank (EIB), and the Danish Export Credit Agency (EKF), has decided to finance the 30 MW Eoliennes Flottantes du Golfe du Lion (EFGL) floating wind project offshore France. “Fixed offshore wind farms can only be operated economically up to a certain sea depth. Floating wind farms will open up deeper waters. This gives us the opportunity to expand offshore wind power much more and drive the decarbonisation of energy generation faster worldwide”, said Dr Velibor Marjanovic, member of the Management Board of KfW IPEX-Bank. The project, which is one of the world’s first commercially financed floating offshore wind farms, is located in the Mediterranean Sea, more than 16 kilometres offshore from Leucate, Aude, and Le Barcarès, Pyrénées-Orientales. It is scheduled to be commissioned at the end of 2023 and will operate for 20 years.

https://www.offshorewind.biz/2022/06/08/floating-offshore-wind-project-attracts-...


Russian war on Ukraine triggers conflict over ECAs and African oil

(ECA Watch, Ottawa, 30 June 2022) Sanctions on Russian fossil fuel exports have generated conflict over ECA support for African fossil fuel development. Existing ECA African projects include, for example, UKEF's reluctance to end discussion of Mozambique's LNG project, JIBC's talks with Kuweit's state oil company and innumerable others. The Inter Governmental Panel on Climate Change report called out commercial banks and export credit agencies for the role they are still playing in financing fossil fuel investments. Adding to this pressure, Mary Robinson, ex-UN climate envoy, now says Africa's need for energy is so great it should be able to widely exploit its fossil fuel deposits.  Some back the idea that African gas can be exploited while the EU and developed countries find green alternatives. Others see an African dash for gas as a potential disaster. Nnimmo Bassey and Anabela Lemos state that “far from generating prosperity and stability in sub-Saharan Africa, investments in fossil fuels cause real harm,” noting “Decades of fossil fuel development have failed to deliver energy to much of the continent and have built economic models dependent on extraction that have deepened inequality, caused environmental damage, stoked corruption, and encouraged political repression.”




What's New May 2022

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.

  • Italy's SACE joins major banks to reject finance for Total's EACOP
  • Korean court dismisses indigenous challenge to Australian ECA gas project financing
  • UN High Commissioner for Human Rights urges ECAs to strengthen standards
  • UK Green Trade and "de-Putinizing" the world economy
  • Berne Union reports uncertain trade credit insurance bounce back
  • 122 CSOs warn there is only six months left to meet joint COP26 commitments
  • Boeing Reports Increased Stability and Growth for Aircraft Finance Sector
  • Spanish ECA's US$1.3 billion loan to PetroPeru pushes delayed audit
  • State aid: EU Commission approves Danish short-term export credit scheme
  • Etihad Credit to play a role in UAE's move away from oil
  • EDC launches program to guarantee bank loans to companies in carbon intensive sectors
  • 70% of Indian exporters’ payments stuck in Russia have come in
  • Dutch government offers export credit insurance to new Manila airport
  • NEXIM promotes Nigerian Non-oil Exports for Fiscal Sustainability

Italy's SACE joins major banks to reject finance for Total's EACOP

(Banktrack, Nijmegen, 20 May 2022) The coalition to #StopEACOP celebrates this week’s news that five banks including Deutsche Bank, Citi, JPMorgan Chase, Wells Fargo and Morgan Stanley have confirmed they will not join the project loan to finance the East African Crude Oil Pipeline (EACOP). They are joined by the insurer Beazley Group and the Italian export credit agency SACE. This takes the number of banks that want nothing to do with the EACOP project loan to 20 and the number of insurers to eight. The list of banks rejecting the project includes seven of Total’s ten largest lenders. However Eacop's executives from the Ugandan government and oil companies remained confident that the financing package for the project will be tied up in two months.

https://mailchi.mp/banktrack/seven-financiers-abandon-totalenergies-eacop-pipeli...


Korean court dismisses indigenous challenge to Australian ECA gas project financing

(Global Trade Review, London, 25 May 2022) A South Korean court has dismissed an application by traditional owners in Australia for an injunction to prevent South Korean public finance institutions from supporting a proposed gas export project. Representatives of the Tiwi Islander and Larrakia indigenous peoples in northern Australia launched legal proceedings in March to stop the South Korea Export-Import Bank (Kexim) and export credit insurer K-Sure from extending A$964mn (US$725mn) in financing and insurance to the Barossa gas project. But this week Seoul’s Central District Court threw out the application,

https://www.gtreview.com/news/asia/south-korea-dismisses-challenge-to-australian...


UN High Commissioner for Human Rights urges ECAs to strengthen standards

(UN Human Rights Office, Geneva, 6 May 2022) Michelle Bachelet, UN High Commissioner for Human Rights, recommends how to improve human rights impacts of global supply chains, as requested by the German Presidency of the G7. She noted that achieving sustainable supply chains will also require integration of international standards on responsible business conduct across investment and trade policy. Export credit agencies and export-import banks for example are key players involved in supporting parts of global supply chain operations. Yet their lack of multilateral engagement in recent years has had a negative impact on their capacity to update and align their standards either to the UNGPs or to high-level commitments made by their own governments. Improving the human rights performance of export credit agencies is an important lever for fostering sustainable supply chains. As an obvious first step, governments should heighten the obligations of the Export Credit Group’s Recommendation on Common Approaches regarding human rights and international standards on responsible business conduct. Accelerating efforts to advance implementation of the UN Guiding Principles on Business and Human Rights (UNGPs) in global supply chains is a crucial step forward to do this.

https://www.ohchr.org/en/statements/2022/05/g7-sustainable-value-chains-success-...


UK Green Trade and "de-Putinizing" the world economy

(Institute of Export and International Trade, London, 18 May 2022) UK International trade secretary Anne-Marie Trevelyan has said green trade is central to growing the UK’s economy, achieving net zero and driving prosperity, as well as “De-Putinising” the global economy by cutting reliance on Russian oil and gas. Trevelyan said the Ukraine conflict underlined the need to phase out imports of Russian oil and gas, adding “These past months have highlighted the need to accelerate our journey as a global community away from hydrocarbons. To decisively turn our backs on the era of dependence on polluting fuels, and transition to a net zero future.” The minister also announced two new ‘green’ deals for British exporters to be delivered by UKEF, a £138m loan guarantee for electric power manufacturer Megger and a £50m sustainability-linked loan to construction company Mace.

https://www.export.org.uk/news/605789/Green-trade-crucial-to-achieving-net-zero-...


Berne Union reports uncertain trade credit insurance bounce back

(Global Trade Review, London, 18 May 2022) A more stable trade environment helped generate US$117.7bn in new medium to long-term trade credit insurance business in the second half of 2021, according to freshly released data, although soaring inflation threatens to undercut the bounce back. A data snapshot released by the Berne Union, the export credit industry association, shows the medium to long-term sector beginning to rebound from the pandemic, with the US$117bn of new business representing growth of 13% compared to the same period in 2020, but still 12% down on pre-pandemic levels. Short-term trade credit insurance has also notched up continuous growth – rising 14% on the second half of 2019 and 12% on the second half of 2020 to US$2.45 trillion. In a statement released following its spring meetings in Istanbul, the Berne Union says that growth of 12% across all trade insurance types in the second half of 2021, compared to the same period in 2020, is “somewhat complicated” by the gradual rise in inflation last year, in addition to “fluctuating” exchange rates.

https://www.gtreview.com/news/global/despite-bounce-back-trade-credit-insurance-...


122 CSOs warn there is only six months left to meet joint COP26 commitments

(Oil Change International, Washington, 19 May 2022) Today, 122 civil society groups are releasing letters to eleven government signatories to the Glasgow Statement on International Public Support for the Clean Energy Transition, laying out the actions they must take as soon as possible to meet their commitment. In their joint statement at COP26, 35 countries and 5 public finance institutions committed to end their international public finance for ‘unabated’ fossil fuels by the end of 2022, and instead prioritise their “support fully towards the clean energy transition.” The Glasgow Statement has the potential to directly shift at least USD $24 billion a year in influential trade and development finance from governments away from oil, gas, and coal. The $24 billion per year quoted above is from the open-access Public Finance for Energy Database (energyfinance.org), a project of Oil Change International. ECAs are consistently the worst public finance actors for the climate, providing 11 times more support for fossil fuels than renewable energy in 2018-2020.

https://priceofoil.org/2022/05/19/122-csos-warn-signatory-countries/


Boeing Reports Increased Stability and Growth for Aircraft Finance Sector

(Yahoo Finance, 2 May 2022) Boeing has released their 2022 Commercial Aircraft Financing Market Outlook (CAFMO) showing improving financing stability as the industry recovers from the impacts of the global pandemic. For the second consecutive year, 100% of Boeing deliveries were financed by third parties, with the top sources of delivery funding coming from cash, capital markets and sale leasebacks. ECA supported financing for Boeing aircraft contributed about 5% of total funding last year, primarily by the Export-Import Bank of the United States and with one deal supported by UK Export Finance. The Boeing 2021 Commercial Market Outlook, a separate annual 20-year forecast addressing the market for commercial airplanes and services, projects that through 2040 there will be demand more than 43,500 new airplanes valued at $7.2 trillion.

https://www.yahoo.com/now/boeing-reports-increased-stability-growth-143000799.ht...


Spanish ECA's US$1.3 billion loan to PetroPeru pushes delayed audit

(Paris Beacon-News, Paris, 5 May 2022) Price Waterhouse Coopers (PWC) will carry out the external audit of the 2021 financial statements of the state company Petroperú in an effort to recover the confidence of creditors, bondholders, banks and risk rating agencies and hopefully allow negotiation of a request for consent from bondholders and the Spanish Export Credit News (CESCE) to reschedule presentation of last year’s financial statements. CESCE granted PetroPeru a loan of US$1,300 million in 2018 for the modernization of the Talara refinery and, a year earlier, Petroperú placed US$2,000 million in bonds in international debt markets to finance the same project, which has started performance tests last April. The recent PetroPeru crisis led debt rating agencies Standard & Poor’s and Fitch to reduce Petroperú’s credit rating due to a lack of financial transparency, exacerbated by the delay in having last year’s financial statements audited. Petroperu was downgraded earlier this month to junk by credit agencies after accounting firm PwC declined to audit the company's financial statements in the middle of a corporate governance crisis in which Petroperu's previous CEO Hugo Chavez resigned on amid allegations that he had improperly hired a company to provide him with personal security and people were saying audit firms did not feel comfortable enough to audit Petroperu while Chavez was in charge. On top of this, PetroPeru is demanding compensation of up to $34.5 million from the Spanish oil giant Repsol after freak waves from a volcanic eruption near Tonga caused an oil spill described as the worst ecological disaster to hit Peru in recent history, claiming that Repsol's Pampilla refinery “apparently” did not have a contingency plan for an oil spill.

https://www.parisbeacon.com/94670/


State aid: EU Commission approves Danish short-term export credit scheme

(European Commission, Brussels, 4 May 2022) The European Commission has approved, under EU State aid rules, the reintroduction of a Danish short-term export credit scheme. Under the scheme, the Danish State can cover risks of single export transactions. The scheme was originally approved in April 2013, prolonged in December 2015 and expired in December 2020. In February 2022, Denmark notified its intention to reintroduce the scheme, which will run until 31 December 2025. The Commission found that the measure is necessary, as there is a lack of private insurers covering single export transactions (i.e. insurance provided on a transaction-by-transaction basis rather than on the entire export portfolio of a company)

https://ec.europa.eu/commission/presscorner/detail/en/mex_22_2804


Etihad Credit to play a role in UAE's move away from oil

(Gulf Today, Dubai, 15 May 2022) Massimo Falcioni, CEO of Etihad Credit Insurance (ECI), the official export support agency of the United Arab Emirates (UAE), welcomed Sheikh Mohamed Bin Zayed Al Nahyan’s election as the Crown Prince of Abu Dhabi and his role in steering the UAE economy towards independence from oil. In this process, Greek and Turkish ECAs have recently signed cooperation agreements with Etihad Credit. Greece, keen to attract investment from the UAE, has agreed to create a €4 billion ($4.22bn) initiative to invest in the Greek economy during a visit by Greek premier Kyriakos Mitsotakis to Abu Dhabi on May 9th. Last year, the countries’ official export credit agencies signed an agreement to boost bilateral trade. In 2020, the two states inked a foreign policy and defense cooperation deal. A cooperation agreement has also been signed between Türk Eximbank and ECI The signing of the deal occurred amid the 2022 spring meeting in Istanbul of the International Association of Export Credits and Investment Insurers, also known as Berne Union, of which Türk Eximbank became a member in 1994. The said agreement aims to provide co-financing for projects involved in the export of goods and services in both countries, as well as sharing information between institutions.

https://www.gulftoday.ae/business/2022/05/15/new-era-to-propel-uae-to-greater-he...


EDC launches program to guarantee bank loans to companies in carbon intensive sectors

(Globe & Mail, Toronto, 2 May 2022) Export Development Canada has agreed to partly guarantee $1-billion of loans which the Bank of Montreal plans to make to companies in carbon-intensive industries in order to help them lower their emissions, reducing the risks of the bank’s foray into funding an urgent but uncertain energy transition. The three-year guarantee agreement will provide financing for medium-to-large-sized Canadian companies, rather than the largest corporate entities, which have easier access to capital. EDC will guarantee up to half of BMO’s term loans to a maximum of US$60-million per borrower for up to seven years. It is an early result of a federal effort to help reduce the risks of funding investments in early-stage technologies that could be crucial to cutting greenhouse-gas emissions, such as carbon capture or hydrogen fuel.

https://www.theglobeandmail.com/business/article-edc-launches-program-with-bank-...


70% of Indian exporters’ payments stuck in Russia have come in

(Live Mint, India, 5 May 2022) As much as 70–80% of the payments for goods that were shipped to Russia before the Ukraine war have been coming in, a government official privy to the matter told Mint, comforting exporters. Exporters had claimed that about $500 million in payments were stuck after the war began in February. Stuck dues had become a pain point for Indian exporters, especially after Russia was cut off from the SWIFT payment gateway. In FY21 India’s exports to Russia stood at $2.6 billion, while imports were $5.5 billion. A number of exporters told Mint that those shipping goods to Russia were not being uniformly given insurance cover, which is provided by the state-owned Export Credit Guarantee Corporation, compounding their problems.

https://www.livemint.com/news/india/70-of-exporters-payments-stuck-in-russia-hav...


Dutch government offers export credit insurance to new Manila airport

(Business Mirror, Makati City, 25 May 2022) SAN Miguel Corp. on Wednesday said it received support for the P740-billion (US$14 billion) new Manila International Airport (NMIA) project in Bulacan following the approval of the Dutch government, represented by Atradius Dutch State Business (DSB) of export credit insurance to Royal Boskalis Westminster N.V., to cover its 1.5-billion euro contract for land development works at the airport project site in Bulakan, Bulacan. The approval comes after more than a year of “rigorous” review of the project’s long-term environmental and social impact mitigation measures to ensure that the multi-billion project is done with sustainability in mind and aligned with the country’s climate ambitions. It is the largest export credit agency insurance policy granted in the 90-year history of Atradius. The airport project will feature four parallel runways, a terminal and an interlinked infrastructure network that includes expressways and railways.

https://businessmirror.com.ph/2022/05/25/dutch-government-offers-export-credit-i...


NEXIM promotes Nigerian Non-oil Exports for Fiscal Sustainability

(This Day, Lagos, 8 May 2022) Amidst the present administration’s current efforts aimed at diversifying the base of the Nigerian economy from the perils of oil, the need to provide adequate funding and attention to the non-oil export sector cannot be over-emphasised. Analysts have contended that most of the economic challenges bedeviling the country could simply be addressed by boosting local production and strengthening its non-oil export potential. Abba Bello, Head of the Nigerian Export-Import Bank (NEXIM), notes that its Export Development Fund (EDF) had led to the processing of 442 Applications worth N461 billion and $43.69 million, out of which N214.65 billion had been approved while N153.03 billion had been disbursed to 101 beneficiaries, as well as approvals totaling N55.85 billion which were undergoing the pre-disbursement process. Bello said so far, $492.97 million and €1.17 million, translating into N196.32 billion, have been received as export proceeds from projects that have repatriated their income, while others are yet to complete the transaction circle, adding that many of the institutions supported by the bank now feature on the list of top 100 exporters published annually by the Central Bank of Nigeria (CBN). NEXIM Bank is further taking steps to position Nigerian exporters to benefit from the unfolding opportunities offered by AfCFTA (African Continental Free Trade Agreement), following the recent exit of Britain from the European Union and the prospects in other regions. The bank is therefore taking measures to increase its funding capacity towards boosting lending support thereby increasing foreign exchange earnings for the country and facilitating employment generation.

https://www.thisdaylive.com/index.php/2022/05/08/promoting-non-oil-exports-for-f...


What's New April 2022

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.

  • UN Secretary General: Some governments & business leaders say one thing but do another. Simply put they're lying.
  • Greenwashing won't cut it: Canada risks disaster by barely mentioning financial sector in climate plan
  • Indigenous Australians Derail Controversial Barossa Gas Project by Suing South Korean ECA
  • Oil Change International launches database to expose the institutions using our money to fund fossils
  • UKEF hands billions to projects linked to labour abuse and climate damage
  • UKEF faces further legal action over Mozambique LNG project
  • LNG Exports Seen Benefiting From EXIM Financing
  • The 900-Mile EACOP East Africa Crude Oil Pipeline Is a Bad Deal for My Country — and the World
  • Global Trade Review Editorial: Encouraging yet disheartening
  • U.S. EXIM Bank formalizes Russia pullout; approves Sri Lanka, Albania, Iraq deals
  • Sinosure scales up financial support for green industries
  • Swedish ECA studying new import guarantee fund
  • Aeroflot negotiating purchase of 8 ECA financed Airbus aircraft

UN Secretary General: Some governments & business leaders say one thing but do another. Simply put they're lying.

(Brisbane Times, Brisbane, 11 April 2022) The Intergovernmental Panel on Climate Change’s Sixth Assessment Report, with its direct language and whole chapter on finance, should be a wake-up call to those in the business community who are avoiding taking genuine action on climate change. United Nations Secretary General Antonio Guterres didn’t mince his words when he introduced the report to the world, bluntly stating that investing in “new fossil fuel infrastructure is moral and economic madness.”  The report calls out commercial banks and export credit agencies for the role they are still playing in financing fossil fuel investments. He notes that "Some government and business leaders are saying one thing – but doing another. Simply put, they are lying."

https://www.brisbanetimes.com.au/environment/climate-change/simply-put-they-are-...


Greenwashing won't cut it: Canada risks disaster by barely mentioning financial sector in climate plan

(National Observer, Vancouver, 6 April 2022) Canada’s recently published emissions reduction plan provides a roadmap for how Ottawa plans to hit its 2030 climate targets, but critics say until the financial sector is aligned with climate goals, the government's plans are “derelict.” Environmental Defence’s climate finance manager Julie Segal says Canada appears excited about the benefits of sustainable finance but doesn’t appreciate the risks from continued fossil fuel investments. First, there's the systemic risk from climate change and how the financial sector and financial regulators approach that, and then there's the piece about how the financial sector is contributing to climate change through investments,” she said. “And Canada is being derelict on those accounts.” The 271-page emissions reduction plan contains [only] 4 pages dedicated to “sustainable finance” that outline at a high level a few of the federal government’s initiatives. However, Segal says the brief attention to financial issues in the plan, when compared to the detail offered for other sectors, shows Ottawa isn’t grasping the importance of the file. “Part of the reason they're not getting it is because the Sustainable Finance Action Council — all of the work on sustainable finance — is very much led by industry,” she said. “The federal government hasn't thought about finance and climate properly. They just haven't really understood what's going on here,” said Adam Scott, director of Shift Action for Pension Wealth and Planet Health. Greenwashing won’t cut it because real emissions reductions are needed to protect the economy at large from ever-worsening natural disasters and the economic impacts of climate change. Page 5 of a recent Oil Change International report shows that Canada leads the world in its public finance support for fossil fuel investments.

https://www.nationalobserver.com/2022/04/06/news/government-risks-disaster-barel...


Indigenous Australians Derail Controversial Barossa Gas Project by Suing South Korean ECA

(VICE, Brooklyn, 6 April 2022) The South Korean government has shelved plans to pour $700 million into a massive $4.7 billion gas project in Australia’s Timor Sea far north offshore after Tiwi Island Indigenous leaders from the region took them to court, according to government meeting notes seen by VICE. The Export-Import Bank of Korea pulled the handbrake on part of a mammoth $US700 million investment into the controversial Barossa gas project in Australia’s Northern Territory last month. “Not only is the Barossa gas project more polluting than other existing gas fields, but it also faces business uncertainty with its incomplete carbon capture and storage scheme, and plummeting long-term liquified natural gas demand,” said Hye-Young, South Korean National Assembly representative. ABC Australia reports that South Korea's K-SURE and Japan's JBIC have approved their financing, so the project's financing hinges on KEXIM. Larrakia and Tiwi Islander traditional owners, along with an international coalition of anti-gas groups, are targeting plans for a $4.7 billion Barossa gas development, to be built and operated by Santos, in waters about 300 kilometres north of Darwin. Conversation Canada has noted that this Tiwi Islands offshore gas fight shows public banks are under real pressure over fossil fuel funding. They note that Public financial institutions are under renewed pressure to change lending practices after the world’s leading climate scientists strongly warned against any new fossil fuel infrastructure. In our region, public banks in China, Japan, and South Korea now face unprecedented scrutiny for their role in financing the climate crisis. While export credit agencies are not the only funders of oil, gas and coal infrastructure, and not the largest either, they have been instrumental in developing many of the world’s most carbon intensive sectors. How? By locking in fossil fuel energy systems, leveraging private finance by reducing risk premiums, and shaping international standards which influence private bank policies. In short, they have played a key role in enabling fossil fuel expansion. For decades, these state supported agencies have gone under the radar. No longer. Scrutiny is increasing of their work borrowing from national treasuries or public capital markets to finance export-oriented fossil fuel projects.

https://www.vice.com/en/article/akv94k/indigenous-australians-have-derailed-a-co...


Oil Change International launches database to expose the institutions using our money to fund fossils

(Oil Change, Washington, 28 April 2022) Public finance institutions shape our future energy systems. They are uniquely positioned to catalyze a just, transformative, and rapid transition to clean energy and a livable future — if we can hold them accountable to their public-interest mandates. But the decade-plus of data Oil Change International has collected for the newly launched Public Finance for Energy Database (energyfinance.org) shows most influential international public finance institutions are failing to take the very first step: stop funding fossil fuels. The headline finding of our database is that G20 countries’ trade, export credit and development finance institutions and the major multilateral development banks (MDBs) provided at least $63 billion each year to coal, oil, and gas projects between 2018 and 2020. That is 2.5 more than the support for clean energy by the same institutions over the same period. In addition to this critique, the report notes that there is momentum growing to end public finance for fossil fuels and shift this to support a just energy transition, with 39 countries and institutions committing to do this by the end of 2022 under the Glasgow Statement at COP26.

https://priceofoil.org/2022/04/28/launched-public-finance-for-energy-database/


UKEF hands billions to projects linked to labour abuse and climate damage

(The Guardian, London, 31 March 2022) UK Export Finance used £5.24bn of taxpayer money to fund overseas energy and infrastructure ventures despite its own review raising concerns over labour abuses and environmental damage. Since 2019, UKEF has allocated £5.24bn of taxpayer money to projects with the potential to cause “significant adverse environmental and/or social impacts” in countries across the Middle East, Africa and Asia, according to calculations by the Guardian based on disclosures made by UKEF. Oil refineries, power stations, and a large-scale liquified natural gas (LGN) project are among the high-risk “Category A projects”, to receive funding recently. UKEF undertook environmental and human rights reviews of the projects ahead of granting the funding. Despite recommendations to mitigate labour abuses, six migrant workers employed on Middle Eastern projects backed by UKEF have revealed low pay, safety hazards, excessive working hours, and the denial of freedom of movement as persistent issues. Daniel Willis, policy and campaigns manager at Global Justice Now said that “Human rights considerations are an afterthought, and due diligence seems to be approached as if it is just a box to tick.” A review of an oil refinery upgrade programme in Kuwait, obtained by a freedom of information request, shows that UKEF knew of worker issues before it provided a $179m (£135m) support package in 2019. Employees and contractors were commonly working more than the maximum overtime hours allowed by legislation, and 87% of workers surveyed had not received an employment contract, according to the UKEF’s review. About 90% of workers at Kuwait National Petroleum Company (KNPC) had also been charged illicit recruitment fees to secure their jobs. Before awarding it $500m in 2019, a UKEF review flagged the Bahrain Petroleum Company (Bapco) oil refinery expansion project as having “forced and child labour and worker health and safety as potential project risks”.

https://www.theguardian.com/global-development/2022/mar/31/britain-hands-billion...


UKEF faces further legal action over Mozambique LNG project

(Global Trade Review, London, 20 April 2022) Friends of the Earth says it will continue its fight against UKEF's decision to provide US$1.15bn of support to a natural gas project in Mozambique, after a split judgement from two UK High Court judges. In a judgement handed down last month, Justice Stuart-Smith dismissed Friends of the Earth’s claim, ruling that UKEF’s assessment of the climate change impacts of the project was lawful. But the second judge hearing the case, Justice Thornton, found that UKEF had failed to take climate impacts properly into consideration and ministers who approved the financing package did not have access to enough information to make a decision. The project under development by Total includes two offshore gas fields and a liquefaction plant with capacity of some 13 million tonnes per year. UKEF is among eight other export credit agencies and 19 commercial banks financing the project, in what Total says is the largest project finance deal ever struck in Africa. When fully operational it is expected to significantly lift Mozambique’s contribution to greenhouse gas emissions, however its proponents say that it may lead to an overall shrinking of emissions because some buyers will use the exported gas to switch from fuel sources such as coal and oil. During the course of the judicial review, arguments focused on a climate change impact report produced by UKEF which was provided to ministers who had input into the funding decision. The report relied heavily on an assessment by energy consultants Wood Mackenzie and Wood Mackenzie acknowledged that the report had severe limitations due to the difficulty of knowing where and how the exported gas would be used. An internal UKEF email described the report as “very light and [it] makes high level assumptions”. Total suspended construction of the Mozambique project and evacuated workers after insurgent attacks in early 2021, delaying the expected start of production to 2025. The company’s chief executive Patrick Pouyanne told Reuters in February that the company plans to restart construction sometime this year.

https://www.gtreview.com/news/europe/ukef-faces-further-legal-action-over-mozamb...


LNG Exports Seen Benefiting From EXIM Financing

(Bloomberg, Washington, 13 April 2022) The U.S. Export-Import Bank approved a plan Thursday that could yield a flood of financing for U.S. energy ventures, including wind and solar projects, battery manufacturing and terminals to sell LNG overseas. The bank’s board voted 3-0 on a formal policy shift encouraged by the Biden administration that would extend support to domestic manufacturing and infrastructure projects that facilitate exports. The agency plans to prioritize financing for green projects, from renewable power ventures to clean energy manufacturing. The initiative would apply to non-energy ventures too, including the manufacture of semiconductors, biotech and biomedical gear. Environmentalists and natural gas advocates say the initiative could also bolster a host of LNG export terminals proposed from the U.S. Gulf Coast to Alaska, especially given the Biden administration’s efforts to supplant Russian energy in Europe with U.S. supplies. Shipments of U.S. natural gas have surged over the past few years. While advocacy groups for the U.S. LNG sector quickly welcomed the plan, saying it could help projects overcome funding challenges and support thousands of jobs, environmentalists expressed concern that new LNG financing could take money away from renewable energy. As the U.S. attempts to bring down the soaring price of energy, financing from a New Deal–era agency could be used to ramp up domestic gas production. It is planning those controversial investments with almost no opportunity for public review. Now, under pressure from LNG interests, Exim may double down on its investment in fracked gas through a domestic financing program President Biden has created to strengthen supply chains.

https://www.bloomberg.com/news/articles/2022-04-13/lng-projects-may-get-funding-...


The 900-Mile EACOP East Africa Crude Oil Pipeline Is a Bad Deal for My Country — and the World

(New York Times, Kampala, 8 April 2022) Vanessa Nakate, Ugandan climate justice activist, notes that this week, the panel of climate experts convened by the UN delivered a clear message: To stand a chance of curbing dangerous climate change, we can’t afford to build more fossil fuel infrastructure. We must also rapidly phase out the fossil fuels we’re using. In moments like this, the media rarely focuses on African countries like mine, Uganda. When it does, it covers the impacts — the devastation we are already experiencing and the catastrophes that loom. They are right to: Mozambique has been battered in recent years by cyclones intensified by climate change. Drought in Kenya linked to climate change has left millions hungry. In Uganda, we are now more frequently hit by extreme flash floods that destroy lives and livelihoods. Africa isn’t only a victim of the climate crisis, but also a place where infrastructure decisions made in the coming years will shape how it unfolds. TotalEnergies, a French energy company, this year announced a $10 billion investment decision, which involves a nearly 900-mile oil pipeline from Kabaale, Uganda, to a peninsula near Tanga, Tanzania. From there, the oil would be exported to the international market. Despite local opposition, TotalEnergies and a partner, the China National Offshore Oil Corporation, have pushed ahead. The project might have a difficult time securing additional financing, as many banks have already ruled out the project. The multinational insurance company Munich Re has also vowed not to insure it, at least in part because of the harm it would do to the climate. An estimated 14,000 households will lose land, according to Oxfam International, with thousands of people set to be economically or physically displaced. There are reports that compensation payments offered to some communities are completely insufficient. In other news, Ugandan NGOs have written to German and Italian ECAs asking them to not finance EACOP, noting that if constructed the pipeline will be the longest electrically heated crude oil pipeline in the world, will transport 216,000 barrels of crude oil per day at peak production, will displace over 86,000 people from 5,172 hectares of land in Uganda and Tanzania, affect nearly 2,000 sq.km of protected areas, a quarter of which are habitats for endangered species, threaten the livelihoods of hundreds of thousands of Lakes Albert and Victoria fishers in Uganda and the DRC and result in the production of over 34.3 million metric tonnes of carbon per year, roughly 7 times Ugana's annual emissions when the oil is burnt.

https://www.nytimes.com/2022/04/08/opinion/environment/east-africa-oil-pipeline....


Global Trade Review Editorial: Encouraging yet disheartening

(Global Trade Review, London, 11 April 2022) Momentum continues to build around environmental, social and governance efforts in trade and trade finance. Every week, we report on encouraging new developments, including a recent decision by the European Council that gives export credit agencies (ECAs) in the EU until the end of 2023 to set deadlines for ending support for fossil fuels; the formation of the Climate Working Group, a new initiative convened by the Berne Union bringing together ECAs and other insurers and financiers to accelerate climate action; as well as the much-anticipated launch of a pilot of a new ESG scoring tool for measuring country, supply chain and company activity against EU and UN sustainability goals. Other developments have been less heartening. The annual Banking on Climate Chaos report, a comprehensive global analysis on fossil fuel financing released as this publication goes to press, documents that in the six years since the adoption of the Paris Agreement, the world’s 60 largest private banks poured US$4.6 trillion [yes trillion] into fossil fuels. As much as US$742bn of support was provided in 2021 alone. The report, co-authored by NGOs including BankTrack, Sierra Club and Oil Change International, includes a timeline that lays out how banks that joined the Net-Zero Banking Alliance last year simultaneously financed “some of the most egregious oil and gas expansion companies”. In this publication, we take a closer look at these and other issues impacting on ESG and trade.

https://www.gtreview.com/magazine/esg-trade-issue-2022/from-the-editor-17/


U.S. EXIM Bank formalizes Russia pullout; approves Sri Lanka, Albania, Iraq deals

(Reuters, Washington, 31 March 2022) The U.S. EXIM's board of directors on Thursday voted to formalize the bank's withdrawal from any further business in Russia and approved financing and to guarantee deals worth up to $381 million for Iraq, Sri Lanka and Albania. The board also voted to notify Congress of a proposed renewal of a $450 million credit guarantee to Citibank that backs a $500 million facility to allow 365 suppliers of aircraft maker Boeing to receive accelerated receivables payments related to export sales of Boeing aircraft. The formal closing of Russian business follows an announcement last week by EXIM and export credit agencies in Britain and Canada to withdraw all support from Russia and Belarus in response to Russia's invasion of Ukraine. EXIM previously had an administrative hold prohibiting Russian business since Moscow's annexation of Crimea in 2014. EXIM still has $410 million in prior credit exposure to Russia, primarily for aviation sector loan guarantees that were granted before Crimea's annexation. Meanwhile, it’s not clear how many of the 500 or so foreign-owed planes stuck in Russia are potentially eligible for the exception, or which owners will be able to apply. Most of the aircraft are on operating leases vs fixed term rental contracts.

https://www.reuters.com/business/finance/us-exim-bank-formalizes-russia-pullout-...


Sinosure scales up financial support for green industries

(Xinhua, Beijing, 17 April 2022) China Export and Credit Insurance Corporation (Sinosure) says it has stepped up support for the country's green industries by providing more export credit insurance. Since the start of 2021, the company has insured over 150 green projects, with the sum insured reaching around 7.7 billion U.S. dollars.  Sinosure has also strengthened its financial support to green projects under the Belt and Road Initiative and helped domestic companies explore overseas green and low-carbon markets. Take the photovoltaic industry as an example. Sinosure has helped facilitate the export of photovoltaic products worth over 130 billion U.S. dollars from 286 companies since 2005. Looking to the future, Sinosure will continue to explore green finance innovation, promote the integration of green finance and green industries, increase support for green industries and green projects, and give better play to the role of export credit insurance, the company said.

https://www.bignewsnetwork.com/news/272488901/sinosure-scales-up-financial-suppo...


Swedish ECA studying new import guarantee fund

(Regeringen, Stockholm, 12 April 2022) Google translation. The Swedish Riksdag has proposed a budget amendment for 2022 that would authorize the government to issue guarantees of up to SEK 3 billion (US$305 million) for the purpose of insuring critical raw material imports for industry, to be administered by the Swedish Export Credit Agency (EKN). The new government guarantee is intended to support the green transition threatened by increased demand for critical raw materials and increases in raw material prices which have risen markedly since Russia's invasion of Ukraine. The raw material guarantee would fall under EKN's sustainability policy and hence EKN must take into account its guaranteeing of the environment, extraction of fossil fuels, human rights and working conditions, combating corruption and tax evasion and promoting sustainable lending to poor countries. As the credit guarantee is linked to the import of raw materials, unlike EKN's other range of export credit guarantees, a new regulation is required and a Proposal for a new regulation went out for consultation on 25 March.

https://www.regeringen.se/pressmeddelanden/2022/04/regeringen-foreslar-en-ravaru...


Aeroflot negotiating purchase of 8 ECA financed Airbus aircraft

(AssumeTech, Iceland, 21 April 2022) Aeroflot is considering the purchase of 8 chartered Airbus SE aircraft after the European Union provided a mechanism for lenders to dispose of some seized aircraft in Russia after the invasion of Ukraine, TASS reported. The planes operate under so-called finance leases, which the European Union created a penalty waiver this month by allowing payments from agreements signed before February 26. Financial leases refer in to new Airbus and Boeing aircraft, with export credit agencies guaranteeing approximately 85% of the amount lent to an airline by a banking association. Most of the approximately 500 foreign-owned aircraft blocked in Russia operate under operating leases in which airlines lease planes for a specified period and can return them to the owner after the contract has expired. Russia passed a law banning foreign-owned planes from leaving without state permission after the Ukrainian invasion imposed penalties on lessors for canceling contracts and trying to return their planes.

https://asumetech.com/russian-airlines-is-negotiating-for-the-purchase-of-8-airb...


What's New March 2022

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!

Export credits face Russia sanctions AND the Paris Agreement

(ECA Watch, Ottawa, 29 March 2022) As governments struggle to find fossil fuel supplies to offset dependence on imports from Russia, and transnational oil firms reap huge profits from higher oil prices and look for more through new projects and pipelines, and families around the world face not only higher gas prices to fill the family car or local buses but also higher food costs driven by dependence on fossil fuel dependent agriculture and manufacturing chains, Export Credit Agencies confront the big contradictions between pressures to not finance global warming and Western political expectations of livestyles and infrastructures dependent on fossil fuels. This month's What's New looks at ECA cuts to fossil fuel projects and ECA support for Russian projects and the war in Ukraine. Requests for ECA investments in Mozambique and East African pipelines face African demands instead for renewable energy projects and rejection of African complicity in looming global warming. For years ECA Watch has documented the billions of ECA investments in fossil fuels. One investment industry source estimates that the cumulative total volume of sustainable export finance deals in the five years to the end of 2021 was [only] $109 billion across 353 deals. They noted that about 20% of export finance deals ($28.6 Billion) through 2021 were classified as sustainable, i.e. 80%, or $143 billion, weren't. And on top of that, the European Securities and Marketing Authority (ESMA) has warned that the definition of sustainable export finance (for example measurement of CO2 emissions) can be subject to greenwashing. In fact one commercial research company in February removed 1,200 so called environment, social and governance (ESG) funds, with a combined $1.4 trillion in assets, from its European sustainable investment lists, after tightening its criteria on ESG tagging, as it believed those funds were not delivering on their stated ESG [Environmental, Social and (Corporate) Governance] goals. The slack monitoring of the "gentlemans' agreement" of the OECD "common approaches" definitions and environmental standards for official ECAs is well known, with the result that pressures are mounting for the Councel of the European Union to act to enforce ECA compliance with the Paris Agreement, since the OECD "disciplines have not been sufficiently modernized" and the OECD Arrangement is "not keeping up with the pace demanded by both changing economic and climate environments".




ECAs slam the door on Russia

(Global Trade Review, London, 9 March 2022) Export credit agencies and trade credit insurers have hurriedly axed coverage for Russia and Belarus as the deepening conflict and western sanctions interrupt trade and major projects. At least 10 ECAs have stopped or limited coverage for the two countries since late February, when Russian President Vladimir Putin launched an invasion of Ukraine. Many ECAs have also suspended coverage of Ukraine. ECA exposures to Russia range from the relatively modest A$3mn of Export Finance Australia to the substantial €1.7bn on the books of Austria’s OeKB. Other exposures disclosed to GTR or in annual reports include €1bn for Finnvera, Finland’s ECA; US$453mn for Sweden’s EKN; US$428mn for the US Export-Import Bank (US Exim); and €170mn for Poland’s Kuke. ECAs which may have significant exposures but did not respond to questions or publicly disclose exposures include those in France, Italy, Japan and Spain. UK Export Finance (UKEF) has £49.9mn in remaining exposure to buyers in Russia. UKEF declined to respond on the record but GTR understands the agency’s total exposure relating to Russia is just over £100mn.

https://www.gtreview.com/news/global/export-credit-agencies-and-trade-credit-ins...


European Council conclusions on official export credits

(European Council, Brussels, 15 March 2022) The Council's conclusion underlines that officially supported export credits are key levers in order to achieve priority policy goals for the European Union and its Member States. Such goals include the building of a strong industrial Europe, while ensuring the transition to low greenhouse gas emissions. Officially supported export credits are essential for Europe's global industrial competitiveness as they support European companies in competing for contracts and projects overseas, thereby providing jobs and growth, including for Small and Medium Enterprises, across EU Member States. Officially supported export credits originated by EU Member States are highly regulated, notably by the OECD Arrangement on Officially Supported Export Credits and EU Regulation No. 1233/201. They note that "these disciplines have not been sufficiently modernized, given the evolution of global value chains and the international competition from non-OECD countries". They further note "that even though there has been increased progress in the negotiations on the OECD Arrangement, they are still not keeping up with the pace demanded by both changing economic and climate environments". While acknowledging "the need to adapt export credit policies accordingly, in an effort to limit the global average temperature increase to 1.5 °C above pre-industrial levels", the Council conclusions focus on the goal of a "global level playing field and the modernisation of the OECD Arrangement" with a view to ensuring that "officially supported export credits are essential for Europe's global industrial competitiveness as they support European companies in competing for contracts and projects overseas". ECA Watch notes that this EU position on ending public support for fossil fuels fails to do exactly that. See our statement issued on March 15th.

https://www.consilium.europa.eu/en/press/press-releases/2022/03/15/the-council-a...


Berne Union Launches New Climate Working Group (CWG)

(Berne Union, London, 17 March 2022) The group leverages the Berne Union network to connect innovation in export credit with global problem-solving around climate challenges and sustainable development. The ultimate objective of the Climate Working Group is to accelerate climate action in the export credit, trade finance and political risk insurance industries by fostering innovation and promoting alignment around low-carbon transition. The CWG is chaired by EDC's Leah Gilbert Morris, and administrated by the Berne Union Secretariat. Institutions leading the work of the CWG include: AGENCE FRANÇAISE DE DÉVELOPPEMENT (AFD); AFRICAN TRADE INSURANCE AGENCY (ATI); AXA XL; BPIFRANCE; DZ BANK; EDC CANADA; EKN SWEDEN; INVESTEC; MIGA (WORLD BANK); UK EXPORT FINANCE; US DEVELOPMENT FINANCE CORPORATION. [It will be interesting to see whether this is just another greenwashing initiative. Some 1200 supposedly ESG compliant funds with a combined $1.4 trillion in assets were recently dropped by commercial research company Morningstar from its European sustainable investment ratings, which presumably follow EU Sustainable Finance Disclosure Regulations (SFDR). EDC's role as Chair of the CWG would seem compromised by EDC's portfolio, which provided more public finance for fossil fuels than any G20 country other than China between 2016 and 2018, with EDC providing on average $13.8 billion in support to oil and gas companies each year.]

https://www.berneunion.org/Articles/Details/661/Berne-Union-Launches-New-Climate...


EDC targets growing demand for ESG financing

(Globe & Mail, Toronto, 28 March 2022) Canada’s export credit agency is looking to capitalize on the growing trend for sustainable investing, launching a set of new financial tools aimed at supporting socially oriented businesses and helping large greenhouse gas emitters reduce their carbon footprint. Export Development Canada has issued green bonds since 2014, using the proceeds to invest in public transportation and renewable energy projects. [We have pointed out in other articles in this month's What's New that EDC provided more public finance for fossil fuels than any G20 country other than China, on average $13.8 billion in support to oil and gas companies each year between 2016 and 2018. So they have a long way to go to offset their fossil fuel vs sustainability imbalance.]

https://www.theglobeandmail.com/business/article-edc-targets-growing-demand-for-...


EDC backed loan to primarily Russian-owned Buhler Industries

(CBC, Winnipeg, 9 March 2022) In December 2020 Export Development Canada — a federal Crown credit corporation — signed a guarantee to back half of a $14-million loan to Winnipeg's 97% Russian owned Buhler Industries to support the company's ongoing operations. The manufacturer of farming equipment, including Versatile tractors, has been under scrutiny since Konstantin Babkin, who resigned as a Buhler director on March 2, made at least two public statements in support of Russia's invasion of Ukraine. Babkin leads the Action Party, a Russian political party that has supported Russian President Vladimir Putin. On Feb. 21, Babkin tweeted out the party's support of Putin's decision "to recognize the Donetsk and Luhansk People's Republics" in Ukraine. Buhler Industries has repeatedly denounced Russia's attack on Ukraine. Babkin's resignation did not impact his ownership stake in Buhler Industries, which is 97% owned by Combine Factory Rostselmash. That company is a subsidiary of Novoe Sodrugestvo CJSC, a Russian conglomerate co-owned by Babkin, current Buhler director Dmitry Udras and Buhler CEO Yury Ryazanov. EDC has not purrsued business related to Russian contracts or Russian borrowers since 2014, when Russia annexed the Crimean peninsula, Buhler Industries says pulling out of the loan could have a huge impact on Canadian workers, farm equipment dealers and farmers who count on the company for spare parts.

https://www.cbc.ca/news/canada/manitoba/export-development-buhler-loan-1.6373466


Indian Exporters Find Themselves Caught In Russia/Ukraine Crossfire

(Bloomberg Quint, New Delhi, 1 March 2022) Even before the harshest of sanctions ⁠hit, trouble had started to build for those in India doing business with Russia. On Friday evening, two days after Russia began attacking sites in Ukraine, Rakesh Shah, director at Nipha Exports in Kolkata, received an email from the Export Credit Guarantee Corporation of India stating that export credit guarantees for exports to Russia would now be approved only on a case-by-case basis and not as freely as it was before. This was done to account for the rising risk in the region, the government said in a release while clarifying that the cover has not been completely withdrawn. On Tuesday, Reuters reported that India's largest bank State Bank of India has stopped transactions with Russian entities under sanctions to avoid being in breach of them. Nipha Exports has €1,00,000 worth of material to be shipped to Russia and unfulfilled orders worth €3,00,000 up to May this year. With impediments to trade rising, how quickly it will be able to resume shipments and get payments is anybody’s guess.

https://www.bloombergquint.com/business/russia-ukraine-crisis-indian-exporters-f...


Korea Wins US Export Ban Exemption, Shores Up Exporters to Russia

(Asia Financial, London & Hong Kong, 4 March 2022) South Korea said on Friday that it had won an exemption from expanded US export restrictions imposed on Russia over its invasion of Ukraine, Seoul’s trade ministry said on Friday. The exemption means Korean companies won’t have to secure licences from Washington for exports using US technology before they can be shipped to Russia. The US rule, part of Washington’s sanctions on Moscow, was feared to affect major South Korean exporters, as they make heavy use of US technology and software. The move followed meetings between Yeo Han-koo, South Korea’s trade minister, and senior US officials in Washington on Thursday. Seoul unveiled a list of measures to help companies with export records to Russia or Ukraine in the previous year. They include export credit guarantees and short-term export insurance.

https://www.asiafinancial.com/korea-wins-us-ban-exemption-shores-up-exports-to-r...


Pressure on Japan's energy ties in Russia ratchets up with Shell's Sakhalin exit

(S&P Global, Tokyo, 1 March 2022) Pressure is mounting for Japanese companies to review their energy business connections with Russia in the wake of Shell's withdrawal from the Sakhalin 2 project, which accounts for close to 9% of Japan's LNG imports, industry sources said. Shell's Feb. 28 announcement that it was withdrawing from its partnerships with Russian energy giant Gazprom, including the Sakhalin 2 crude oil and LNG project in the Russian Far East, in response to Russia's invasion of Ukraine. Jogmec provides an equity financing and loan guarantee to Japan Arctic LNG, a subsidiary of Mitsui, which has a 10% stake in the Arctic LNG 2 project. NEXI provides export credit insurance and export credit guarantees for Japanese companies' energy businesses including LNG in Russia.

https://www.spglobal.com/commodity-insights/en/market-insights/latest-news/oil/0...


ECIC Growing Its Footprint In Ethiopia and the DRC

(Forbes Africa, Johannesburg, 4 March 2022) The Export Credit Insurance Corporation (ECIC) provides political and commercial risk insurance cover to South African exporters of goods and services and to cross border investors. Its strategic focus is on emerging markets in Africa and outside the continent that are considered too risky for conventional insurers. Ethiopia and the Democratic Republic of Congo (DRC) are amongst the largest economies in Africa and are therefore key markets for South African exporters and the ECIC.  The ongoing civil war, which started in November 2019, created a highly uncertain environment in Ethiopia. The recent release of opposition political party officials from prison by the central government is a significant step towards a resolution of the civil war. Investments into Ethiopia for which ECIC was involved include a US$12,5 million in a cement plant by South Africa’s Pretoria Portland Cement (PPC) and a USD121,5m by Vodacom South Africa in 2021. ECIC provided political risk insurance cover for both investments. The DRC is endowed with exceptional mineral resources including cobalt and copper, significant arable land, and huge hydropower potential. This continues to attract significant investment into the country making it the third largest recipient of foreign direct investment in Sub Saharan Africa. The ECIC supported projects in various sectors of DRC including mining, transport, food, and construction sectors. South Africa can supply capital, skills, machinery, and consumer goods to help the country reach its development potential.

https://www.forbesafrica.com/brand-voice/2022/03/04/the-african-insurance-compan...


SACE freezes loan for Russian Arctic LNG 2 plant

(Reuters, Rome, 1 March 2022) Russia's invasion of Ukraine has prompted Italy to put on hold its share of financing for the $21 billion Arctic LNG 2 project led by privately-owned Russian gas producer Novatek (NVTK.MM), two sources close to the matter told Reuters on Tuesday. Italian state lender Cassa Depositi e Prestiti (CDP) and the Russian arm of Italy's biggest bank Intesa Sanpaolo (ISP.MI) had agreed in recent weeks to help finance Novatek's project. The loan was set to be guaranteed by SACE, Italy's export credit agency, which has already insured nearly 5 billion euros worth of projects and investments relating to Russia. SACE also notes that it is temporarily suspending the evaluation and acceptance of new risks for export credit activities in Russia and in Belarus.

https://www.reuters.com/markets/europe/exclusive-italy-freezes-loan-russian-arct...


Judges split over UKEF funding of Mozambique gas project

(Drill or Drop, London, 15 March 2022) Two judges have disagreed in what could be a landmark case over whether the UK government acted lawfully in approving $1.15bn financing for a liquified natural gas (LNG) project in Mozambique. The case at the High Court, brought by Friends of the Earth, examined the decision to fund the scheme through the export credit agency, UK Export Finance (UKEF), approved by the Treasury and the Department for International Trade. The judges’ split decision means the judicial review has not yet succeeded and a court order is awaited with the final result. Friends of the Earth said today it was likely to appeal if the judicial review was refused. The case, which tested compliance with the Paris Agreement, centred on the failure to assess the project’s total climate impact by taking into account emissions produced from the end-use of the gas, known as scope 3. This is thought to be the first time a judge has argued that to be consistent with the Paris Agreement all finance flows must be shown to be in line with the international ambition to limit temperature rise to 1.5C.

https://drillordrop.com/2022/03/15/high-court-judges-split-over-government-decis...


Korean ECAs sued to stop deep-sea oil pipeline

(BBC, London, 23 March 2022) Tiwi Islands and Larrakia Traditional Owners in Australia’s Northern Territory and youth activists in South Korea have taken the South Korean government to court to stop it from financing Santos and SK E&S’ offshore deep sea Barossa gas project. The legal challenge could prevent the South Korean Government from lending some $AU964 million (US$722m) to the $4.7 billion Barossa gas project via its export credit agencies, the Export-Import Bank of Korea (KEXIM) and the Korea Trade Insurance Corporation (K-SURE), putting the financial viability of the entire project at risk. The Traditional Owners argue they have not been consulted about the project - which threatens their sea country and way of life - and therefore have not been given the opportunity to give their free, prior and informed consent for it to proceed. Plans for the gas project include a 300km-long pipeline to be built through their sea country, an area under their legal jurisdiction. Traditional Owners fear impacts to cultural sites, turtles and other marine life that are central to their culture and the local ecotourism industry. Energy giant Santos is pushing ahead with development for the major new gas field off the coast of Darwin, in what it says is the biggest investment in Australia's oil and gas industry in almost a decade.

https://www.bbc.com/news/business-60828912


What's New February 2022

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.

  • Paris Agreement alignment of EDC (NOT!)
  • Germany suspends Russian export credit guarantees
  • Indian exporters hold back shipments to CIS
  • Ukraine: TFX Trade Risk Briefing - What might be the impact of sanctions?
  • EXIM's first Black leader faces challenges on China, climate, equity
  • Total’s East African crude oil pipeline ‘struggling’ to find financiers
  • AfCFTA Secretariat, Afreximbank Seal Deal on $10bn Fund to Boost African Economies
  • AfreximBank Trade Centre Harare project to start soon
  • Sustainability in export finance – the push for change
  • Italy clears hurdle to buy SACE in $4.8 bln deal
  • Building a bank for entrepreneurs is crucial, says CEO of Bpifrance
  • Canada Bangladesh FTA negotiations with EDC role?
  • Africa's Fossil-fuel Investment Trap

Paris Agreement alignment of EDC (NOT!)

(Perspectives Climate Group, Freiburg, 15 February 2022) Perspectives Climate Group has launched a new 41 page report which finds that despite commitments made at and after COP26, Export Development Canada's activities are not aligned with the Paris Agreement's 1.5 degree objective. In total, the  exposure  of  EDC’s  portfolio to carbon-intensive activities stood at 26% – equalling a total exposure of about USD$16 billion – by the end of 2020.  Support for ‘cleantech’ activities, the Canadian label for climate- or sustainability-related activities, was small compared to fossil fuel-related support standing at about USD 2.33 billion per year. Total portfolio exposure is not reported for ‘cleantech’ and a definition of ‘cleantech’ based on a positive list of activities does not exist. Currently, negative emission technologies like carbon capture and storage (CCS) are eligible for the cleantech definition. While there are reasons to justify CCS in some cases, we deem it as misleading to classify them as ‘cleantech’ because they can lead to prolonging fossil fuel infrastructure lifetime and to spurring fossil fuel demand. EDC's  official  exclusion  policy  for  fossil  fuels  only  applies  to  thermal  coal, not mettalurgical coal, another high-carbon intensive and important Canadian export good. Limiting temperature increase to 1.5°C above pre-industrial levels requires massively re-directing financial flows away from carbon-intensive activities and towards low-carbon activities. However, despite commitments made under Article 2.1(c) of the Paris Agreement ... many countries still provide significant financial support to fossil fuel value chains, among others, through their export credit agencies (ECAs). Canada's National Observer notes that EDC needs to clean up its act on climate.

https://www.perspectives.cc/public/fileadmin/user_upload/ECA_Canada.pdf


Germany suspends Russian export credit guarantees

(Wall Street Journal, Berlin, 25 February 2022) Berlin has stopped the approval of export credit and investment guarantees for Russia, the Economy Ministry said. With the so-called Hermes cover credit export guarantees, the German government protects companies against the insolvency of foreign customers. Germany issued such guarantees for trade with Russia to the tune of 1.49 billion euros, equivalent to $1.67 billion, in 2021, the ministry said. The instrument has been in use since 1949. ECA Watch Italian member ReCommon has asked SACE to clarify its position given its EUR 4.3 billion exposure in Russia. Numberous other international sanctions have been imposed on Russa.

https://www.wsj.com/livecoverage/russia-ukraine-latest-news/card/germany-suspend...


Indian exporters hold back shipments to CIS

(Deccan Chronicle, Secunderabad, 28 February 2022) The Export Credit Guarantee Corporation (ECGC) [of India] has decided to withdraw coverage for shipments to Russia with effect from February 25. ECGC in a communication had said: "based on the near-term commercial outlook, it has been decided to modify the country risk classification of Russia under the short-term and medium-and-long term with effect from February 25." Indian exporters to Russia and CIS countries face uncertainty over goods worth $500 million due to the withdrawal of credit guarantee cover on items bound for the region, sanctions on Russian banks and feared disruptions at ports in the Baltic region.

https://www.deccanchronicle.com/business/market/280222/exporters-hold-back-shipm...


Ukraine: TFX Trade Risk Briefing - What might be the impact of sanctions?

(TFX News, London, 25 February 2022) In a 20 minute TFX video, Rebecca Harding, CEO of Coriolis Technologies discusses the practical impact of sanctions on commodity trade and oil and gas prices,  the shift surrounding Nord Stream 2, second the involvement of international payments mechanisms, specifically SWIFT in the fast-moving situation and third the potentials for rebalancing trade power relationships – specifically around Russia’s relationship with China and a pivot from East West to East East – and its limitations.

https://www.txfnews.com//News/Article/7339/Ukraine-Trade-Risk-Briefing-There-is-...


EXIM's first Black leader faces challenges on China, climate, equity

(Sherrod Brown, Washington, 10 February 2022) U.S. Sen. Sherrod Brown (D-OH), Chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs, applauded Reta Jo Lewis’ confirmation as President of the Export-Import (EXIM) Bank. Lewis was confirmed by a vote of 56-40. Lewis currently serves as a Senior Fellow and Director of Congressional Affairs at the German Marshall Fund, where she leads bipartisan efforts to strengthen transatlantic cooperation. Before joining the German Marshall Fund, Ms. Lewis served in the Obama Administration as the State Department’s first-ever Special Representative for Global Intergovernmental Affairs. Reuters noted that EXIM starts a new era as Lewis takes office as the first person of color and the first Black woman to lead the agency, facing challenges on competing with China’s massive export financing, climate change and racial equity.

https://www.brown.senate.gov/newsroom/press/release/brown-lewis-confirmation-win...


Total’s East African crude oil pipeline ‘struggling’ to find financiers

(NationofChange, Costa Mesa CA, 8 February 2022) Campaigners have for years opposed the proposed pipeline and associated oil projects. They say that EACOP – which is set to be electrically heated to keep the oil at the right temperature – would cut through vital rivers and forest ecosystems. If the pipeline is built, over 100,000 people across Uganda and Tanzania would lose agricultural land, and thousands could lose their homes. TotalEnergies and partner China National Offshore Oil Corporation (CNOOC) signalled a public intention to proceed with the project last week. They pledged to invest more than US$10 billion in developing crude oil production in East Africa, in addition to the estimated $3.5-$5 billion cost of the pipeline. However, a coalition of environmental and human rights groups opposing the pipeline, Stop EACOP, says the announcement is thin on detail and the project is not yet assured. Last month, HSBC, Mizuho and the United Overseas Bank all confirmed they are not supporting the project. The statements bring the total number of banks that have distanced themselves from the project to 11, including ANZ, Barclays, BNP Paribas, Crédit Agricole, Credit Suisse, Royal Bank of Canada, Société Générale and UniCredit. After announcing the final investment decision, the shareholders of the East African Crude Oil Pipeline (Eacop) now turn to looking for money.

https://www.nationofchange.org/2022/02/08/totals-east-african-crude-oil-pipeline...


AfCFTA Secretariat, Afreximbank Seal Deal on $10bn Fund to Boost African Economies

(This Day Live, Lagos, 10 February 2022) The African Continental Free Trade Area (AfCFTA) Secretariat and the African Export-Import Bank (Afreximbank), yesterday in Cairo, signed an agreement on the management of the AfCFTA Adjustment Fund (ADF) that would require $10 billion over the next five to 10 years. The base fund is a facility that would support African countries to cope with the loss of revenues from import tariffs and the private sector to effectively participate in the new trading environment established under the AfCFTA. Already, Afreximbank has committed $1 billion towards the ADF, which is made up of a base fund, a general fund and a credit fund.

https://www.thisdaylive.com/index.php/2022/02/10/afcfta-secretariat-afreximbank-...


AfreximBank Trade Centre Harare project to start soon

(Construction Review, Nairobi, 7 February 2022) AfreximBank Trade Centre will house the bank’s southern Africa regional office, that it is part of a bigger strategic plan to transform the bank’s regional offices and headquarters into a network of AATCs. The entire project cost is now estimated to be close to $100 million; however, precise figures are still being finalized. The Harare AATC will include 30 000 square meters of built space, including prime corporate office space, a four-star hotel, conferencing facilities, trade information services, a tech incubation lab, and other amenities. The African Export-Import Bank Africa Trade Centre (AATC), often known as Afreximbank, head office in Harare is taking form, with full drawings already sketched and building set to begin in the third quarter of this year. The project, which is anticipated to be completed by 2025, will make Harare a critical hub for delivering the African Continental Free Trade Agreement’s promise (ACfTA).

https://constructionreviewonline.com/biggest-projects/afreximbank-trade-centre-t...


Sustainability in export finance – the push for change

(TXF News, London, 2 February 2022) The volume of sustainable deals within the export finance sector is growing. But to take this forward positively across all industrial sectors requires a sensible debate with a clear pathway to ensure business is not lost. Widespread sustainability within export finance is something which has come relatively late to the framework of export credit agency-backed financing, particularly when compared to development bank financing activity. For some time there has been a wide perception that export financing is lagging behind DFI financing in terms of overall sustainability. But its here now and is on the agendas of ECAs and most international commercial banks alike. This has not been easy and will still be tough for ECAs going forward. Why? Because ECAs are there to support and service their exporters, and many of these companies are going to be involved in some way and in some part of the energy transition for decades to come. This is a big debate which will no doubt rage for some time to come. The issue of sustainability within the export finance industry grew last year with the publication of the International Chamber of Commerce White Paper on Sustainability in Export Finance.

https://www.txfnews.com/News/Article/7329/Sustainability-in-export-finance-the-p...


Italy clears hurdle to buy SACE in $4.8 bln deal

(Reuters, Rome, 25 January 2022) Italy approved a long-awaited decree needed for the Treasury to buy credit insurance agency SACE from state lender Cassa Depositi e Prestiti (CDP) in a deal expected to be worth around 4.25 billion euros ($4.81 billion). The Treasury wants to directly control the export agency, given its growing importance in supporting the economy. Rome supports SACE by partly sharing its risk exposure, which could potentially hurt public finances over time. SACE's governance will be in the hands of the Treasury, dealing a blow to Di Maio whose Foreign Affairs Ministry, according to one of the sources, is set to lose control over strategic decisions regarding the export credit. The deal reverses the divestment made during the 2012 sovereign debt crisis by the technocrat government of Mario Monti, which sold SACE to the CDP for around 6 billion euros.

https://www.reuters.com/business/finance/italy-approves-decree-buy-export-agency...


Building a bank for entrepreneurs is crucial, says CEO of Bpifrance

(New African Magazine, London, 11 February 2022) Bpifrance Assurance Export, a department of the investment bank Bpifrance, administers French state export guarantees management, transfered from the the Coface Group in 2015. Bpifrance notes that it helps stimulate French business’ growth by offering loans, providing guarantees and awarding buyer credit and supplier credit to encourage business abroad. It finances over 80 000 companies and provided over 6000 investment loans and 50000 short term loans in 2018 with a total production of 19 billion euros. Bpifrance is also the innovation agency for entrepreneurs with 1,3 billion euros of innovation soft loans distributed to 6000 companies every year.

https://newafricanmagazine.com/27763/


Canada Bangladesh FTA negotiations with EDC role?

(New Age Business, Dhaka, 8 February 2022) The governments of Bangladesh and Canada are working on signing a free trade agreement and a foreign investment promotion and protection agreement to increase bilateral trade between the two countries. Masud Rahman, president of the Canada-Bangladesh Chamber of Commerce and Industry, said that Export Development Canada (EDC) can play a role in increasing investment through the formation of ‘Bangladesh Fund’.

https://www.newagebd.net/article/162236/fta-negotiations-with-canada-underway-en...


Africa’s Fossil-Fuel Investment Trap

(Foreign Affairs, Congers NY, 17 February 2022) By continuing to finance gas expansion in Africa Nnimmo Bassey and Anabela Lemos argue that outside investors, including ECAs, are in fact displacing renewables, delaying Africa’s energy transition, and making it harder for countries to decarbonize and escape a harmful extractive economic model. Investments in renewable energy would produce an economic model that is cheaper, more reliable, and more democratic. Africa need not be seen as a site of destitution and need. It is a continent with rich knowledge, practices, and potential for establishing ecologically sound socioeconomic systems — ones that don’t replicate the mistakes made by so many others in the past century. Ending coal finance now but oil and gas investments later, as advocated by Nigeria's Vice President Yemi Osinbajo, puts off African development now and continues to channel these investments into corrupt regimes and/or inefficient technologies, and not into more immediate benefits from new efficient long-term electricity/energy technologies for Africans now.

https://www.foreignaffairs.com/articles/africa/2022-02-17/africas-fossil-fuel-tr...


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