ECA Watch Newsletter

What's New for February 2023

"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.

  • LNG at forefront of Dutch Atradius foreign fossil fuel funding
  • Atradius backs Dutch construction companies profiting from devastating Philippines mega-airport
  • Insurance giant Marsh under fire over role in controversial oil project
  • 26 Italian oil and gas companies visit Kuwait with SACE
  • Environmentalists continue to challenge UKEF funding for gas in Mozambique
  • OECD Civil Society Joint Position on ECA oil and gas restrictions
  • Progress within export finance on sustainability, but changes sorely needed on OECD Arrangement
  • WFW advises HSBC on US$300m SACE Facility for Bahrain's nogaholding
  • The French Mistral: The Case of the Russian Sale and Its Aftermath
  • Lessors & ECAs lead rhuge Air India jet order while Kenya Airways defaults on EXIM
  • Public Financing as a Critical Path Forward to a Just Energy Transition in Africa
  • Swedish Export Credit (SEK) Securities Exchange Act Form 6-K
  • Finnvera Group 2022 Financial Statements
  • New ECGC policies to support Indian Exporters: Economic Survey Report 2023
  • Pandemic, disasters, war: Michal Ron looks back on Berne Union Presidency

LNG at forefront of Dutch Atradius foreign fossil fuel funding

(Argus Media, London, 22 February 2023) The Netherlands is assessing several applications for international fossil fuel projects that could be granted state funding until the end of 2023, most of which target the LNG supply chain. Dutch export credit agency Atradius — in charge of the country's public financing for foreign fossil fuel projects — received 10 such applications before the end of last year that amount to €3.9bn in state funding if granted, according to a government document. The government in 2021 committed to ending all public financing for international unabated fossil fuel projects by 2022 but granted a one-year exemption to applications that were submitted before the deadline. Six of the 10 applications submitted before the end of 2022 concern transactions related to projects in the upstream sector, including the processing system for a new LNG project, a new offshore LNG project and the construction of a floating production platform for new fossil-fuel infrastructure, the government said today. Other applications concern the supply and delivery of vessels for existing and new fossil-fuel infrastructure. In addition, Atradius already granted coverage commitments for €8.4mn, with three projects related to the sale of LNG and two to the development of a new gas pipeline and the adaption of existing storage tanks. The government said that for "business sensitivity" reasons, it did not disclose the names of the applicants or the country where the projects would be located. The government's commitment in 2021 to ending public financing for international unabated fossil fuel projects built on a pledge made at the UN Cop 26 climate summit in Glasgow, which had already made room for exceptions "in limited and clearly defined circumstances that are consistent with a 1.5-degree warming limit and the goals of the Paris agreement". This included projects that "safeguard security of supply in Europe", such as LNG terminals and infrastructure developed for existing LNG sources, the Dutch government said last year. By Florence Schmit

[Dutch police arrested six climate activists at their homes on January 26th for planning to block the A12 highway to nonviolently demand an immediate end to the government's annual fossil subsidies. Nearly 40 civil society organizations and more than 1,000 people held a solidarity demonstration on the highway on January 28th - 768 were arrested and another demonstration is planned for March 11.. Dutch and Brazilian CSOs have also written to Dutch officials protesting support for a Brazilian floating production storage and offloading (FPSO) vessel ]

https://www.argusmedia.com/pages/NewsBody.aspx?frame=yes&id=2422404&menu=yes


Atradius backs Dutch construction companies profiting from devastating Philippines mega-airport

(Global Witness, London, 2 February 2023) Global Witness’ new report reveals how a new mega-airport north of Manila displaced hundreds of residents after a coercive consultation process in which armed soldiers were sent door-to-door, leaving community members describing feeling “terrified”... The Dutch company Royal Boskalis Westminster NV signed a contract worth €1.5bn with a Philippines conglomerate to construct the first phase of the project, with insurance granted by the Dutch state via export credit agency Atradius Dutch State Business. According to local communities, around 700 families stood to be evicted from their homes with about half reportedly receiving no compensation The New Manila International Airport project threatens Manila Bay’s diverse coastal ecosystems which are vital to prevent worsening climate change, as well as threatening to decimate marine biodiversity and migratory bird populations.

https://www.globalwitness.org/en/press-releases/dutch-construction-companies-wil...


Insurance giant Marsh under fire over role in controversial oil project

(Inclusive Development International, Asheville NC, 7 February 2023) Ugandan, Tanzanian and U.S.-based human rights and environmental groups have lodged a formal complaint alleging that Marsh is violating OECD guidelines for responsible business conduct by serving as insurance broker for the planned East African Crude Oil Pipeline (EACOP). The complainants are calling for Marsh to drop its insurance brokerage role for the EACOP. Inclusive Development International and 10 human rights and environmental organizations in Uganda and Tanzania, which are remaining anonymous due to fear of reprisals, filed a complaint to the U.S. government today alleging that New York-based insurance giant Marsh, a member of the Marsh McLennan group, violated international guidelines for responsible business conduct by serving as insurance broker for the highly controversial East African Crude Oil Pipeline (EACOP). The groups submitted the complaint to the U.S. National Contact Point (NCP) for the OECD Guidelines for Multinational Enterprises, an office within the U.S. State Department tasked with handling allegations against American companies.

https://www.inclusivedevelopment.net/pipelines/insurance-giant-marsh-under-fire-...


26 Italian oil and gas companies visit Kuwait with SACE

(Ansamed, Rome, 1 February 2023) Some 26 Italian companies operating in the oil and gas sector visited Kuwait Jan 30-31 as part of a trip organised by the Italian embassy in close collaboration with the Italian Export Credit Agency (SACE), Confindustria, the main association representing manufacturing and service companies in Italy, and the Italian Trade Agency. During the visit, meetings were held including ones at the Kuwait Chamber of Commerce and Industry, the Kuwait Petroleum Corporation (KPC) and the Ministry of Electricity and Water (MEW), as well as in-depth sessions discusing "doing business in Kuwait" curated by KPMG and major Kuwaiti law studios. In his opening remarks, the Italian ambassador to Kuwait, Carlo Baldocci, highlighted significant opportunities for Italian companies in Kuwait..

https://www.ansamed.info/ansamed/en/news/sections/economics/2023/02/01/26-italia...


Environmentalists continue to challenge UKEF funding for gas in Mozambique

(Mediarun Search, London?, 13 February 2023) In January, an appeals court rejected the request, but Friends of the Earth wants the arguments to be heard again by the Supreme Court (Portugal’s equivalent of the Constitutional Court). “The funding decision was made without taking into account the impressive emissions from flaring the gas, and without considering how these emissions align with globally agreed climate targets,” they said in a statement. Before passing a judgment, the Supreme Court will first assess the appeal and determine whether it has merit and whether an issue of greater constitutional importance is at stake. British export credit agency UK Export Finance (UKEF) has committed US$1,150 million (€1,077 million) in funding in 2020 to develop an offshore liquefied natural gas (LNG) project in the Rovuma Basin in Cabo Delgado, northern Mozambique. But Friends of the Earth say the environmental impact has not been properly assessed, contrary to the UK’s commitment to comply with the 2015 Paris Climate Change Agreement to limit global warming. The organization estimates that over the years of operation, the project will generate up to 4,500 million tons of greenhouse gases. The project in question, promoted by a consortium led by French oil major Total Energies in the Rovuma basin, was suspended in 2021 after attacks by armed groups in Cabo Delgado province. Worth between 20,000 and 25,000 million euros, the gas extraction megaproject is one of the largest private investments planned for Africa and is supported by several international financial institutions.

https://www.mediarunsearch.co.uk/environmentalists-have-appealed-to-challenge-br...


OECD Civil Society Joint Position on ECA oil and gas restrictions

(Oil Change International, Washington, 27 February 2023) Over 175+ organizations from over 45 countries have signed onto a Joint Civil Society Position calling for a robust prohibition on oil and gas finance under the OECD Arrangement on Export Credits. Export Credit Agencies (ECAs) are the world’s largest international public financiers of fossil fuels, supporting an average of over $33 billion USD per year in fossil fuels- which is 7x the amount of their support for renewable energy. The Joint Position calls on OECD negotiators, including the US, EU Commission, Canada, UK, and others, to table a robust proposal on oil and gas prohibition to listen to the science and align the Arrangement with a 1.5C warming trajectory. One week before international negotiators meet at the Organisation for Economic Co-operation and Development (OECD) in Paris (March 6-9) to discuss aligning export finance with international climate goals, more than 175 civil society organizations (CSOs) from over 45 countries have released a Joint Position calling on world leaders to end OECD export finance for oil and gas, and explaining how it can be done. They urge OECD members who consider themselves climate leaders to table a proposal for doing so. The position is also supported by the Co-presidents of the Club of Rome,

https://priceofoil.org/2023/02/27/over-175-organizations-launch-proposal-for-the...


Progress within export finance on sustainability, but changes sorely needed on OECD Arrangement

(TXF, London, 10 February 2023) The International Chamber of Commerce (ICC) White Paper update of its 2021 report shows that ECAs and banks have made good progress on the sustainability front, but lack of change to the OECD Arrangement is holding the sector back. The original White Paper (produced by ICC, Acre Impact Capital, The Rockefeller Foundation, and International Financial Consulting) provided policy and product recommendations designed to align the industry with the United Nations SDGs. The White Paper not only offers a roadmap towards a more sustainable export finance industry, but also provides suggestions from industry participants as to how the sector can change to ensure there are better terms for financing particularly for social projects and transactions. Launched at an ICC workshop on 8 February in Paris, discussions took place around the policy aspect, the framework alignment, the positive steps already witnessed and the route ahead for the sector including the roadblocks that are getting in the way of further improvements. Speaking to TXF about the Whiter Paper update, Chris Mitman, co-chair of the ICC Sustainability Working Group (ICC SWG) said: “It’s clear from this White Paper update that the vast majority of export finance participants – banks and ECAs – have individually made step changes in their response to the SDG delivery challenge. It’s also clear at an industry level there are encouraging signals from the EU and the majority of the Berne Union membership that a fundamental reform of the regulatory framework – most notably the OECD consensus – is required.” He added: “It’s critical therefore, that those few who are fortunate enough and have the privilege of holding seats at these unprecedented OECD modernisation discussions, take this once in a lifetime opportunity to put the export finance industry in a fundamentally stronger position to contribute meaningfully to the delivery of the SDGs."

https://www.txfnews.com/articles/7503/Progress-within-export-finance-on-sustaina...


WFW advises HSBC on US$300m SACE Facility for Bahrain's nogaholding

(WFW, London, 9 February 2023) Watson Farley & Williams (“WFW”) advised HSBC Bank Middle East Limited, acting as Export Credit Agency (ECA) Co-ordinator and Sole Structuring Bank, and HSBC Bank plc (jointly “HSBC”) as Agent and Sustainability Co-ordinator, on a US$300m Push Facility guaranteed by the Italian Export Credit Agency (“SACE”) to the Oil and Gas Holding Company B.S.C. (“nogaholding”) for financial support for key energy projects in the Kingdom of Bahrain. Under this financing, nogaholding commits to pre-agreed sustainability objectives. The 10-year financing structured as a sustainability-linked loan is part of SACE’s Push Strategy programme and aims to increase business opportunities for Italian exporters, strengthening SACE’s positioning in a strategic region for Italian exports. The Push Strategy primarily targets local counterparts of Italian exporters – selected and leading foreign buyers and provides access to medium to long-term financing guaranteed by SACE to support their investment and growth plans.

https://www.wfw.com/press/wfw-advises-hsbc-on-us300m-push-facility-with-sace-for...


The French Mistral: The Case of the Russian Sale and Its Aftermath

(SLD Info, Paris, 16 February 2023) France took a financial hit of €409 million ($440 million) as a result of  its 2015 cancellation of the sale of two helicopter carriers to Russia, the national audit office said in its report on French arms exports. “In total, taking into account the result of negotiations with Russia, cancellation of payments, payments to Naval Group, modifications and the sale of the ships to Egypt, this transaction cost France €409 million,” the independent office said in its report, Support for Export of Military Matériel. The then French president, François Hollande, cancelled in August 2015 a controversial sale of the Mistral class warships, under pressure from the U.S., central European and Baltic nations, after Russia seized in 2014 the Crimean peninsula from Ukraine. France paid Russia total reimbursement of €949.75 million for cancelling the order for the Mistrals, comprising a core payment of €892.9 million, and a further €56.8 million, the Sept. 15 2015 National Assembly report said. Egypt’s purchase of the two Mistrals followed Cairo’s 2015 order for French weapons worth €5.2 billion for 24 Rafale fighter jets, a FREMM multimission frigate, and air-to-air and naval missiles. Coface consistently made money between 2010-2021, with premiums exceeding claims, the report said, with only 2015 showing a net loss of €82 million due to the claims made on cancellation of the Mistral deal with Russia. The sale to Egypt limited the amount of claim, the report said.

https://sldinfo.com/2023/02/the-french-mistral-the-case-of-the-russian-sale-and-...


Lessors & ECAs lead rhuge Air India jet order while Kenya Airways defaults on EXIM

(Reuters, Bengaluru, 15 February 2023) As global aerospace savours a record Air India 500-plane deal cheered by world leaders, it is the turn of leasing companies to line up for a piece of the action. "The large majority of these aircraft are likely to be financed through sale-and-leasebacks with perhaps 20% of the financing come from the (Western) export credit agencies," said aviation adviser Bertrand Grabowski. Experts say the mainly Dublin-based lessors, who rent jets out for a monthly fee, could play a significant role in financing the Tata-owned airline's Airbus and Boeing spree. In other news, the Export-Import Bank of the United States issued Kenya a default notice for delayed payment of a $454 million loan that the government borrowed to fund Kenya Airways. The flag carrier defaulted on the part of its $525 million loan from Exim, which the Kenyan government guaranteed. The Kenya National Treasury plans to reduce Kenya Airways' state funding by $79.8 million, taking it from $239.5 million to $159 million, according to its 2022-23 supplementary budget. The treasury is reducing its support for the flag carrier in line with the government's strategy to lessen the airline's dependency on state funds by the end of 2023, although the airline will receive $283 million in financial aid from the state to continue operations.

https://www.reuters.com/business/aerospace-defense/lessors-lead-rush-finance-hug...


Public Financing as a Critical Path Forward to a Just Energy Transition in Africa

(Creamer Media's Engineering News, Pretoria?, 13 February 2023) With the world population recently crossing the 8 billion mark and Africa expected to contribute more than half of the projected increase in the global population up to 2050, now more than ever, access to reliable, sustainable, and affordable energy is critical for the continent. Given the historical strain between developed economies (which modernized with fossil fuels) and developing economies (now being asked to forgo this route) [while developed country ECAs urge them to expand fossil fuel production!], it is evident that sustainable, long-term global cooperation and energy security will be required to address the need for Africans to have access to sustainable, reliable, and affordable energy... Electricity generation in South Africa and Nigeria accounts for more than 80% of GHG emissions on the continent. In South Africa, coal-fired generation currently accounts for more than 70% of installed capacity and is expected to remain the primary power generation source through 2030... South Africa’s Integrated Resource Plan aims to install 3GW and 9.6GW of solar and wind capacity respectively between 2023 and 2028 as well as  3GW of gas by 2030. In contrast, Nigeria, on the hand has about 13 GW of installed generation capacity, largely dependent on hydropower (12.5%) and thermal power (87.5%). Of this, only 3.5 GW to 5 GW are typically available for onward transmission to the final consumer. Self-generation installed capacity via diesel generator units is estimated to be about 25 GW... Public capital plays an essential role in accelerating energy infrastructure projects in both developed and developing markets. Developing markets especially need continued government-supported financing for renewables and gas power generation to enable an equitable energy transition... To meet global decarbonization goals while continuing to drive electrification and raise the standard of living in developing markets, ECAs and DFIs should strive to become even more engaged to support a broad range of decarbonization technologies. [We ask, what balance is necessary, support of new natural gas power generation projects to replace existing or planned coal assets, or African renewable sources which do not put the onus on Africans to save the planet while sustaining northern consumption excess?]

https://www.engineeringnews.co.za/article/public-financing-as-a-critical-path-fo...


Swedish Export Credit (SEK) Securities Exchange Act Form 6-K

(Street Insider, Birmingham, MI, 1 February 2023) SEK Year End Report 2022: Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. February 1, 2023 Swedish Export Credit Corporation, Magnus Montan, Chief Executive Officer. SEK has maintained a strong business flow during the year, including in the fourth quarter. New lending in the fourth quarter amounted to Skr 34.8 billion, and Skr 133.2 billion for the full year, which was the highest ever new lending volume in the space of one year... Overall, the credit portfolio has an extremely high credit quality and SEK often uses risk mitigation measures, primarily through guarantees from the Swedish Export Credit Agency (EKN) and other government export credit agencies in the Organisation for Economic Co-operation and Development (OECD), which explains the low provision ratio.... New lending Skr 133.2 billion (2021: Skr 77.0 billion), new green lending Skr 7.4 billion [Note "green" is 9.6% of all new lending] (2021: Skr 11.5 billion; new green borrowing Skr 9.0 billion (2021: Skr 6.1 billion)

https://www.streetinsider.com/SEC+Filings/Form+6-K+SWEDISH+EXPORT+CREDIT+For%3A+...


Finnvera Group 2022 Financial Statements

(Yahoo Finance, Helsinki, 16 February 2023) “Despite the impacts of the coronavirus pandemic, the war launched by Russia and the uncertain operating environment as well as inflation, Finnish companies were very active in 2022, and the demand for Finnvera’s financing remained at a high level. Finnvera granted domestic loans and guarantees amounting to EUR 1.0 billion (1.5). More than 90% of the financing was allocated to Finnvera’s strategic priorities, that are start-ups, companies aiming for growth and internationalisation and, for example, transfers of ownership. Finnvera granted EUR 5.9 billion (4.6) in export credit guarantees and special guarantees, and EUR 0.9 billion (0.7) in export credits. The largest individual financing projects concerned forest sector deliveries to Brazil and telecommunications sector deliveries to the United States and Japan. Finnvera has paid a total of EUR 100 million in compensation for liabilities at the beginning of February 2023. The final amount of Finnvera’s losses will be determined later. The loss provisions for exposure in Russia remained unchanged, the loss provisions made in the cruise shipping sector were reduced and the loss provisions for the domestic financing increased in the last quarter of the year. Due to the war and arrangements necessitated by sanctions, Finnvera’s exposure relating to Russia more than halved to EUR 422 million during the year,

https://uk.finance.yahoo.com/news/report-board-directors-financial-statements-09...


New ECGC policies to support Indian Exporters: Economic Survey Report 2023

(Taxcan, New Delho, 1 February 2023) The Economic Survey Report 2023 points out the significance of new Export Credit Guarantee Corporation (ECGC) policies to support Indian Exporters and the expectational changes by the 2023 Budget. The Export Credit Guarantee Corporation (ECGC) supports Indian exporters and banks by providing export credit insurance services. The new scheme launched in July 2022, under its ECIB products, has the enhancement of the mechanism of insurance cover to banks providing pre-shipment and post-shipment financeto 90 per cent from an average coverage of 70% for accounts with an export working capital limit of up to X20 crore to support small exporters. This framework could largely reduce the net demand for foreign exchange, the US dollar in particular, for the settlement of current account-related trade flows. Further, the use of INR in cross-border trade is expected to mitigate currency risk for Indian businesses. The Key aspect of this was that it could assist Indian exporters in getting advance payments in INR from overseas clients and in the longer term promote INR as an international currency once the rupee settlement mechanism gains traction.

https://www.taxscan.in/new-ecgc-policies-to-support-indian-exporters-economic-su...


Pandemic, disasters, war: Michal Ron looks back on Berne Union Presidency

(Global Trade Review, London, 30 January 2023) Michal Ron was elected president of the Berne Union, the international association for the export credit insurance industry, at a particularly unstable time for global trade. In an exclusive interview with GTR, she looks back on her two-year term, which included major shocks to the trade credit insurance sector, beginning with a global pandemic and ending in war in Europe. "Starting with a global pandemic, it was already in one of the worst moments, during lockdown. Then we had a very high number of natural disasters… all a consequence of climate change. And then as if that wasn’t enough, we had the war in Ukraine, at the very heart of Europe. One of my objectives when I began was definitely inclusivity and giving a voice to the lesser-known emerging markets, that multilateralism approach... Another was climate. Climate for me was one of the biggest pillars of my presidency. We created a working group task force on climate that included not just members of the Berne Union, but also the banking sector, development finance institutions and multilaterals. So that has been extremely effective and helpful for those of us who are, to an extent, lagging behind in terms of transformation towards greener, renewable energy, the circular economy... I also opted for a geographical region as an area of focus, because of its potential, which is the Sub-Saharan Africa region. Not everyone exports to, or is active in, that continent. But this is still the area where the largest growth, both trade and GDP, per annum is forecast. It is a very complex, and we could say also a particularly challenging region to operate in... My biggest regret for this period was also on the multilateralism front. As a result of the Ukraine war, we had to suspend the membership of the Union for two countries, Russia and Belarus. It went against all my past ideology, in terms of professional conduct on export credit and because it goes against the apolitical nature of the Berne Union. It was the first time ever that members were suspended on a geopolitical basis. It was petitioned by many of the Berne Union members, and it became inevitable when the UN came out with a resolution last March, condemning both countries on the international front, and sanctions were introduced. GTR: The war has also caused major energy price hikes; do you think export credit agencies (ECAs) are going to play a bigger role in helping secure imports, like the recent deals Euler Hermes has guaranteed with Trafigura for German gas and strategic commodities imports? Ron: We call it a strategic import. It might have different names in different countries, but that’s what we’re looking at. It has become part of many ECAs’ portfolios and we are seeing the number increasing day by day... GTR: Does ECA support for gas potentially contradict some climate goals, especially for members of the Export Finance for Future, who have committed to phasing out support for fossil fuels? Ron: There is no one-size-fits-all solution to this issue. You have countries that are very adventurous in terms of climate change. Very few, but still some, have already declared a net-zero strategy already commencing on the first of January [2023]. But let’s not forget that so far we are talking about four ECAs... But then you have countries such as Germany, such as Italy, that have been very dependent on gas. This is clearly an issue that has internal contradictions in terms of what to do about public support for fossil fuels. We obviously have a situation where we need to take into account a gradual phasing out, rather than an abrupt one point in time. At the Berne Union we’re doing a lot of information-sharing seminars in order to learn from more adventurous and greener export credit agencies and companies, insurers: how they do it, how they got there, how are they using scientific criteria to monitor progress? We are, in parallel, grappling with the complexity of ensuring additional sources of energy. I think most of us will not go back to the worst offenders such as coal-based plants.

https://www.gtreview.com/news/global/pandemic-disasters-war-michal-ron-looks-bac...


What's New for January 2023

"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.

  • Public Financing as a Critical Path Forward to a Just Energy Transition in Africa
  • Trade Finance In Wartime
  • Heads of G7 Export Credit Agencies Express Support for Ukraine
  • Court finds UKEF’s $1.15 bln funding for Mozambique LNG project lawful
  • UKEF signs deal with Egyptian construction titan to boost post-Brexit trade with Africa
  • "Green" Hydrogen: What role for ECAs?
  • Comparing Government Financing of Reactor Exports
  • Saudi and Italian ECAs sign MoU to enhance trade cooperation
  • Mexico Expects State Oil Giant Pemex to Pay Its Debt Without Government Help
  • Chinese export insurer scales up support for foreign trade
  • Spain's CESCE restricts fossil fuel finance, but leaves major gas loopholes
  • India extends aid worth USD 3.9 billion to help Sri Lanka face economic crisis
  • Uganda cancels $2.2bn Chinese rail contract, signs with Turkey
  • GE secures €1bn agreement with Polish ECA
  • Finnvera change signals new ECA opportunities for SMEs
  • Dutch climate expenditure audit reveals inconsistencies

Public Financing as a Critical Path Forward to a Just Energy Transition in Africa

(Engineering News, Johannesburg 12 January 2023) The path to decarbonizing the energy sector is not a “one-size-fits-all” between developed and developing markets. Given the historical strain between developed economies (which modernized with fossil fuels) and developing economies (now being asked to forgo this route), it is evident that sustainable, long-term global cooperation and energy security will be required to address the need for Africans to have access to sustainable, reliable, and affordable energy. If we truly want to increase electrification in developing countries in Africa and help provide reliable, affordable, and sustainable energy, policy makers and financial institutions must partner with project sponsors to tailor capital solutions that best fit the region and its countries. ECAs and DFIs along with commercial banks and other multilaterals play a critical role in enabling access to the capital required to deliver a more just and equitable energy transition today and for future generations. In a recent opinion piece, Jonathan Bell, Editor in Chief of TFX News asks "When will sub-Saharan Africa be able to properly see the light?' and addresses "the jokers that think such countries ought to be moving straight to renewables – they need to ask how could they pay for such projects, and how could any related debt be repaid?" With respect to the Friends of the Earth opposition to the Mozambique LNG project he argues that "some of [those] volumes to be exported were destined to be used in power generation to replace coal and oil generators - a move which would lower carbon emissions globally." [What's New Editorial comment: Given that northern industrial development was largely financed on the backs of African slaves, one could also ask why we must hold back on tightening our own belts and coming up with the admittedly huge means to pay for their carbon free investments, in reparation for what we got from Africa, instead of begging for the delay of a long overdue "just" transition to keep ourselves warm.]

https://www.engineeringnews.co.za/article/public-financing-as-a-critical-path-fo...


Trade Finance In Wartime

(Global Finance, New York, 3 January 2023) According to the World Bank, Ukraine’s GDP over 2022 will have contracted by some 35%. Further decline is expected for 2023, as the full economic implications of Russia’s war become clear. The huge drop-off in trade has of course severely impacted trade finance. Many of the correspondent banks that used to do regular business pulled away, while long-term financing projects have been pretty much shelved across the board. ECA coverage is scarce in the extreme. In many cross-border transactions, cash is king. The international media has rightly focused on the huge disruptions to supply lines, including shipments of Ukrainian grain from Black Sea ports, and Russian targeting of Ukraine’s energy infrastructure has cast much of the population into freezing darkness and has massively disrupted business. With foreign banks and customers understandably jittery, the role of international financial institutions like the International Finance Corporation in guaranteeing transactions has been key. The European Bank for Reconstruction and Development (EBRD) has firmly committed to supporting Ukraine. Ukrexim’s Shchur echoes this, “At such a fateful time, we really want to encourage prominent foreign banks and ECAs to become more actively involved in trade finance operations here.

https://www.gfmag.com/magazine/january-2023/trade-finance-ukraine-russia-war


Heads of G7 Export Credit Agencies Express Support for Ukraine

(UKEF, London, 22 January 2023) Acknowledging the G7 Leaders’ Statement on Support for Ukraine, as heads of the official export credit agency (ECA) schemes of the G7 nations – Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States of America – we wish to express our ongoing support for Ukraine and for its reconstruction efforts and our unwavering solidarity with the Ukrainian people for as long as it takes. Since Russia’s full-scale invasion of Ukraine, the G7 ECAs have remained open for underwriting Ukrainian business opportunities in solidarity with Ukraine during this difficult time. We also continue to participate in the wider dialogue with other ECAs and multilateral institutions, including within international fora such as the Berne Union, to find ways to enhance cooperation, share information and leverage our collective platforms to bring visibility to and stimulate support for Ukraine.

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


Court finds UKEF’s $1.15 bln funding for Mozambique LNG project lawful

(Offshore Energy, Schiedam, 13 January 2023) A London court has ruled that the UK government’s funding of up to $1.15 billion of financing for the Mozambique LNG project led by French energy major TotalEnergies is lawful. According to reports by Reuters, the decision by London’s Court of Appeal dismissed an appeal by the environmental group Friends of the Earth. The group argued that financing for the project was permitted after it was incorrectly judged to be compatible with the Paris Agreement and its goal to limit global warming to 1.5 degrees. The total emissions for the new gas field, which research by the environmental group finds would total some 4.5 billion tonnes of greenhouse gases (GHG) over its lifetime – more than the combined annual emissions of all 27 EU countries, were not calculated as part of the government’s approval process or evaluated against global climate goals, the environmentalists warned. At the time of filing the legal challenge, Leigh Day solicitor Rowan Smith, who represented Friends of the Earth, noted that the Court of Appeal’s answer is likely to be a “defining moment in climate change litigation”.

https://www.offshore-energy.biz/report-court-finds-uks-1-15-bln-funding-for-moza...


UKEF signs deal with Egyptian construction titan to boost post-Brexit trade with Africa

(City A.M., London, 20 January 2023) (UK Export Finance has agreed a post-Brexit deal with one of Egypt’s biggest construction and engineering firms, Hassan Allam Holding, to increase cooperation across Africa. Hassan Allam has a vast a portfolio of projects ranging from solar power and water to petrochemicals facilities, museums, airports, and thousands of kilometres of roads and bridges. UKEF has up to £2bn available to support projects in Egypt, as Britain looks to spread its wings after leaving the European Union and trade globally.

https://www.cityam.com/egypt-africa-uk-export-finance-deal/


"Green" Hydrogen: What role for ECAs?

(ECA Watch, Ottawa, 30 January 2023) A series of articles appearing in our Google Alert searches for "export Credit" point to a number of interesting pieces on ECAs and hydrogen. The IEA has forecasted the global green hydrogen market to grow from almost zero in 2021 to 9-14 metric tons per annum (mtpa) in 2030 and 125-300 mtpa by 2050. Exports are expected to account for 12 mtpa of low-carbon hydrogen by 2030, of which approximately 90% is expected to be "green" hydrogen. Today, less than one percent of current hydrogen production is low-carbon. This means most of the hydrogen we make comes from fossil fuel plants that release carbon into the atmosphere. Development of the green hydrogen industry will require substantial capital and the financing for such projects will have to borrow more from the precedents of offshore wind and LNG undertakings, an Oxford Institute for Energy Studies said in its latest study. That study is based on the project financing cost of what it called an ‘archetype’ project wherein 1 GW of solar power is used to make green hydrogen, which is converted to 250,000 tons per annum  green ammonia for export with a capital cost of $2 billion. Last month’s second Green Hydrogen Summit in Muscat brought together leaders in every aspect of the hydrogen value chain from production and transportation to applications and storage.  Spearheaded by the Omani government, the Summit demonstrated the Sultanate’s ambition to be a global leader in green hydrogen.




Comparing Government Financing of Reactor Exports

(Columbia University, New York, 25 August 2022) This report, part of wider work on nuclear energy at Columbia University’s Center on Global Energy Policy, compares the financing terms offered between 2000 and 2021 by the world’s major exporters of nuclear power plants: Russia, France, the Republic of Korea (ROK), China, and the United States. Decarbonizing the world’s energy supply by 2050 will require financing low-carbon energy projects at a cost of upwards of trillions of dollars. Nuclear energy is one of the few dispatchable low-carbon energy resources, and studies by the International Energy Agency have estimated a possible doubling of nuclear power as part of scenarios for achieving net-zero greenhouse gas emissions by midcentury. Large, capital-intensive projects such as nuclear power plants can be challenging for some countries to finance, however. As a result, countries wishing to build nuclear reactors look for attractive financing from supplier nations in the form of loans and equity.

https://www.energypolicy.columbia.edu/publications/comparing-government-financin...


Saudi and Italian ECAs sign MoU to enhance trade cooperation

(Arabian Business, Abu Dhabi, 27 January 2023) The agreement envisages establishing a framework for mutual reinsurance to enhance the presence of Saudi exports in Italian markets. Saudi Export-Import Bank CEO Saad bin Abdul Aziz Alkhalb hailed the agreement as a step forward in the bank’s efforts to improve and diversify Saudi non-oil exports and enhance their competitiveness, in addition to providing funding for Saudi exports and insurance services and export credit insurance with competitive advantages in line with the targets of the Kingdom’s Vision 2030 to increase the value of non-oil exports from 16 percent to 50 percent of the non-oil GDP.

https://www.arabianbusiness.com/politics-economics/saudi-export-import-bank-and-...


Mexico Expects State Oil Giant Pemex to Pay Its Debt Without Government Help

(Yahoo News, Mexico, 3 January 2023) Mexico’s Finance Ministry expects Petroleos Mexicanos to pay debt coming due in the first quarter without government help. Refinancing debt could include but won’t be limited to bank loans, bond issuance, direct financing or financing guaranteed by export credit agencies. After providing the oil company with financial support in recent years, the Finance Ministry now wants Pemex to foot the bill itself unless it doesn’t have enough cash to do so by the end of the quarter... Pemex is the world’s most indebted oil major, with financial obligations of $105 billion by September 2022. It is under enormous financial strain as the Mexican government wants it to halt oil exports and invest in loss-making refineries — all of which while the company fails to stem long-term production declines. Mexico’s oil driller has 188 billion pesos in amortizations due in 2023 and must maintain zero net indebtedness in real terms, it said in its annual financing plan.

https://news.yahoo.com/mexico-expects-state-oil-giant-184347210.html


Chinese export insurer scales up support for foreign trade

(Xinhua, Beijing, 14 January 2023) SINOSURE stepped up efforts to boost the country's foreign trade in 2022, data from the company showed on Saturday. The insurer handled underwriting totaling 899.58 billion U.S. dollars for insured businesses throughout the year, serving over 170,000 clients, it said.  Of the total, 745.16 billion dollars was short-term export credit insurance, up 10.2 percent year on year. The underwriting for small and medium-sized enterprises amounted to 226.78 billion dollars, a 15.7 percent increase from a year earlier...  The company added that it also increased insurance support to stabilize industrial and supply chains, nurture new business models, and boost services exports. SINOSURE is a state-funded and policy-oriented insurance company that promotes China's foreign economic and trade development and cooperation. It was officially launched and put into operation in 2001, and its service network now covers the whole country.

https://english.news.cn/20230114/fc4382e5ff0548a7b77ce5eee3fc97ea/c.html


Spain's CESCE restricts fossil fuel finance, but leaves major gas loopholes

(Price of Oil, Washington, 23 January 2023) Spain has released a new policy for CESCE, the Spanish government export credit agency, restricting public finance for oil and gas. Spain is a major public financier of international fossil fuel projects, providing USD 2.1 billion a year between 2018-20 to fossil fuels, and USD 47 million per year to clean energy, or 97.8% to fossil fuels and just 2.2% to clean energy. Loopholes include support for Liquefied Natural Gas (LNG) processing, transportation and storage, as well as a widely-defined loophole for gas power that could mean gas power plants could be approved in most developing countries. This policy falls short of a major pledge Spain made at the 2021 COP26 UN climate summit to stop financing fossil fuel projects.

https://priceofoil.org/2023/01/23/spains-export-credit-agency-restricts-fossil-f...


India extends aid worth USD 3.9 billion to help Sri Lanka face economic crisis

(Asia News Initiative, New Delhi, 14 January 2023) India's EXIM bank and State bank of India extended export credit facilities worth USD 1,500 million to Sri Lanka for the import of essential commodities. India has extended aid worth USD 3.9 billion to help Sri Lanka sustain itself in face of the acute economic and financial crisis and meet its immediate needs such as medicines, cooking gas, oil and food items, Sri Lanka based news publication News 19 reported. In February 2022, India signed an agreement for the supply of petroleum products worth USD 500 million from the Indian Oil Company through a credit line in order to help Sri Lanka overcome its fuel shortage. This was expanded by an additional USD 200 million worth of petroleum products in April 2022.

https://www.aninews.in/news/world/asia/india-extends-aid-worth-usd-39-billion-to...


Uganda cancels $2.2bn Chinese rail contract, signs with Turkey

(The East African, Nairobi, 12 January 2023) After eight years of non-execution, the Uganda government has terminated the contract of China Harbour Engineering Company (CHEC) to build the country’s first phase of standard gauge railway (SGR), a 273km line from Malaba to Kampala. Kampala says the financing model for the project will also change, with Yapi Merkezi, which is building Tanzania’s SGR, expected to tap into its network to bring Export Credit Agencies (ECAs) on board that will finance and breathe life into the moribund project. The line, starting from the Malaba border post between Uganda and Kenya, was expected to cost $2.2 billion, but the Chinese financiers did not fund the project after casting doubt on Kenya’s SGR reaching the border to link with Uganda’s and making the project viable.

https://www.theeastafrican.co.ke/tea/business/uganda-cancels-sgr-contract-chines...


GE secures €1bn agreement with Polish ECA

(Power Engineering International, Maarssen, 20 January 2023) GE and KUKE, Poland’s Export Credit Agency (ECA), have confirmed a €1 billion ($1.1 billion) export finance co-operation agreement which will help facilitate capital investment, and enable a mix of renewable and gas power projects globally through Polish exports and supply chain. Under the agreement, GE will be the second global organisation to use KUKE’s financial instrument from its new export support programme. KUKE’s financing solutions from the programme serve to encourage industry players to invest, manufacture and export technology around the globe, including new markets, while supporting local supply chains in Poland.

https://www.powerengineeringint.com/nuclear/strategic-development-nuclear/ge-sec...


Finnvera change signals new ECA opportunities for SMEs

Global Trade Review, London, 18 January 2023) Finland’s export credit agency (ECA), Finnvera, can now offer credit directly to foreign customers of Finnish export companies after the country’s parliament approved a necessary amendment last week. Finnvera says that the goal is to give smaller export projects and small and medium-sized enterprises (SMEs) improved access to financing. “Currently, Finnvera grants large export credits to foreign buyers but only in cooperation with banks. However, it has been difficult to arrange buyer financing for export transactions amounting to less than €20mn, which has slowed down the development of the exports of Finnish SMEs in particular,” Juuso Heinilä, executive vice-president at Finnvera, tells GTR.

https://www.gtreview.com/news/europe/finnish-law-change-signals-new-export-credi...


Dutch climate expenditure audit reveals inconsistencies

(Argus Media, Amsterdam, 30 January 2023) The Dutch government does not provide a "clear and complete" overview about the state's climate expenditure, while certain fossil fuel subsidies are "at odds" with domestic climate goals, according to a report by the Dutch court of audit. The court of audit presented its findings to the Dutch parliament on 25 January, noting that the three ministries — economic affairs and climate policy, finance, and climate and energy policy — involved in reporting the state's climate expenditure did not provide consistent information. Dutch export credit agency Atradius — in charge of the country's public financing for foreign fossil fuel projects — ended all financing for export credit insurance as of this year in line with the Glasgow pledge made during the UN climate conference Cop 26 in 2021, while certain exemptions for oil and gas projects remain in place. Projects that ensure European energy supply security by reducing "unwanted" dependencies on Russian oil and gas are among those exemptions granted

https://www.argusmedia.com/en/news/2414260-dutch-climate-expenditure-audit-revea...


What's New for December 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.

  • Germany reveals considation of 10 large international fossil fuel projects worth EUR 1 billion, despite major climate pledge
  • Fitch affirms SACE now under Italian government control
  • Canada to (mostly) stop subsidizing international fossil fuel projects
  • Canada and New Zealand map out pledges to axe ECA fossil fuel support
  • Blocking a Carbon Bomb: Tiwi Islanders prevent $4.7 billion Barossa offshore gas project in Australia
  • What ETMs can and can’t do for coal retirements
  • Australia in talks to help PNG buy $1.1 bln PNG LNG stake
  • Germany accelerates Europe’s “Neo-Scramble for Africa”
  • Germany suspends ECA guarantees for business with Iran amid protests
  • Legal challenge over UK funding of Mozambique gas project goes to appeal court
  • Who watches Czech state’s ECA obligations to big businesses?
  • Are French ECAs ready to join early reconstruction of Ukraine?
  • Poseidon Principles: [Only] 7 of 28 banks in line with IMO’s GHG reduction target
  • Jaguar Land Rover lands UKEF-backed export loan
  • South African exporters assured Export Credit Insurance Corporation now has expanded cover
  • Chinese ECA sees underwriting growth of 9%
  • EU adopts new package of sanctions against Russia

Germany reveals considation of 10 large international fossil fuel projects worth EUR 1 billion, despite major climate pledge

(Oil Change International, Washington, 7 December 2022) A German government State Secretary has revealed a pipeline of fossil fuel projects that shows a lack of seriousness about keeping Germany’s climate promise. The Government stated that it “currently has ten individual applications for cover under review for the granting of an export credit guarantee for supplies and services to Brazil, Iraq, Uzbekistan, the Dominican Republic and Cuba with a total volume of around one billion euros, which are connected with fossil energy projects.” Despite climate rhetoric, Germany still funding more fossil fuels than renewable energy and provides more government-backed international finance for fossil fuels than Saudi Arabia or Russia. Regine Richter, Energy and Finance Campaigner at Urgewald, said: “The German government needs to understand that you can’t say you favour climate protection and at the same time support massive fossil fuel projects. While the German government is tight-lipped about KfW loan applications, the applications for export finance alone add up to more than €1 billion for fossil fuel projects. This must end if we are to stand a chance to stay within the 1.5°C temperature limit.”

https://priceofoil.org/2022/12/07/revealed-german-government-considering-10-larg...


Fitch affirms SACE now under Italian government control

(Fitch, Milan, 29 November 2022) Fitch Ratings has affirmed that SACE's shares were transferred back to the national government from Cassa Depositi e Prestiti SpA (BBB/Stable) in March 2022, changing SACE's mission from an unregulated export credit insurer to a government agency underwriting insurance policies backed by a state guarantee. The Ministry of Finance [now] retains governance rights over SACE and outlines operational features, according to which SACE operates on behalf of the national government.  Fitch expects insurance-related costs to increase in 2023 alongside the macroeconomic volatility triggered by the Russia-Ukraine war and rising commodities prices that could adversely affect Italian export and domestic activities in the short term. SACE's exposure to Russia, Ukraine and Belarus is limited and was fully covered with EUR91 million provision as of June 2022. As we noted last month, the Italian government is considering support for international fossil fuel projects that would emit 3.5 times Italy’s annual emissions, despite major climate promises. Italy is also considering the nationalization of an oil refinery owned by Russian energy giant Lukoil as well as  providing additional guarantees by Italian export credit agency SACE for the purchase of oil outside Russia and selling the refinery to a third-party investor.

https://www.fitchratings.com/research/international-public-finance/fitch-affirms...


Canada to (mostly) stop subsidizing international fossil fuel projects

(Greenpeace, Toronto, 12 December 2022) Canada has joined the growing ranks of nations promising to end international financing of fossil fuels (though there are some worrisome exceptions). The Financial Post immediately warned that without taxpayer subsidies it would be more expensive for private companies to build new fossil fuel projects which… is the whole point of the exercise. The new policy applies across all federal departments, agencies and Crown corporations but will predominantly impact Export Development Canada (EDC), a Crown corporation with a long history of funnelling billions in support to the oil and gas industry. As of January 2023, EDC (and the rest) will have to stop funding (most) fossil fuel projects and redirect those resources to support the clean energy transition.

https://www.greenpeace.org/canada/en/story/55800/canada-to-mostly-stop-subsidizi...


Canada and New Zealand map out pledges to axe ECA fossil fuel support

(Global Trade Review, London, 14 December 2022) Canada and New Zealand have mapped out how they will put into action pledges to scrap ECA support for fossil fuel projects, ahead of an end-of-year deadline. At last year’s Cop26 summit in Glasgow, thirty-nine countries vowed to end public finance backing for fossil fuels by the end of 2022, which theoretically bars ECAs and export finance institutions from providing fresh backing for such projects from January 1, 2023. Canada was the second-biggest public financier of fossil fuel projects in the G20 between 2019 and 2021. On the same day, EDC’s fellow ECA New Zealand Export Credit (NZEC) outlined a similar policy to cement its Cop26 commitment, including an end to support for fossil fuel exploration, extraction, transportation, storage and refining, as well as power plants and supporting infrastructure and services. Even for a party which is “in the fossil fuel energy sector” but carrying out an unrelated transaction, “applications may be considered only where that party has a documented and realistic transition plan consistent with a 1.5°C warming limit and the goals of the Paris Agreement [on combating climate change],” the NZEC policy says. The release of NZEC’s policy means there are only five governments that are yet to outline how they will meet their commitments to axing public finance for fossil fuels by the end of this year, according to Oil Change International: Germany, Italy, Portugal, Spain and Switzerland. Of these, Germany, Italy and Spain agreed earlier this year to publicise their plans to wind down ECA support for fossil fuels as part of the Export Finance for Future (E3F) alliance, but so far have not.

https://www.gtreview.com/news/global/canada-and-new-zealand-make-good-on-pledges...


Blocking a Carbon Bomb: Tiwi Islanders prevent $4.7 billion Barossa offshore gas project in Australia

(Oil Change International, Washington, 14 December 2022) In a landmark decision in September, the Federal Court of Australia ruled that Santos Ltd, one of the world’s top 20 largest oil and gas companies, would not be allowed to drill in the Barossa gas fields off the coast of northern Australia. The Court ruled that Santos had failed to consult Tiwi Traditional Owners. Santos appealed the decision, but this was in vain. Two weeks ago, the appeal was rejected, further solidifying legal victory for the Tiwi Islander Plaintiffs. The Barossa project alone included over $1 billion USD in public finance support from the Japanese and Korean governments’ export credit agencies (ECAs), Japan Bank for International Cooperation (JBIC), Export-Import Bank of Korea (KEXIM) and Korea Trade Insurance Corporation (K-Sure). Santos and the Australian Government assured these ECAs that the project approvals were solid, even after Tiwi Island people had warned them about lack of free, prior and informed consent, and despite the fact that extraction from these wells would be completely at odds with Australia’s climate obligations.

https://priceofoil.org/2022/12/14/blocking-a-carbon-bomb-tiwi-islanders-prevent-...


What ETMs can and can’t do for coal retirements

(TXF, London, 30 November 2022) The evolving science of coal plant retirement financing has had a busy couple of weeks with the Asia Development Bank signing a 14 November memorandum of understanding re potential early retirement of the Cirebon Electric Power for unit 1 of the 1,660MW Cirebon coal-fired plant, using the ADB’s Energy Transition Mechanism (ETM). The day after, on the sidelines of the same G20 summit where the Cirebon MOU was signed, the US, Indonesia and a raft of other developed countries launched the Just Energy Transition Partnership (JETP), a $20 billion combination of grants, concessional loans, commercial loans, ECA guarantees, and private investment. The programme will cover a big expansion in renewables, and the retirement of coal capacity whose emissions cannot be rebated. Aside from the summit-friendly but content-light announcements, there was further progress on the first coal retirement financing in Asia for a 244MW Philippino coal plant.

https://www.txfnews.com/articles/7473/What-ETMs-can-and-cant-do-for-coal-retirem...


Australia in talks to help PNG buy $1.1 bln PNG LNG stake

(Reuters, Sydney. 6 December 2022) Papua New Guinea's state-owned Kumul Petroleum is in talks with Australia's export credit agency to help fund a $1.1-billion acquisition of a 5% stake in the PNG LNG project from Santos Ltd (STO.AX). Santos announced in September that Kumul had made a binding offer to buy a 5% stake in PNG LNG from the company for $1.1 billion, subject to the other joint venture partners, which include ExxonMobil Corp and Japan's JX Holdings Inc, waiving their pre-emptive rights to match the offer.

https://www.reuters.com/business/energy/australia-talks-help-papua-new-guinea-bu...


Germany accelerates Europe’s “Neo-Scramble for Africa”

(TFI Global News, Noida Uttar Pradesh, 29 December 2023) German-African Business Association: Ever since the Russia-Ukraine war the importance of Africa has skyrocketed. Now every major power today wants to expand their footprint in the continent. Today there is a great surge of foreign interest in Africa. From the US, China, Russia to major European powers like France, UK and Germany, all want a decent share of influence in the African continent. However, are any of the powers actually interested in ensuring the well-being of Africa? The German-African Business Association says that it represents around 85% of German businesses active in Africa. It now wants the government to give greater support through improved conditions for export credit insurance and investment guarantees from the German government.

https://tfiglobalnews.com/2022/12/29/germany-accelerates-the-europes-neo-scrambl...


Germany suspends ECA guarantees for business with Iran amid protests

(Big News Network, Berlin, 29 December 2022) Germany announced that it is formally suspending export credits and investment guarantees for business in Iran, after the brutal crackdown on protests by authorities in Tehran. The instruments suspended are export credit guarantees, which protect German companies from losses due to unpaid exports, as well as investment guarantees, which aim to protect direct investments by German companies from political risk. These instruments for projects in Iran were suspended for decades until there was a "short phase of opening" from 2016, as a result of Iran's agreement with world powers, including Germany, on its nuclear program, the ministry said.

https://www.bignewsnetwork.com/news/273283920/germany-suspends-guarantees-for-bu...


Legal challenge over UK funding of Mozambique gas project goes to appeal court

(Drill or Drop, London, 6 December 2022) Government approval of $1.5bn financing for a liquified natural gas project in Mozambique has been challenged at the Court of Appeal this morning (Tuesday 5 December 2022). A year ago, a case brought by Friends of the Earth ended in deadlock, when two High Court judges disagreed on the verdict. The challenge was dismissed so that it could be heard again in the appeal court. Friends of the Earth will argue at the new hearing that the financing, through the government’s export credit agency, UK Export Finance (UKEF), was unlawful. It was permitted, the environmental organisation will say, after the project was incorrectly judged to be compatible with the Paris Agreement on climate change. Friends of the Earth has estimated that the facility would emit 4.5bn tonnes of greenhouse gases over its lifetime – more than the combined annual emissions of the 27 EU countries. The government has until March 2023 to revise its net zero strategy after losing a challenge by Friends of the Earth, ClientEarth and the Good Law Project. The high court ruled that the government should outline exactly how the net zero policies will achieve emissions targets. A decision is due early in 2023.

https://drillordrop.com/2022/12/06/legal-challenge-over-uk-funding-of-mozambique...


Who watches Czech state’s ECA obligations to big businesses?

(Paradise News, Calabar Nigeria, 10 December 2022) Czech state-owned ECA EGAP has obtained a CZK 2 billion (US$88.6M) loan from the Czech Republic’s COVID aid program for Czech steelmaker Liberty Ostrava, which is closely linked to Greensil, a company embroiled in corruption scandal. The Czech government’s COVID-19 aid to large polluters like Liberty Steel Ostrava, which is on the verge of bankruptcy, continues to be a cause for concern.The case is another illustration of the shortage of transparency and accountability in export credit agencies (ECAs). The COVID Plus program in the Czech Republic will provide hundreds of billions of dollars to large exporters, but there is no oversight or regulation. It is the job of the state to explain which projects it backs and give reasons for doing so, but EGAP remains mum on its questionable investments.

https://theparadise.ng/covid-inquiries-who-watches-the-czech-states-obligations-...


Are French ECAs ready to join early reconstruction of Ukraine?

(Odessa Journal, Odessa, 13 December 2022) French business is interested in investing in Ukraine and is ready to participate in its early reconstruction announced First Vice Prime Minister – Minister of Economy of Ukraine, Yuliya Svyridenko, during a live broadcast from Paris on the air of the National Telethon. "We discussed what tools we, as the Government, can use to ensure that French business enters the Ukrainian market and develops Ukraine even before our victory... We offer export credit agencies that provide insurance services for export operations to expand their services to insurance of investment activities and to insure their companies entering Ukraine. We have a list of investment projects and an understanding of their prioritization, and from their side, we have financing and companies ready to invest in Ukraine. And for us, the issue of military risk insurance is important. To help attract investments without waiting for the end of the war. War is not an obstacle to investment. This is a difficult period for us, but we will get through it,” Yulia Svyridenko assured.

https://odessa-journal.com/french-business-is-ready-to-join-the-early-reconstruc...


Poseidon Principles: [Only] 7 of 28 banks in line with IMO’s GHG reduction target

(Offshore Energy Biz, Schiedam, 15 December 2022) Out of the 28 financial institutions reporting their emissions data in the third edition of the Poseidon Principles Annual Disclosure Report 2022, seven banks are aligned with the IMO’s ambition of halving shipping’s GHG emissions by 2050. The Poseidon Principles are a global framework for assessing and disclosing the climate alignment of financial institutions’ shipping portfolios pioneered in 2019 by Citi, Societe Generale, and DNB with the support of the Global Maritime Forum. The voluntary regulatory framework aims to accelerate the implementation of the sector’s green agenda while charting a path forward for banks to decarbonize their own portfolios as well.

https://www.offshore-energy.biz/poseidon-principles-7-out-of-28-banks-in-line-wi...


Jaguar Land Rover lands UKEF-backed export loan

(Institute of Export and International Trade, London, 22 December 2022) In its end of 2022 report, the IEIT notes that UK Export Finance (UKEF) is backing 80% (£500m) of a loan by 12 banks that will support the research, development and export of the next range of battery-powered Range Rovers. Jaguar Land Rover is one of the UK’s largest exporters and employs more than 28,000 staff in the UK. In 2020-21, the company sold 439,588 vehicles in 127 countries, with about 80% of its sales to export markets outside the UK. UKEF backing worth £600 million will also help Ford to expand its electric vehicle production line.

https://www.export.org.uk/news/594264/Jaguar-Land-Rover-lands-UKEF-backed-export...


South African exporters assured Export Credit Insurance Corporation now has expanded cover

(Mail & Guardian, Johannesburg, 1 December 2022) African countries’ borders are becoming more porous, allowing for greater movement of goods and services via the African Continental Free Trade Area (AfCFTA) agreement, but by its nature this comes with a lot of risk. This is where export insurance comes in: to protect an exporter against a foreign buyer’s failure to pay for goods or services for political or commercial reasons. South African companies can count themselves lucky to have export insurance available to them through the Export Credit Insurance Corporation (ECIC), which is an official export credit agency, wholly owned by the Department of Trade, Industry and Competition. The AfCFTA is the perfect platform for cross-border trade and a number of opportunities exist. Substantial reduction of tariff and non-tariff barriers that will result from the implementation of AfCFTA will indeed increase intra-Africa trade and promote regional economic development. It is unacceptable that Africa, the second largest continental landmass after Asia, with all the resources, accounts for just 4.4% of world trade.

https://mg.co.za/special-reports/2022-12-01-south-african-exporters-can-rest-ass...


Chinese ECA sees underwriting growth of 9%

(Xinhua, Beijing, 26 December 2022) China's only policy-oriented insurer specializing in export credit insurance reported steady business growth in the first 11 months of 2022. The China Export & Credit Insurance Corporation, or SINOSURE, served about 179,000 clients in the January-November period, an increase of 14% year on year. During the period, the company handled underwriting for insured businesses worth a total of US$817.93 billion, up 8.6% year on year. SINOSURE is a state-funded and policy-oriented insurance company that promotes China's foreign economic and trade development and cooperation. It was officially launched and put into operation in 2001, and its service network now covers the whole country

https://english.news.cn/20221226/60c93ba833494ea89ab7a8fe2cfa5641/c.html


EU adopts new package of sanctions against Russia

(Brussels Times, Brussels, 17 December 2022) The Council of the European Union (Council of Ministers) adopted on Friday a package of new measures intended to step up pressure on Russia in response to its ‘continuing war of aggression against Ukraine and the gravity of the current escalation against civilians and civilian infrastructure’. The EU will reinforce the sanctioning of investments by additionally prohibiting new investments in the Russian mining sector, with the exception of mining and quarrying activities involving certain critical raw materials. Export credit guarantees for investments in Russia have already been covered by previous sanction packages.

https://www.brusselstimes.com/338832/eu-adopts-new-package-of-sanctions-against-...


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...


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