|
EBRD trade programme exceeds €1 billion threshold
Deal to secure rail cargo lifts business to new record
What do exports of Lithuanian butter to Uzbekistan, the sale of Italian pasta-making equipment to Siberia and the delivery of wheat from Kazakhstan to Madeira have in common? Every one of these deals was finalised thanks to the EBRD's Trade Facilitation Programme (TFP), an innovative facility to help east European entrepreneurs expand their import and export trade. The fast-growing programme recently tipped the €1 billion mark for volume financed with a cover to secure payments for rail cargo services between partners in Kazakhstan and the Kyrgyz Republic.
Established in 1999, TFP assists participating banks in building track records with their correspondent banks, reducing cash collateral requirements and freeing clients' working capital by guaranteeing the payment of various trade finance instruments issued by local banks. The programme enables trade which otherwise could not be realised: a Letter of Credit for butter export issued by bank in Uzbekistan was confirmed by a Lithuanian bank only after the EBRD guaranteed it.
In 2002 TFP had its best year so far, with volume rising 27 per cent to €369 million, and the number of transactions rising from 368 in 2001 to 676. The programme now includes 74 issuing banks in 20 countries of operations and 435 confirming banks in 62 countries across the world. Rogers LeBaron, Director of Bank Lending at the EBRD, said this comprehensive network of issuing and confirming banks efficiently supports a very broad range of trade flow to, from and within the region. Business Group Director Olivier Descamps added that in certain cases, such as in Macedonia in 2001, the TFP has proved to be a very valuable instrument enabling entrepreneurs to continue their businesses even during the time of the recent crisis.
Most TFP transactions are between small and medium-seized enterprises, enhancing job creation and cooperation between countries in and outside the region, helping restoration of traditional trade links and supporting all kinds of products, including, for example, the export of construction equipment from Poland to Moldova, tank railcars from Ukraine to Azerbaijan, pharmaceutical products from Hungary to Russia, Skoda passenger cars from the Czech Republic to Moldova and Azerbaijan, galvanised metal coils from Slovenia to Ukraine, and the sale of a Russian oil rig to Norway.
The opportunities and challenges for cross-border economic and commercial cooperation will be discussed at the forthcoming EBRD Annual Meeting on 4-5 May in Tashkent in a workshop titled "Trading places, placing trade".
The EBRD has a network of offices in all its 27 countries of operations ready to assist in trade financing. At the Bank's headquarters in London please contact:
Yelena Tonna/Madina Sakbaeva
Tel: +44 20 7338 6813/ +44 20 7338 6476
Fax: +44 20 7338 6119
E-mail: tonnay@ebrd.com / sakbaevm@ebrd.com
European Bank for Reconstruction and Development, One Exchange Square, London EC2A 2JN, UK
|
