- Region: The Middle East
- Machinery and Equipment
- Export Loans
October 9, 2012
- The Japan Bank for International Cooperation (JBIC; Governor: Hiroshi Okuda) signed on October 5, a general agreement with Turkiye Is Bankasi A.S. (Isbank), the largest commercial bank in terms of assets in Turkey, for offering an export credit line*1 amounting to the equivalent of 120 million U.S. dollars (JBIC portion) to finance Japanese exports to Turkey and its neighboring countries (including in the Middle East, Central Asia and North Africa). The credit line is cofinanced with private financial institutions*2, which brings the overall cofinancing amount to the equivalent of 200 million U.S. dollars.
- Under this agreement, an export credit line is set up for Isbank to extend loans to local companies in Turkey and its neighboring countries for the purchase of Japanese machinery and equipment, such as construction machinery. This export credit line will thus provide medium- and long-term loans to these companies, either in yen or in U.S. dollars, through Isbank, thus supporting the expansion of the export of Japanese machinery and equipment to these countries.
- In recent years, there have been growing expectations for Japanese exports of machinery and equipment to Turkey and its neighboring countries through collaboration between Japanese and Turkish companies. In particular, both the Japanese and Turkish governments have been making consultations to promote joint business in the Republic of Iraq*3. Under these circumstances, there has been growing interest in a variety of export businesses (including exports of construction machinery, and other infrastructure-related machinery and equipment) and expectations on the major role JBIC should play therein. This credit line will support the export of machinery and equipment to Turkey and its neighboring countries, thereby contributing to maintaining and improving the international competitiveness of Japanese industries.
- JBIC and Isbank have built close cooperative ties over the years with bank loans that supported the export of ships built in Japanese shipyards. JBIC will continue to support Japanese companies' export of machinery and equipment in collaboration with such foreign financial institutions by drawing on its various financial facilities and schemes for structuring projects, and performing its risk-assuming function.
- *1 An export credit line is a form of export credit in which JBIC makes a commitment of the maximum amount of credit to be extended to a foreign banks or other entities to finance the export of machinery and equipment from Japan.
- *2 Nippon Export and Investment Insurance (NEXI) will provide Buyer's Credit Insurance for the portion cofinanced by private financial institutions.
- *3 In July 2012, the Japanese and Turkish governments jointly held a business forum for advancing business in Iraq through collaboration between Turkish and Japanese firms.