- Region: Asia
- Machinery and Equipment
- Export Loans
May 30, 2014
The Japan Bank for International Cooperation (JBIC; Governor: Hiroshi Watanabe) signed on May 29, a buyer's credit (export loan) agreement totaling up to USD438 million (JBIC portion) with the Government of Turkmenistan acting through the State Bank for Foreign Economic Affairs of Turkmenistan (TVEB). The loan is cofinanced with the Tokyo Branch of Deutsche Bank AG, Sumitomo Mitsui Banking Corporation, Mizuho Bank, Ltd. and The Bank of Tokyo-Mitsubishi UFJ, Ltd. with Nippon Export and Investment Insurance (NEXI) providing insurance for the cofinanced portion. The total cofinancing amount reaches about USD730 million.
The loan is intended to finance the State Concern "Turkmengaz", Turkmenistan's state-owned gas company, to purchase a set of plant facilities from Toyo Engineering Corporation, as it builds a new ethylene plant complex for the production of high density polyethylene and polypropylene*1 from natural gas in Balkan Region, Turkmenbashi District in western Turkmenistan. JBIC provides the fund for a gas separation unit, ethane cracker and polypropylene production facilities to be built by Toyo Engineering.
Turkmenistan sustains high economic growth and is following the strategy of diversification of energy sector. The products from the plant will be exported and sold mostly in Asian, European and Turkish markets, and is expected to contribute to the development of Turkmenistan's chemical industry sector. While demand for construction of new plants in the oil and gas sector is expected to continue in Turkmenistan, JBIC's support for Japanese companies' ethylene complex facility export with this loan will lead to creating business opportunities for Japanese companies in the oil and gas sector, thereby contributing to maintaining and improving the international competitiveness of Japanese industry.
As Japan's policy-based financial institution, JBIC will continue to support Japanese companies for their export of plant machinery and equipment, as well as their overseas business deployment, by drawing on its various financial facilities and schemes for structuring projects and performing its risk-assuming function.
- *1 High density polyethylene and polypropylene are one of the major materials for plastic products and used for automobile parts, electric appliances, packaging films, food containers and others.