- Region: Asia
- Machinery and Equipment
- Export Loans
October 20, 2014
The Japan Bank for International Cooperation (JBIC; Governor: Hiroshi Watanabe) signed on October 17 a buyer's credit (export loan) agreement totaling up to about USD696 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 Bank of Tokyo-Mitsubishi UFJ, Ltd., Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation and the Tokyo branch of Deutsche Bank AG, with the total cofinancing amount reaching about USD1.16 billion. Nippon Export and Investment Insurance (NEXI) will provide insurance for the portion cofinanced by private financial institutions.
This loan will fund the purchase of a whole set of plant facilities by the State Concern "Turkmenhimiya," Turkmenistan's state-owned petrochemical company, from Mitsubishi Corporation and other companies, as it constructs a new chemical fertilizer production plant for producing ammonia and urea fertilizer by using natural gas as raw material in Garabogaz City, Balkan Province located in western Turkmenistan.
The product produced from this plant is expected to be exported and sold primarily overseas and thereby contributes to the development of Turkmenistan's chemical sector. In Turkmenistan, which has sustained high economic growth rate by promoting the diversification of the energy sector, there is the prospect of demand for constructing new plants in the oil and natural gas industry sector. Thus, JBIC's support with this loan for the export of a chemical fertilizer plant by a Japanese company will lead to creating business opportunities for Japanese companies in this sector in Turkmenistan, thereby contributing to maintaining and strengthening the international competitiveness of Japanese industries.
As Japan's policy-based financial institution, JBIC will continue to support the export of machinery and equipment for plants and overseas business deployment by Japanese companies, by drawing on its various financial facilities and schemes for structuring projects, and performing its risk-assuming function.