Individual Agreement Based on Export Credit Line for Mongolia
Supporting Exports of Construction Machinery by Japanese Companies to Mongolia

• Region: Asia
• Machinery and Equipment
• Export Loans

1. The Japan Bank for International Cooperation (JBIC; Governor: MAEDA Tadashi) signed on December 24 a loan agreement in the amount of up to approximately JPY600 million (JBIC portion) based on a credit line^*1 extended to the Government of Mongolia in June 2013. The loan is co-financed with MUFG Bank, Ltd. (lead arranger), bringing the total co-financing amount to approximately JPY1.3 billion.Nippon Export and Investment Insurance (NEXI) will provide the insurance for the loan by the private financial institution.
     
2. The loan is intended to provide, through the Ministry of Finance of Mongolia, the funds required by Erdenes Mongol LLC, a Mongolian company, to purchase construction machinery made by Komatsu Ltd. and related services from SUMITOMO CORPORATION.
     
3. Based on the “Agreement between Japan and Mongolia for an Economic Partnership (EPA)” enacted in June 2016, discussions between the Governments of Japan and Mongolia have been ongoing, which is expected to further enhance reciprocal economic cooperation, including the promotion of trade. Also, the “Japan-Mongolia Mid-term Action Plan for a Strategic Partnership^*2 ” signed by the two Governments in March 2017 emphasizes appropriate utilization of the credit line. The loan is in line with such measures enacted by the two countries, and through the promotion of Japanese exports, it will contribute toward maintaining and improving the international competitiveness of Japanese industry as well as strengthening the Mongolian economy.
   
   
4. As Japan’s policy-based financial institution, JBIC will continue to financially support the export of machinery and equipment and the overseas business expansion of Japanese companies to foreign countries, including Mongolia, by drawing on its various financial facilities and schemes for structuring projects and by performing its risk-assuming function.
     

Note

1. *1 
   See Press Release on June 6, 2013.
2. *2 
   The mid-term action plan was agreed upon by both Governments upon Mr. Enkhbold, Chairman of the State Great Hural (Parliament) of Mongolia, and Foreign Minister Munkh-Orgil's visit to Japan in March 2017, as a roadmap for Japan-Mongolia relations for 2017 to 2021.