- Region: Others
The Japan Bank for International Cooperation (JBIC, Governor: MAEDA Tadashi) today announced its business results for FY2020 as outlined below. Details of the business results by region and financial instrument as well as changes in the results over the last five years are shown in the appendices attached to this press release.
I. Overview of Business Results for FY2020
■In FY2020, JBIC made financial commitments totaling approximately JPY2,599.3 billion in loans, equity participation and guarantees, an increase of 54.8% from the previous year.
■Outstanding loans and equity participation totaled approximately JPY13,906.5 billion and outstanding guarantees were approximately JPY1,838.3 billion as of March 31, 2021, with the total outstanding amount for those financial instruments reaching approximately JPY15,744.8 billion.
II. Business Highlights
The spread of COVID-19, which became a pandemic in 2020, raised concerns over economic impact in Japan and overseas. It prompted JBIC to establish a new window named the Emergency Window for Overcoming the COVID-19 Crisis (“COVID-19 Emergency Window”)*1 in April 2020 under the Growth Investment Facility, which had already been launched in order to provide wide-ranging support in assisting Japanese companies in the overseas expansion of their businesses and development of quality infrastructure.
In January 2021, JBIC restructured the Growth Investment Facility and established an enhanced facility named the Post-COVID-19 Growth Facility*2 as part of the Comprehensive Economic Measures to Secure People’s Lives and Livelihoods toward Relief and Hope (December 8, Cabinet decision) and the Green Growth Strategy Through Achieving Carbon Neutrality in 2050 (formulated by the Ministry of Economy, Trade and Industry, and reported at a meeting of the Committee on the Growth Strategy on December 25, 2020). With the purpose of transforming the economic structure and realizing a virtuous circle for the post-COVID-19 era, JBIC supported Japanese companies in the overseas expansion of high-quality infrastructure toward a decarbonized society and the enhancement of supply chain resilience.
1．Promoting Overseas Development and Acquisition of Important Resources for Japan
As Japan depends on imports from overseas for most of its resources, it is an important challenge that the country secures a stable supply of energy and mineral resources in the medium to long term by increasing its self-development ratio of those resources. JBIC contributes toward securing a long-term stable supply of resources through financial support for acquisition of upstream interests in resources development, diversification of supply sources and strengthening of relationships with resource-rich countries. In FY2020, JBIC made a total of nine financial commitments in the resource sector, amounting to approximately JPY507.7 billion in loans and guarantees. These commitments include a loan for a gas field development and LNG production project in Mozambique in which Japanese companies participate.
2．Maintaining and Increasing International Competitiveness of Japanese Industries
Amid a growing movement by Japanese industries to seek earnings opportunities outside Japan due to declining domestic demand, JBIC supports Japanese companies, through its various financial instruments, in implementing their overseas business as well as maintaining and strengthening their global supply chains, thereby contributing toward maintaining and increasing the international competitiveness of Japanese industries. In this business field, JBIC made a total of 164 financial commitments amounting to approximately JPY1,475.3 billion in loans, equity participation and guarantees in FY2020.
(1) Support for Strategic Overseas Business Expansion of Japanese Companies
(1)Financing Overseas Investments by Japanese Companies
JBIC supported M&A transactions by Japanese companies through providing loans for the acquisition of a Swiss power grids business and an Australian paperboard and fiber based packaging business. JBIC also provided loans for infrastructure projects in which Japanese companies participate, including a natural gas-fired combined cycle power plant project in Bangladesh and an offshore electricity transmission project in the United Kingdom. In addition, JBIC made joint investments with Japanese companies in a business to provide ancillary services to adjust electric power supply in Ireland, a hydrogen station operator in the United States, and an electric utility in Fiji. In terms of supporting the enhancement of supply chain resilience of Japanese companies, JBIC provided, through India’s state-owned commercial bank, the funds necessary for suppliers and dealers of Japanese automobile manufacturers and for sales finance of Japanese automobiles in India.
(2)Financing Exports by Japanese Companies
JBIC supported Japanese companies in exporting submarine cable-related equipment to Palau and construction machinery to Mongolia.
(2) Support for Overseas Expansion of Japanese MTEs and SMEs
To assist Japanese mid-tier enterprises (MTEs) and small- and medium-sized enterprises (SMEs) in expanding overseas, JBIC made a total of 113 financial commitments, aggregating approximately JPY26.2 billion, in co-financing with Japanese regional financial institutions. The support included loans for a packaging materials manufacturing and sales business in Thailand and a heat treatment business in China. In addition, JBIC, in cooperation with Japanese regional financial institutions, hosted various seminars and events to provide information that might help Japanese companies expand overseas as well as opportunities for business matching.
3．Supporting Projects in the Environmental Sector
Under its GREEN Operations*3, JBIC signed loan agreements to set up credit lines with local financial institutions to finance environmental preservation projects in Benin and renewable energy projects and energy efficiency projects in Turkey. JBIC made a total of seven financial commitments amounting to approximately JPY168.7 billion in FY2020 under this framework.
To support the overseas expansion of high-quality infrastructure and overseas business activities toward a decarbonized society, JBIC provided project financing for a waste to energy project in the Emirate of Dubai, UAE, and a solar PV project in the Kingdom of Saudi Arabia, both invested in by Japanese companies.
4．Other Financing Support
JBIC provided 37 local currency denominated loans*4 totaling the equivalent of approximately JPY171.6 billion. The loans included a South African rand loan to fund a Japanese company’s manufacturing and sales business of automotive tires and a Russian ruble loan to fund another Japanese company’s automobile logistics business.
In FY2020, JBIC made a total of 186 financial commitments under the Growth Investment Facility*5, amounting to approximately JPY1,950.5 billion, and nine financial commitments under the Post-COVID-19 Growth Facility, amounting to approximately JPY318.0 billion, both in loans and guarantees.
The financial commitments made under the Growth Investment Facility as of December 2020 are under the facility prior to its restructuring. Prior to the restructuring, the Growth Investment Facility consisted of three windows: the Facility Window for the Development of Quality Infrastructure for Environmental Preservation and Sustainable Growth (the QI-ESG Window), the Facility Window for Supporting Japanese Companies’ Overseas Business Expansion (the Overseas Business Expansion Window), and the Emergency Window for Overcoming the COVID-19 Crisis (the COVID-19 Emergency Window).