IMPLEMENTATION LEVEL

NFI

AFFECTED FLOW

Outflow (subsidised)

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

firm-specific

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 09 Aug 2010 | Removal date: open ended
Still in force

Trade finance

On 9 August, the Japan Bank for International Cooperation (JBIC) signed a USD 900 million buyer's credit loan agreement with the Egyptian Refining Company (TAKRIR) S.A.E. (ERC) in project financing. A number of commercial banks additionally co-financed the loan with Japanese governmental agency Nippon Export and Investment Insurance (NEXI) providing insurance for the co-financed portion.

The loan will finance the Egyptian company's project to construct and operate processing units for refining atmospheric residue. The construction of the new processing units will be undertaken by a joint venture consisting of among others Japanese Mitsui & Co., Ltd. The Japanese company will here supply plant facilities and machinery for the project.
 
In this context the JBIC stated: 'To create export opportunities for Japanese industries, JBIC will continue its support for Japanese overseas business activities by drawing on its expertise, risk-assuming function and wide range of financial instruments.'
 
Buyer's credit agreements
JBIC provides direct loans named buyer's credit to overseas importers. Loans are obtained if it finances the purchase of Japanese machinery, equipment or technology in specific eligible sectors. The Bank hereto stated that these loans are intended to 'positively contribute to Japanese companies'. Further information can be found on the Bank's website under export loans.
 
Project finance
Project financing loans include preferential terms such as repayments being solely made from the project's cash flow generation and secured on the basis of the project's assets alone. As such the loan agreement is tied to the project's finances and not the company in question.
The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.
 
According to UN Comtrade, no trading partner exceeded the GTA threshold of USD 1 million on the affected tariff line 8419 in the year prior to the intervention. Thus, no affected trading partners have been identified.

AFFECTED COUNTRIES

MAP
TABLE
EXPORT

AFFECTED SECTORS AND PRODUCTS

439 Other general-purpose machinery & parts
8419 Machinery, plant or laboratory equipment, whether or not electrically heated (excluding furnaces, ovens and other equipment of heading 85.14), for the treatment of materials by a process involving a change of temperature such as heating, cooking, roasting
841940 Distilling or rectifying plant
841950 Heat exchange units
841960 Machinery for liquefying air or other gases
841989 Other
841990 Parts
445 Machinery for food, beverage & tobacco processing; parts
8419 Machinery, plant or laboratory equipment, whether or not electrically heated (excluding furnaces, ovens and other equipment of heading 85.14), for the treatment of materials by a process involving a change of temperature such as heating, cooking, roasting
841931 For agricultural products
841981 For making hot drinks or for cooking or heating food
448 Domestic appliances & parts
8419 Machinery, plant or laboratory equipment, whether or not electrically heated (excluding furnaces, ovens and other equipment of heading 85.14), for the treatment of materials by a process involving a change of temperature such as heating, cooking, roasting
841911 Instantaneous gas water heaters
841919 Other
449 Other special-purpose machinery & parts
8419 Machinery, plant or laboratory equipment, whether or not electrically heated (excluding furnaces, ovens and other equipment of heading 85.14), for the treatment of materials by a process involving a change of temperature such as heating, cooking, roasting
841932 For wood, paper pulp, paper or paperboard
841939 Other
481 Medical & surgical equipment & orthopaedic appliances
8419 Machinery, plant or laboratory equipment, whether or not electrically heated (excluding furnaces, ovens and other equipment of heading 85.14), for the treatment of materials by a process involving a change of temperature such as heating, cooking, roasting
841920 Medical, surgical or laboratory sterilisers

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