On 19 February 2010, the Japan Bank for International Cooperation (JBIC) signed a USD 30 million overseas investment loan agreement with Chinese Lingyou Engineering-Plastics (Shanghai) Co. The company is a joint venture between the two Japanese companies Mitsubishi Gas Chemical Company (MGC) and Mitsubishi Engineering-Plastics Corporation (MEP). The loan will finance the Chinese company's construction of a polycarbonate production facility in the Shanghai Chemical Industry Park, China. The estimated annual 80,000 tons polycarbonate produced at this facility will be sold in China by MEP's Chinese subsidiaries.
 
In this context the Bank highlighted its reason to support this business activity: 'To date, MGC has exported polycarbonate produced in domestic and Southeast Asian plants to the Chinese market. However, as its foreign rival firms have been increasing investments in China and expanding their local production capacities, MGC has decided to build its first polycarbonate production facility in China to strengthen its competitiveness by locating a production site close to the market with its sights set on the expanding Chinese market.'
JBIC hereto concluded: 'As further growth is foreseen in China's polycarbonate market, this loan, extended directly to MGC's Chinese subsidiary, will support the overseas business development of MGC.JBIC is committed to supporting Japanese firms to maintain and improve their international competitiveness by drawing on a range of financial instruments and schemes.'
 
Overseas investment loans
JBIC provides direct loans named overseas investment loans to Japanese companies, overseas affiliates or joint ventures where Japanese companies hold equity interests and governments or financial institutions partying with such overseas affiliates. Loans support projects in specific sectors or with a specific purpose of interest to Japan. Further information can be found on the Bank's website under overseas investment loans.
 
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.