ANNOUNCEMENT 25 Oct 2012
On 24 October 2012, JBIC signed an overseas investment loan agreement with Gulf JP UT Co., Ltd. in project financing.
NUMBER OF INTERVENTIONS
The Japan Bank for International Cooperation, press release of 25 October 2012, Project Financing for Utai Natural Gas-Fired Combined Cycle Power Plant in Thailand: http://www.jbic.go.jp/en/information/press/press-2012/1025-7468
JBIC information on overseas investment loans: http://www.jbic.go.jp/en/finance/investment
The overseas investment loan agreement in project financing between JBIC and Gulf JP UT Co., Ltd has a maximum value of USD 284 million. The company Gulf JP UT Co. is a subsidiary of Japanese Electric Power Development Co., Ltd.
The loan finances the subsidiary's project in Thailand involving the building and operation of a natural gas-fired combined cycle power plant. The electricity generated from this plant will be sold by the company to the Electricity Generating Authority of Thailand for a period of 25 years.
In this context, the Bank stated: "... JBIC will support the overseas infrastructure business activities of Japanese companies through project structuring and risk taking by drawing on its range of financial instruments and schemes, and contribute to maintaining and improving the international competitiveness of Japanese industries."
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.
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.