ANNOUNCEMENT 19 Jul 2013
On 19 July 2013, the Japan Bank for International Cooperation (JBIC) signed an overseas investment loan agreement with Muscat City Desalination Company S.A.O.C. in project financing.
NUMBER OF INTERVENTIONS
The Japan Bank for International Cooperation, press release of 19 July 2013, Project Financing for Al Ghubrah Seawater Desalination Project in Oman: http://www.jbic.go.jp/en/information/press/press-2013/0726-7546
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 the Omani company Muscat City Desalination Company S.A.O.C. has a maximum value of USD 105 million. The company is jointly established by the Japanese company Sumitomo Corporation and the two foreign companies Malakoff Corporation Berhad and Cadagua, S.A.
The loan finances the Muscat City Desalination Company's project to build a new seawater desalination plant and sell the desalinated water to the state-owned Oman Power and Water Procurement Company S.A.O.C.
In this context, the Bank stated: "As a public financial institution, JBIC will, in its capacity of an official financial institution, continue to support overseas infrastructure business activities of Japanese companies by drawing on its various financial facilities and schemes for structuring projects, and performing its risk-assuming function."
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.