ANNOUNCEMENT 05 Aug 2009In August 2009, the government of Canada announced a change in its trade finance instruments.
NUMBER OF INTERVENTIONS
Department of Foreign Affairs and International Trade, Government of Canada Provides Support to Bombardier, 5 August 2009, http://w01.international.gc.ca/MinPub/Publication.aspx?lang=eng&publication_id=387446&docnum=215
On 5 August 2009, the Canadian Government announced that it would be providing up to CAD173 million in loans to Bombardier Inc. in order to "help it complete and deliver an order for up to eight of its Q400 and CRJ900 to Sweden's Scandinavian Airlines (SAS)." The repayable loans will be provided through Export Development Canada (EDC). EDC is Canada's export credit agency; its sole shareholder is the Department of Finance. The repayable loans are conditional on Bombardier and SAS coming to an agreement on the terms of sale for the planes and will be provided under the Canada Account.
The Canada Account is a special funding facility that permits EDC to fund specific projects that it would be otherwise unable to support but that the Minister of International Trade deems to be in the national interests of Canada. Although EDC administers all loans granted under the Canada Account in the same way as loans issued under the Corporate Account (which are granted according to the corporation's loan and risk rules), the Government of Canada assumes all risk related to the loans. Transactions completed under the Canada Account must be approved by the Minister of Finance, and those of a value exceeding CAD50 million are also approved by Cabinet. EDC discloses the parties to these transactions, their approximate value, the general purpose of the transactions and the principal financial counterparties, but not the terms of the loans or guarantees. Details of previous financial products issued under the Canada Account are available on http://www.edc.ca/english/disclosure_9239.htm
Bombardier Inc. is Canada's largest aircraft producer and the third-largest civilian aircraft producer in the world, with a specialization in small and regional jets. It is estimated that the company employs approximately 17 000 people in Canada.