ANNOUNCEMENT 03 Jan 2013In January 2013, the government of Pakistan announced a change in its trade finance instruments.
NUMBER OF INTERVENTIONS
On 3 January 2013, the State Bank of Pakistan introduced the Export Finance Facility for Locally Manufactured Goods (EFF-LMM) to promote the export of locally manufactured machinery.
Credit is available under this facility at both the pre-shipment and post-shipment stages. The maximum tenure of finance is fixed at 5 years while the rate of interest is as applicable on the SBP's Long Term Financing Facility for plant & machinery. To promote financing to the non-traditional exporters, the bank's are given a higher spread on such financing.
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