ANNOUNCEMENT 09 Feb 2010In February 2010, the government of Denmark announced a change in its trade finance instruments.
NUMBER OF INTERVENTIONS
Letter from the EC to Denmark, 09.02.2010
Press release by the EC on 09.02.2010
Letter from the EC to Denmark, 11.01.2012
On 9 February 2010, the European Commission approved the Danish state financing programme for long-term export loans, also known as the ELO scheme. It "provides financing on commercial terms for clients of Danish exporters in compliance with the OECD Arrangement" and shall be conducted by the Danish export export finance agency EKF.
The budget is estimated at 2.7 billion EUR which will be made available for loans with a tenor of at least 2 years. EKF will guarantee up to 90-95% of the loans.
According to the Danish authorities, "Albeit the widespread State support for banks during the crisis both in Europe and the US, banks have not restored their appetite for large long maturity loans (typically the case of export loans). The banks' restricted activity in long term export loans is due to a general unwillingness in committing funding for maturities longer than 3 to 5 years rather than a matter of risk aversion, since these loans are guaranteed by the Danish State-owned export finance agency, Eksport Kredit Fonden (EKF)." (par. 6)
The scheme was initially planned until 31 December 2011 but was extended by state aid regulation SA.33844 (cf. Sources) for another four years.
The list of potentially affected trading partners and tariff lines is based on Denmark's bilateral export flows in 2009 with the countries the EU classifies as marketable risk countries (i.e. either OECD or EU member states).