EBRD Trade Facilitation Programme (TFP) Czech-Asian Forum (March 2 nd, 2009 Prague)

Export Production Transport Storage & distribution Receivables EBRD Trade Facilitation Programme (TFP) Facilitates financing of all stages of the trade chain

Trade Facilitation Programme (TFP) Objectives Foster trade, both inter- and intra-regional Help local banks create track records with international banks Provide liquidity to the trade finance system Support the development of factoring services provided by banks and factoring companies Strengthen the trade finance capabilities of local banks

TFP – Two Main Components Trade Facilitation Programme (EUR 1.5 billion framework) Trade Finance Guarantee Facility (fully operational since 1999) Trade Finance Cash Facility (launched in 2000)

All types of goods, commodities and equipment, except for EBRD’s general exclusion list and environmental exclusion list Facilitated by: – L/C, SBLC and payment guarantees – trade-related promissory notes and bills of exchange – bid, performance bonds, contract guarantees – construction guarantees, leasing guarantees – credit card and other payment guarantees Types of Goods and Trade Finance Instruments

PRE-EXPORT AND WORKING CAPITAL FINANCE Local Company Local Bank (EBRD’s borrower) Takes local company risk Borrows from EBRD On-lends to the local company EBRD Takes local bank risk Lends to the local bank against sub-loan reports Repayment to EBRDEBRD’s disbursement Loan repaymentLoan disbursement

10 years of TFP Business Volumes p.a

774 Confirming Banks in 78 Countries Including 23 out of the world’s top 25 banks by total assets

Case Study: Export of Ethiopian Coffee to Armenia An Ethiopian exporter sells coffee to Armenia Armeconombank opens a confirmed Letter of Credit in favour of the Ethiopian exporter EBRD guarantees 100% of the political and commercial payment risk

Case Study: Export of wine from Moldova A Moldovan wine producer requires pre-export finance for purchase of agro-chemicals and equipment and export of wine to Russia EBRD grants a loan to a Moldovan bank which the bank can use to fund a loan to the Moldovan exporter (amount EUD 170,000, tenor 8 months)

EBRD’s Crisis Response Increase the TFP Programme limit from currently EUR 800 million to EUR 1.5 billion Increase existing TFP facilities Guarantee also deferred payments L/Cs, L/Cs with post-financing and advanced payment guarantees Provide liquidity also in form of cash facilities to Issuing Banks for trade finance transactions which cannot be funded by foreign commercial banks or export credit agencies (e.g. post-financing for import of capital goods, local distribution of imported goods, pre0export finance, trade between EBRD countries of operation, factoring)

TFP Achievements – Client Satisfaction Readers of Trade Finance Magazine and editors of Trade & Forfaiting Review have voted the EBRD “Best Development Bank in Trade” in 2003, 2004, 2005, 2006 and 2007 EBRD invites other development banks, commercial financial institutions, export credit agencies and donors to co-finance or co- finance with the EBRD

The Future Network of regional Trade Facilitation Programmes throughout the developing world, run by regional development banks like EBRD, ADB, IADB, IFC, FMO, DEG Increase trade by increasing trade finance permutations Leverage/increase trade volume by co-financing with commercial banks Established structure provides a mechanism for quick response to financial crisis

Contacts European Bank for Reconstruction and Development One Exchange Square London EC2A 2JN United Kingdom Tel: (Rebecca Suknenko) (Mirjana Zalar) (Yelena Tonna) Fax: / Financial Institutions - Trade Facilitation Programme (TFP)