2. UK Export Finance
Ozgur Kutay
Turkey, Eastern Europe and Central Asia

3. About UK Export Finance
We are the UK’s export credit agency, and a Government department.
Established in 1919 as the world’s first ECA and helping UK companies to export their goods and services overseas for nearly 100 years.
Our mission is to ensure that no viable UK export fails for lack of finance or insurance, working closely with colleagues in the Department for International Trade, both in the UK and globally.
We can support the export of goods, services and intangibles (i.e. equipment, engineering consultancy, design services etc).
We have a wide range of flexible support on offer and are actively looking for ways to help.
Our mandate ensures support worldwide and a risk appetite up to $50 billion, with capabilities in 60+ local currencies (Turkish Lira as well as a wide range from the region)
We work towards continued enhancement of economic relationships. We pioneered recent partnerships with GCC and Iraq, and other challenging jurisdictions.
We could also add that it’s the world first export credit agency supporting UK Exports for nearly 100 years 2

4. UKEF’s total capacity to support exports
UKEF: capacity
£27bn
UKEF’s remaining capacity to support exports
£50bn
UKEF’s total capacity to support exports
£23bn
The amount of its £50bn risk capacity it currently uses

5. Headline figures 2017/18
£2.5 billion in support of companies’ exports to 75 countries
77% of exporters benefiting from our support were SMEs
Supported more than £466 million in contracts value through our trade finance products – a total of £4.1 billion since these products were introduced in 2011
£14 billion of support provided over the last five years for UK exporters
We connected nearly 400 companies with 7 multinational contractors through our supplier fair programme

6. Trading with Uzbekistan: UKEF support
Up to £1.25 billion capacity to support trade with Uzbekistan – increased from £625 million following a market review in
In 2017, Baroness Fairhead, Minister for International Trade, announced a Memorandum of Understanding between UKEF, Uzbekneftegaz and the Uzbekistan Reconstruction and Development Fund to increase UK-Uzbekistan trade and support the oil and gas sectors in both countries.

7. Our range of support helps…
WIN CONTRACTS:
We offer long-term financing to overseas buyers that makes UK companies’ offerings more competitive, allowing buyers to spread their capital costs whilst exporters receive payment on delivery.
FULFIL CONTRACTS:
We can help your supply chain access working capital to fulfil export contracts, or reduce cash deposits required for contract bonds, enabling them to take on more contracts and increase turnover.
GET PAID:
We can help you and your supply chain manage risks in challenging markets with our insurance products, where the private market is not able to offer insurance.

8. Our products Finance Products Guarantee Schemes Insurance Products
Buyer Credit Guarantees
Provision of guarantees against bank loans to overseas buyers of UK exports for up to 85% of the contract value, enabling the buyer to pay on extended credit terms. Usually provided on a floating rate of interest.
Export Working Capital Scheme
A guarantee of up to 80% of the value of a working capital facility, to allow a bank to increase its capacity to lend to a UK exporter or Direct (Tier 1) Supplier to an exporter.
Bond Insurance Policy
Up to 100% insurance against a demand for payment under a bond, which is either unfair or caused by political events.
Export Insurance Policy
Up to 95% insurance against the risk of not being paid, either due to default by the buyer, or due to specified political, economic or administrative events
Direct Lending Facility
Provision of loans directly (working with a bank as an agent) to overseas buyers of UK exports for up to 85% of the contract value, enabling the buyer to pay on extended credit terms. Total fund size - £3bn. Usually provided at the fixed OECD Commercial Interest Reference Rate.
Bond Support Scheme
A guarantee of up to 80% of the value of a contract bond to enable a bank to issue a bond without requiring as much of the exporter’s cash as collateral, or to issue more bonds on behalf of the exporter or Direct (Tier 1) Supplier to an exporter.
Overseas Investment Insurance
Up to 90% political risk insurance for UK overseas investors against risks, which include war, terrorism, expropriation, nationalisation, restrictions on remittances eg. exchange controls.
Supplier Credit Finance
Simpler financing package, which guarantees bank lending to an overseas buyer. Can be used for contracts of less than £5m. The bank takes the documentation risk. Usually provided on a floating rate of interest.

9. Innovative support for project buyers
Our long-term financing, in the form of direct loans and 100% unconditional guarantees, allows buyers to spread the cost of purchases of capital goods and services from the UK
Repayment terms of 2-10 years (extending to 14 for project finance and 18 for renewables)
Support for up to 85% of total contract value, provided there is a minimum of 20% UK content
Financing in a range of 60+ currencies
Flexibility to meet your requirements, including innovative products such as capital markets refinancing and Islamic financing
UKEF charges a premium for its support based on OECD rates and calculated on a case by case basis, taking into account factors such as credit risk and loan tenor
Premium is paid upfront, and can be funded from the loan to spread the cost
Premium is a one-off charge, and is separate from the interest charged on the loan

10. Helping UK exporters fulfil contracts and get paid
UKEF can help companies access the trade finance they need to fulfil a contract, giving them the ability to take on more contracts and increase their turnover. We can offer:
Export finance guidance
Guarantees of up to 80% to UK companies’ banks who lend working capital for export orders
We can also guarantee contract bonds up to 80%, freeing up working capital for exporters
We can help exporters manage risks in challenging markets, ensuring that they get paid even where the private market is not able to offer insurance. We can offer:
Insurance against non-payment
If the buyer does not pay or the contract is cancelled, the exporter is covered under our policy

11. Sector spotlight: Infrastructure
UKEF is able to support major infrastructure projects, for example:
Transport infrastructure:
Airport terminals
Rail – with repayment terms up to 14 years
Roads
Ports
Urban:
Buildings
Stadiums
Education – universities, equipment, expertise
Healthcare – hospitals, equipment & expertise
Smart cities technology
UK Export Finance supported Kier, a leading UK construction company, in a contract to design and develop the 17,000-seater Dubai Arena. UKEF provided Meraas Holding, the project sponsors, with US$220m in finance through a mix of buyer credit and direct lending

12. Sector spotlight: Energy
The UK has considerable expertise in the energy sector, and UKEF has been involved in a large number of projects including:
Upstream & downstream, oil, gas and renewables
Long-term loans (up to 18 years) available in renewable energy sector
Offshore & onshore
Value capture in the hydrocarbon market, e.g. petrochemicals
UK Export Finance guaranteed a US$870m loan for the US$19bn Sadara petrochemical project in Saudi Arabia, supporting exporters including Foster Wheeler, Jacobs, and Fluor.

13. Case study: Liwa Plastics
UKEF provided a US$157 million in support for the US$ 6.4 billion Orpic Liwa Plastics project, which includes:
Gas extraction facility
300km pipeline
New petrochemical plant to convert gas to plastics products
Supported CB&I UK, UK subsidiary of EPC contractor CB&I Netherlands

14. Case study: Power Stations in Angola
In 2018 UKEF provided a guarantee to support a €70 million loan issued to the Angolan Ministry of Finance to upgrade two power stations in Viana and Gabela.
The contract to deliver the work went to Paisley-based IQA Group, the UK arm of Spanish multinational Elecnor.
The project will have a transformative effect on the region’s power network, giving thousands of Luanda’s residents, as well as industry in the region, improved access to electricity to support economic growth and development.
“Support from UK Export Finance is a central part of our international offer, and is supporting our operations and jobs in Scotland.”
Gregory Smith, Managing Director, IQA Group

15. Creating export opportunities
UKEF financing makes the UK an attractive business partner:
Export contract negotiations – exporter bid includes expression of interest
Project sponsors and EPC contractors
UK exporters and consortium partners
Working capital and bonding products
Buyer finance products
Posts to source opportunities
UKEF to engage with UK exporters
Sector teams interrogate UK supply chain
UKEF
Expression of interest
EoI
DIT/FCO in Post
Posts keep sector teams and UKEF informed of opportunities
DIT industry sector teams
Sector teams to identify UK supply chain for overseas projects 15 15

16. Supplier fairs in practice
UKEF support for Enka UK UKEF provided US$620 million in support for two critical power projects in Iraq, to be delivered by the UK arm of Turkey’s Enka as part of a GE-led consortium.
To help Enka broaden and deepen its UK supply chain, UKEF arranged a supplier fair in March 2017 to source US$250 million in UK goods and services to deliver the projects.
Access to UKEF finance was critical to the Government of Iraq’s decision to award the contract.
“We are very pleased to see UK Export Finance, the leading ECA active in Iraq, supporting these projects. It would not have been possible for us to enter into these projects with GE without their support. These projects will help the people in the country by increasing the electrification rate while providing great opportunities for UK exporters of goods and services to participate in these transformational projects in Iraq.”
Yavuz Akturk, Director, Enka

17. Any questions?