VALET Webinar: Utilizing U.S. Export Finance Programs Wednesday, November 14, 2012 2:00 p.m. to 3:30...

VALET Webinar: Utilizing U.S. Export Finance Programs

Wednesday, November 14, 20122:00 p.m. to 3:30 p.m.


Agency Introductions

•Bill Houck, Regional Manager (DC ,VA, WV, MD, DE, PA), Export Solutions Group, Office of International Trade, United States Small Business Administration (SBA)

•Leila Afas, Director, Export Promotion, United States Trade and Development Agency (USTDA)

•Michael Jackson, Director, City/State & Trade Association Partners, Export-Import Bank of the United States

•Brian O’Hanlon, Director and Coordinator, Business Development Insurance, Overseas Private Investment Corporation (OPIC)

Panel Questions (Session open to audience questions and input)

Bill Houck, Regional Manager(DC,VA,WV,MD,DE,PA)

Export Solutions GroupOffice of International Trade

[email protected]+1 202-557-4063

Export Loan Guarantee Programs

mailto:[email protected]

SBA

Ex-Im BankUS

CommercialService(USCS)

US Export Assistance Center (USEAC)

USCS- Market analysis-Match making-Buyer due diligence

SBA-Export activity working capital-Transaction working capital-Fixed asset and real estate term loans

Ex-Im Bank-Export working capital-Credit insurance

US Export Assistance Center

Start: US Commercial Service assists in originating export sales

To

Finish: SBA and Ex-Im assist in financing export sales, turning an order into a completed export sale

Export Express– 90% guarantee for amounts up to $350,000 (for up to 7 years)– 75% guarantee for amounts between $350,000 and $500,000 (for up to 7 years)– Lender uses its own loan approval process and documents– For financing of inventory, accounts receivable and export development activities

Export Working Capital Program (EWCP)– 90% guarantee for amounts up to $5,000,000– Use of funds similar to Export Express

International Trade Loan Program– 90% guarantee for amounts up to $5,000,000– For working capital term loans for financing and refinancing of fixed assets used for

exporting (loan tenures up to 10 years for plant & equipment and 25 years for real estate)

SBA Export Financing Programs

The Export Express program is perfect for companies needing working capital to jump start their export sales.

– 90% guarantee for amounts up to $350,000 (for up to 7 years)– Lender uses its own loan approval process and documents– Loan proceeds can be used for any export promotion related activity, including but not limited to;

• export related activities; export development expenses, such as brochure translation or participation in a trade show

• transaction-specific financing of export deals, including standby letters of credit• general lines of credit for export purposes• term loans for permanent working capital, machinery and equipment, or real estate

– Finance purchase orders, inventory and account receivables

Funding Entire Export Business

Developing an Export Business Plan– www.sba.gov/exportbusinessplanner

•A downloadable tool to save and customize •How to determine your export readiness •Training and counseling information •Worksheets for global market research •Financing information and options •Customizable Export Business Plan and Marketing Plan templates •Helpful resources for exporters •Glossary of Export Terms •And more!

SBA Export Business Planner

http://www.sba.gov/exportbusinessplanner

Technical Information for the bank• AR advance rate is 80% (90% for L/Cs or insured AR)• Inventory advance rate is 75%• Indirect export transactions are eligible• Advances against purchase orders allowed (Ex-Im does not)• No minimum underwriting ratios (Ex-Im has several)• Military products are eligible (not at Ex-Im)• Refinancing is allowed• ABL and similar monitoring fees allowed under EWCP• Robust secondary market (premiums can exceed 10%)

Bill Houck, Regional Manager(DC ,VA, WV, MD, DE, PA)Export Solutions Group

Office of International [email protected]

+1 202-557-4063


www.ustda.gov

Opening Markets, Generating

ExportsU.S. Trade and Development Agency

Leila Aridi AfasDirector for Export Promotion

November 14, 2012

www.ustda.gov

Mission Statement

USTDA helps companies create U.S. jobs through the export of U.S. goods and services for priority development projects in emerging economies

USTDA links U.S. businesses to export opportunities by funding project planning activities, pilot projects, and reverse trade missions while creating sustainable infrastructure and economic growth in partner countries

www.ustda.gov

National Export Initiative

Increase U.S. exports to $3.14 trillion by 2015

Response to the National Export Initiative:• Launched the

International Business Partnership Program

• Increased Trade Advocacy

President Obama Announces Export Promotion Cabinet as part of the National Export Initiative

www.ustda.gov

Small Businesses

Foundation of the U.S. Economy

• Over 90% of all contracts with USTDA are signed with SMEs

• 44% of contracts awarded under USTDA grants are won by SMEs

www.ustda.gov

USTDA Program Activities

International Business Partnership Program

• Reverse Trade Missions

• Conferences• Workshops

Project Development Program

• Feasibility Studies• Pilot Projects• Technical Assistance

Matching U.S. Commercial Interests with Development Opportunities

www.ustda.gov

International Business Partnership ProgramReverse Trade Missions:

USTDA brings foreign project sponsors to the United States pending upcoming procurements to observe the design, manufacture, and operation of U.S. products and services.

www.ustda.gov

International Business Partnership ProgramConferences/Workshops:

USTDA organizes these sector or region-specific events to connect U.S. firms with foreign buyers. They are designed to highlight upcoming projects overseas, as well as showcase U.S. goods and services.

www.ustda.gov


Feasibility Studies:

USTDA-funded and U.S.-led feasibility studies link foreign project sponsors with U.S. businesses at the critical early stage of project development. Analysis includes:

• Technical• Financial• Legal• Environmental• Lifecycle costing

www.ustda.gov


Pilot Projects:

USTDA-funded pilot projects demonstrate the effectiveness of commercially proven U.S. technologies and equipment in the foreign buyer’s setting.

www.ustda.gov


USTDA advances economic development in partner countries by funding technical assistance that:•Supports legal and regulatory reform related to commercial activities and infrastructure development;•Establishes key industry standards ; and•Opens other market activities

www.ustda.gov

Small Business Success

• USTDA funded a pilot project to test NTELX’s traffic coordination system at the Port of Aqaba in Jordan

• Jordan’s Ministry of Transportation awarded a contract directly to NTELX

• NTELX is working with countries across the region on similar projects

www.ustda.gov

USTDA By Sector(As a Percentage of USTDA’s FY 2011 Program Budget)

www.ustda.gov

USTDA Funding Criteria

USTDA evaluates projects based on the following criteria:

• Developmental priority in the host country

• Likelihood of success receiving implementation financing

• Mutual benefits for the United States and partner country, including commercial opportunities for U.S. firms

www.ustda.gov

Getting Involved

www.ustda.gov

Contact USTDA

U.S. Trade and Development Agency

1000 Wilson BoulevardSuite 1600Arlington, VA 22209

Telephone: (703) 875-4357

Fax: (703) 875-4009

Website: www.ustda.gov

www.Facebook.com/USTDA

www.Twitter.com/USTDA

Executive

Summary

VEDP VALET Webinar: Utilizing U.S. Export Finance Programs

November 14, 2012

Export-Import Bank of the United States

What is Ex-Im Bank?

The official Export Credit Agency (ECA) of the U.S. Government

Self-sustaining and independent

Established in 1934 Headquarters in D.C. Network of regional offices*

Mission: Assist in financing the export of U.S. goods and services to international markets.


Ex-Im Bank Products Make a Difference

▪ Minimize risk

▪ Level the playing field

▪ Supplement commercial financing


We Support a Variety of Industries

▪ Manufacturing

▪ Construction Equipment

▪ Medical Equipment

▪ Mining

▪ Power-generation

▪ Aircraft and Avionics

▪ Services

▪ Renewable Energy

▪ Agribusiness

▪ Wholesale/Retail

▪ Oil


Ex-Im Bank Financing Covers the Spectrum

Pre-Export Financing

Post-Export Financing

Working Capital

Guarantee

InsuranceGuarantees

Direct Loans


NEED SOLUTION

Extension of Credit

Working Capital Guarantee

Funds to Fulfill Orders

Buyer FinancingMedium- and Long-Term

Insurance & Loan Guarantee

Receivables Insurance

How Can Export Import Bank Products Assist You?


Working Capital Guarantee

▪ Funds to pay for raw materials, labor, supplies, etc.

▪ 90% guarantee to lenders for export-related working capital loans

▪ Advances are supported by export-related:

– Inventory up to 75%

– Receivables up to 90%

▪ Transaction specific or revolving loans


Short-Term, Accounts Receivable Insurance Protects U.S. exporters up to 95% against non-payment by foreign buyers due to:

– Commercial Risks– Political Risks

Allows exporters to offer competitive credit terms to foreign buyers

– Generally up to 180 days, some 360 day terms

– $0.50 per $100 to $1.50 per $100

Obtain additional financing

Multi-Buyer or Single-Buyer. With experience, exporter is given authority to set Discretionary Credit Limits for buyers


Global Credit Express (GCE)

▪ Newly launched product for small businesses

▪ Financing for business of exporting, not just specific export

▪ Revolving credit line

▪ Up to $500,000 for 6-12 months

▪ Streamlined application process


Buyer Financing at Competitive TermsFor international buyers purchasing U.S. capital equipment and services:

▪ 85% financed, 15% cash down payment

▪ Medium-term

– Repayment typically up to 5 years and amounts up to $10 million

▪ Long-term

– Greater than 5 years and over $10 million


Just A Few Restrictions

▪ Military Exports (exceptions apply)

▪ Foreign Content

▪ Restricted Countries (CLS)


For More InformationCall the Ex-Im Bank Regional Office near you:▪ New York: 212-809-2650 (Northeast / Mid-Atlantic)

▪ Miami: 305-526-7436 (Southeast)

▪ Atlanta: 404-897-6082 (Southeast)

▪ Chicago: 312-353-8081 (Midwest)

▪ Minneapolis: 612-348-1213 (Midwest)

▪ Detroit: TBD* (Midwest)

▪ Houston: 281-721-0465 (Southwest)

▪ Dallas: 214-551-4959 (Southwest)

▪ Seattle: 206-728-2264 (West)

▪ Newport Beach: 949-660-1341 (West)

– San Francisco: 415-705-2285

– San Diego: 858-467-7035

WEBSITE: www.exim.gov


Ex-Im Bank Partners

Additional resources and assistance in applying for Ex-Im Bank products are available from:

▪ Insurance Brokers (see list on www.exim.gov)▪ City / State Partners (see list on www.exim.gov)▪ Delegated Lenders (see list on www.exim.gov)▪ US Export Assistance Centers (USDOC and SBA)

http://www.exim.gov/

http://www.exim.gov/


For More Information

Michael K. Jackson, MBA, CGBPDirector, City/State Partners

Export-Import Bank of the United States811 Vermont Avenue, N.W.

Washington, D.C. 20571Phone: 202 565-3479

Fax: 202-565-3930Email: [email protected]

Overseas Private Investment CorporationOverseas Private Investment Corporation

An Agency of the U.S. Government

Overseas Private Investment Corporation 41

Introduction to OPICIntroduction to OPIC

• U.S. Government’s Development Finance Institution established in 1971

• OUR MISSION: Facilitate and support U.S. private investment in developing countries and emerging markets.

•Helps U.S. companies enter, grow, and compete in the global marketplace•By supporting investments, generates U.S. exports and U.S. jobs•Catalyzes sustainable economic development in foreign markets

• WHAT WE OFFER: A suite of financial products that help U.S. companies enter international markets where private capital may be limited or unavailable.

• HOW WE RAISE THE BAR: U.S. best practices for environmental safeguards and worker/human rights.

• HOW WE’RE FUNDED: OPIC operates at no net cost to U.S. taxpayers and has made a profit consecutively for 34 years, including $269 million for the 2011 fiscal year.


Where We Work - 150+ CountriesWhere We Work - 150+ Countries

Our Clients and Alliances

Current Clients Strategic Alliances

OPIC partners with other U.S. government agencies and international partners to provide financing and risk mitigation products to a wide range of clients

― Departments of State, Commerce, and Treasury

― USAID & USTDA― Ex-Im Bank and SBA― Millennium Challenge Corp.

― IFC and MIGA― Regional Development Banks

(EBRD, IDB, ADB, EBRD)― Bilaterals (CDC, FMO, DEG,

Proparco, DFID

― Chambers of Commerce― AmChams― NGOs ― Financial Institutions

US Gov’t

Development Finance

Institutions

Other Partners

Multinationals and Small/Medium Businesses

Nonprofits and Impact Investors

43


OPIC Political Risk InsuranceOPIC Political Risk Insurance

• PRI covers acts of political violence; expropriation; and currency inconvertibility (aka, currency conversion and transfer)

• Protection for different types of U.S. exposure: equity, debt, leases, performance/advance payment guaranties, contracts with governments, etc.

• Coverage is long-term, typically not less than three years, up to 20 years for equity, longer for other types of investments such as long-term debt

Investor Eligibility and Conditions of InsuranceInvestor Eligibility Terms and Conditions of Insurance

• U.S. Citizens

• Corporations established in the U.S. and more than 50% owned by U.S. citizens or corporations

• Not-for-profits established in the U.S.

• Corporations established outside the U.S. and more than 95% owned by U.S. citizens or corporations

• Other foreign entities that are 100% U.S.-owned

• Eligible Investors

• 20+ year coverage (3 year min.)

• Coverage of up to $250 million per project

• Up to 90 % of investment (10% self-insurance) for equity

• 100% coverage for commercial bank loans or leases (from unrelated third parties)

• Premium rates fixed for full term of coverage

Coverage for Various Forms of Investment

Investment Form of Investment/Exposure % Covered

Equity Equity, including retained earnings, subordinated debt 90%

Debt Bank loans, bonds, and capital or operating leases from third party financial institutions

100%

Assets Tangible property, including consigned equipment 90%

Private Contracts

Contracts among private parties to provide services, including construction, procurement, management, technical services, “know how” or franchise agreements

90%

Contracts with Foreign Governments

Contracts with a foreign government agency or company:- Bid bonds or guaranties , including advance payment, performance, warranty or customs bonds -Tangible assets used to perform the contract- Disputes that arise, including non-payment

90%

90%90%


Coverage Tailored by Type of Project and Special Risks

Type of Projects & Risks Specialized Forms of Coverage

Infrastructure, including power, airports, ports, railways, etc.

- Creeping expropriation, including breach of contract, denial of justice, arbitral award default for long-term purchase or supply agreements with government owned and controlled companies.

Renewable Energy Infrastructure, including solar, wind, hydro, etc.

- Loss of business income due to “regulatory risks” or breach of “feed-in tariff” contract.

Non-governmental and not-for-profit organizations, including emergency relief services or schools

- Loss of bank accounts, tangible property and extraordinary expenses (such as evacuation expenses or forced abandonment of assets)

Microfinance - Foreign government acts affecting microenterprise borrowers, partial expropriation (bank accounts), and local currency risks

47Overseas Private Investment Corporation


Terms for OPIC FinancingTerms for OPIC Financing

• Long-term financing (tenors from 3 to 20 years)

• Fixed interest rate available

• Accepts foreign collateral plus “project completion support”

• Finance from 50 to 75% of the total project cost

• Loans from $350,000 to $250 million

• Direct loans for projects involving U.S. small and medium –sized enterprises (SMEs):

• U.S. SME or U.S. citizen/permanent resident owns at least 25% of project shares; OR• Other significant U.S. participation (e.g., U.S. contractor, U.S. operator, U.S. franchise).• No U.S. procurement requirements.


I have a project. How do I learn more?I have a project. How do I learn more?

1. Review the website: www.OPIC.gov(Hint: Review Our Investor Screener)

2. Consult Small Business Guide:http://www.opic.gov/small-business

3. Discuss your project with OPIC:- [email protected] or +1 (202) 336-8400

4. Insurance: Complete Form 50 Finance: Complete Section1a of Form 115

5. Need assistance? Loan Originators: www.ednaccess.com


Contact DetailsContact Details

Brian O’HanlonDirector and Coordinator, Business Development

InsuranceOverseas Private Investment Corporation (OPIC)

1100 New York Avenue, N.W.Washington, D.C. 20527 U.S.A.

Tel: +1 (202) 336-8474Email: brian.o’[email protected]


Bill HouckRegional Manager (DC ,VA, WV, MD, DE, PA)

Export Solutions GroupOffice of International Trade

Small Business [email protected]

+1 (202) 557-4063

Brian O’HanlonDirector and Coordinator

Business Development InsuranceOverseas Private Investment Corporation

brian.o’[email protected]+1 (202) 336-8474

Michael JacksonDirector

City/State & Trade Association PartnersExport-Import Bank of the Unite States

[email protected]+1 (202) 565-3479

Leila AfasDirector

Export PromotionUnited States Trade and Development Agency

[email protected] +1 (703) 875-4357




VALET Webinar: Utilizing U.S. Export Finance Programs Wednesday, November 14, 2012 2:00 p.m. to 3:30...

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