Speech

News Release

Jeffrey Miller

Senior Vice President and Head of Export Finance

Infrastructure Finance Conference
Bucharest, Romania
November 16, 2004, 9:15 a.m.

INTRODUCTION

Good morning. I would like to thank Jim Lambright, Ex-Im Bank's executive vice president, and Romania's Finance Minister, Mihai Tanasescu for their opening comments.

I want to join both of you in welcoming everyone to the Export-Import Bank of the United States' Infrastructure Finance Conference. I also want to second Jim's comments in thanking the many people with Ex-Im Bank and in Bucharest who have helped make this conference possible. We are especially pleased that U.S. Ambassador J.D. Crouch II; Mariana Diaconescu, the president and CEO of Romania's Ex-Im Bank; and so many mayors and municipal leaders could participate.

Financing significant infrastructure projects and expanding U.S. trade with Southeast and Central Europe are both key objectives of the Export-Import Bank. That is why we decided to invite U.S. companies, Western banks, our colleagues from the European Bank for Reconstruction and Development, and mayors, governors, and other local-government officials from the region.

INFRASTRUCTURE NEEDS IN SOUTHEAST AND CENTRAL EUROPE

This is an auspicious time for Southeast and Central Europe, as many of the region's countries joined the European Union earlier this year, and others are poised to do so in the near future. The region's economies are growing and - 15 years after the fall of communism - democracy is flourishing, as upcoming elections in the region illustrate. But Southeast and Central Europe have many basic infrastructure needs to address if their economies and societies are to continue on the road to prosperity.

Infrastructure is vital to economic development and to the well-being of any nation and community. It is a building block of strong, democratic, and prosperous societies.

Of course, the term "infrastructure" embraces many things - transportation and telecommunications systems, hospitals and schools, power plants and wastewater-treatment facilities. Most of these are the big-ticket items in an economy, the multibillion-dollar projects that require substantial public sector, as well as private sector, investment.

While the World Bank and other multilateral development banks provide financing for infrastructure projects in poorer countries, equity, bond, and commercial lender financing is often unavailable particularly for national, city, and state governments in areas such as Southeast and Central Europe. That's where export credit agencies, or ECAs, such as Ex-Im Bank play such a critical role. In fact, ECAs are a major source of financing for such infrastructure projects.

EX-IM BANK

Ex-Im Bank plays a dual role. We support U.S. exports, particularly to emerging markets, which sustains U.S. jobs. At the same time, our financing helps foreign buyers - both private and public sector - purchase the goods and services they need to grow their businesses, expand their nations' economies, and meet their people's needs. So, it is a win-win situation.

Ex-Im Bank provides loan guarantees and export credit insurance to facilitate U.S. export transactions, as well as project finance and structured finance to support major infrastructure projects. No export is too small or too large, and there is almost no financing challenge that we cannot address.

Southeast and Central Europe are a priority for Ex-Im Bank - as evidenced by this conference, the conference we held last fall in Slovenia, and our increasing activity in the region. There are few areas of the world to which we are devoting so much attention.

We recognize that infrastructure needs are just as serious in middle-income countries as in less-developed countries. Cities and regions need good roads, clean water, effective waste-management systems, and decent health care and educational facilities.

Ex-Im Bank has a long track record in infrastructure finance. Moreover, because we recognize that cities and states often are the decision-makers and purchasers for infrastructure projects, Ex-Im Bank has an initiative to provide financing for municipal and regional projects without sovereign guarantees.

I am proud to say that - to my knowledge -- Ex-Im Bank is the world's only export credit agency that will consider accepting the credit of qualified cities, states, provinces, and other subsovereign entities that are current on foreign currency obligations, and whose borrowings are in compliance with local law. A number of cities, states, and provinces in Southeast and Central Europe qualify for this program.

We have already met with more than a dozen mayors and governors throughout the region - from Zagreb and Sofia to Kiev and Bucharest - to explore potential projects.

Our colleagues at EBRD deserve kudos for their pioneering efforts to provide financing to localities. It is currently the only multilateral development bank that offers this sort of subsovereign financing without a sovereign guarantee. Formally and operationally, our two institutions have agreed to cooperate to support subsovereign infrastructure projects throughout Southeast and Central Europe.

EX-IM BANK ACTIVITY IN THE REGION

In this region, Ex-Im Bank has helped finance many U.S. exports that are contributing to infrastructure development, and it is our goal to significantly expand this support. All told, we have supported approximately $2 billion in U.S. exports to the region during the last half-dozen years. Ex-Im Bank has been especially active in Romania. We provided loan guarantees and export insurance to help Romania's Ministry of Health purchase cardiology diagnostic equipment and other medical technology, we supported the sale of commercial jets to Tarom, the Romanian national airline, and we provided more than $100 million in financing for Romania to purchase broadcasting and satellite equipment.

We are especially pleased to have provided financing for the Romanian government to purchase weather-management and flood-prevention technology that will enable the National Ministry of Hydrology to monitor and forecast weather conditions to help mitigate the dangers of flooding.

In Croatia, a few years ago, we played a key role in helping the government construct a 123-mile highway from the Slovenian border to the capital city, Zagreb, and on to the Adriatic coast toward the city of Split. Also in Croatia, we guaranteed the financing of a turnkey power plant in Zagreb. The transaction qualified for Ex-Im Bank's Environmental Exports Program because the plant replaced an oil-burning facility and helped reduce air pollution in Zagreb.

In Bulgaria, Ex-Im Bank has guaranteed or insured several transactions with private-sector companies. Whereas Ex-Im Bank normally requires local bank guarantees, we provided a medium-term loan guarantee that enabled Cable Bulgaria in Sofia to buy fiber-optic switching equipment from U.S. exporters. And a plastic-container manufacturer in Pleven, Bulgaria, used an Ex-Im Bank guarantee to purchase manufacturing equipment.

Many of these projects involve national governments, but I want to emphasize that we do not require a sovereign guarantee to do business. We can support municipal and regional projects, and we actively seek public-private partnerships. These structures do not depend on sovereign guarantees, they attract private investment, and they help move the economy towards a greater market orientation.

While there is much more that I could say about Ex-Im Bank, today's panel discussions and tomorrow's one-on-one meetings will afford excellent opportunities to learn more about how the Bank can help cities, states, and provinces finance their infrastructure needs. In particular, I urge you to get to know Margaret Kostic and Mary Beth Adamchik of Ex-Im Bank, as well as our U.S. government colleague in the Foreign Commercial Service, Jonathan Marks.

CONCLUSION

If there is one message that I'd like you to take away from this conference, it is that Ex-Im Bank is eager to do more. We want to transform our commitment and the business connections made at this conference and beyond into transactions that will provide needed infrastructure.

U.S. companies offer goods and services that are second to none, and we at Ex-Im Bank have the financing to help governments and private companies in this region obtain the very best.

Please take this opportunity during the next two days to learn what we can do for you, and to talk with me - or Margaret Kostic, Mary Beth Adamchik or Jim Lambright - about your financing needs. Thank you again for being here, and I hope the conference proves beneficial to you.