Export-Import Bank Support for U.S. Exports to Iraq

“Our recent policy changes in Iraq will allow us to support more U.S. export opportunities and mirrors our commitment to assist wherever our support is needed in promoting quality American goods and services around the world” – Fred Hochberg, Chairman, Export-Import Bank of the U.S.

The increasing signs of stability and security in Iraq have opened new opportunities for financing into the market.  Ex-Im Bank is open to transactions in both the public and private sectors for tenors typically up to 5 years (7 years on an exceptional basis). Financing options available include:

Insurance
Reduces nonpayment risk on transactions involving U.S. goods & service exports.
Transactions can be short-term (less than one year) and typically support raw materials, spare parts, agricultural exports, ranges, refrigerators, et. Al. or medium-term (2-5 years), generally in support of capital goods exports.  

Loan Guarantees
Guarantees 100% of commercial and political risks on commercial bank loans to Iraqi public or private sector borrowers or financial institutions. Available on medium-term transactions involving U.S. manufactured capital goods or services.

Direct Loans
Provides direct funding to Iraqi public or private sector borrowers or financial institutions. Available on medium-term transactions involving U.S. manufactured capital goods or services.
Note that for direct loans, any items exported via ship must be sent on vessels of U.S. registry (this requirement does not apply to exports shipped by air, nor does it apply to short-term transactions).
 
Third Party Support
Where the buyer and end-user are Iraq entities, Ex-Im Bank can consider transactions where the borrower or guarantor is a creditworthy entity in a country where Ex-Im Bank is fully open (e.g. Bahrain, Jordan, Kuwait, etc.)

Requirements
In keeping with Ex-Im Bank’s credit standards, information criteria and requirement to find that a “reasonable assurance of repayment” is present in each transaction it supports, Ex-Im Bank will likely consider transactions that conform to the following (please see the Bank's Country Limitation Schedule)

1. Public sector transactions that convey the full faith and credit of the Government of Iraq, are identified as being of the highest priority to the Government and conform with any limits on non-concessional borrowing
2. Private sector transactions Ex-Im Bank with financial institutions or other entities which are able to provide detailed financial information sufficient to enable Ex-Im to reach a credit conclusion. Financial statements provided in support of the transaction should be audited by an affiliate of an international accounting firm and prepared in accordance with International Financial Reporting Standards (IFRS).

Pricing
Ex-Im Bank charges risk-based fees in order to provide its support.  Indicative fees may be found via the Bank’s Exposure Fee Calculator and Exposure Fee Advice Tables at http://www.exim.gov.

 

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News from Other Federal Agencies

U.S. Department of State Engaging U.S. Businesses on Iraq - March 5, 2012

Market Intelligence Reports Available on Iraqi Companies

Iraq Investment & Reconstruction Task Force, U.S. Department of Commerce

MARKET OPPORTUNITIES from the U.S. Department of Commerce

In order to provide U.S. exporters with timely information about opportunities for exporting U.S. goods and services to Iraq, the Export-Import Bank of the United States is listing websites that contain a wealth of regulatory, contracting, financing, and other information pertaining to business opportunities in Iraq.

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Updated: 20120305