The $200 million co-lending agreement allows trade to be financed in several currencies, including the Chinese renminbi
BEIJING, China – Luis Alberto Moreno, president of the Inter-American Development Bank, on Sept. 16 signed an agreement with the Export-Import Bank of China (China Eximbank) that will provide up to $200 million in trade financing for commerce between China and Latin America and the Caribbean (LAC).
“China has played an important role in financing the Bank’s efforts in the region since joining the Bank in 2009,” Moreno said of the agreement, which also was signed by Zhu Xinqiang, Vice President of China Eximbank. "Trade between China and Latin America and the Caribbean has surged from just $12 billion in the year 2000 to more than $188 billion. This will facilitate further expansion of our already-strong commercial ties."
The two-year agreement, which can be extended, provides up to $200 million to support trade flows between China and LAC. The underlying transactions will allow trade in renminbis.
The Export-Import Bank of China (China Eximbank)
China Eximbank is a government policy bank enjoying the same international credit ratings as China's sovereign ratings. As an important force in promoting foreign trade and economy and a significant component of the financial system, China Eximbank has been acting as a key channel of policy financing for both Chinese import-and- export of mechanic and electronic products, complete sets of equipment, and high- and new-tech products and undertaking of offshore construction contracts and overseas investment projects by Chinese companies.
TFFP
The IDB launched the TFFP in 2005 to provide credit guarantees to boost trade financing for Latin American and Caribbean companies. In December 2008, the IDB expanded the TFFP to a maximum of $1 billion, up from its original $400 million limit, in response to the global economic crisis. The program was also modified to allow the issuance of loans and to support transactions denominated in currencies other than U.S. dollars. Since its inception the program has built a network of 76 issuing banks in LAC and 261 confirming banks in LAC, North America, Europe, Asia and Africa.
Inter-American Development Bank
The Inter-American Development Bank (IDB) offers its financial products and resources to help Latin America and the Caribbean countries reduce poverty and inequality in a sustainable way. The IDB seeks to create cooperation opportunities with other countries. It is the first and largest regional development bank and the main source of multilateral finance for the region.