EXIM Loan Guarantees Help Secure Competitive Financing for Railway Modernization Project in sub-Saharan Africa
The Export-Import Bank of the United States (EXIM) is taking an active role in providing the necessary financing to help support the growing demand for modernized infrastructure in sub-Saharan Africa. With the support of EXIM, Wabtec Corporation, located in Erie, Pennsylvania, will sell four diesel-electric locomotives to Cameroon Railways (Camrail) in Cameroon. The company received loans from Standard Chartered Bank in New York for the purchase of the four C30ACi locomotives.
Merged with General Electric Transportation in February, Wabtec used two EXIM medium-term loan guarantees totaling $13 million to help manufacture the locomotives in its Erie facility.
The borrower is Cameroon’s Ministry of Economy, Planning, and Regional Development, and the locomotives will be used on passenger trains as part of Camrail’s fleet renewal and modernization plan.
Wabtec’s transaction illustrates how EXIM can assist companies by guaranteeing financing to creditworthy foreign buyers in both private and public sectors. With EXIM’s loan guarantees, buyers are able to obtain competitive term financing from lenders when it is otherwise unavailable or when there are no economically viable interest rates on terms of more than one year.
Exporters such as Wabtec receive payment at the time of shipment, and with this payment guarantee, U.S.-based companies have greater ability to compete for sales in new markets worldwide.
Other benefits of EXIM's medium- and long-term loan guarantees include:
- Risk mitigation for a transaction with a buyer
- More secure entry to emerging markets
- Longer repayment terms
- Flexible lender financing options
Ensuring Safe and Reliable Passenger Rail Service
EXIM’s guarantees are not only helping support U.S. exports and American jobs, but they also are helping modernize Cameroon’s railway service. The former Cameroon national Railway was privatized to Camrail in 1999. Camrail, which is majority privately owned, owns all rolling stock and is responsible for overseeing all freight and passenger operations and freight-rail investments. The Cameroonian government has responsibility for investments related to passenger rail.
Your company can also enter new markets with confidence and increase its international sales. EXIM supports U.S. companies of all sizes, and no transaction is too small or large. The agency has trade finance experts in regional offices throughout the country who can answer questions and provide information about EXIM’s products and services, and they can guide you through the application process. Contact Stephen.Maroon@exim.gov or call 202.565.3901 to learn more.