FOR IMMEDIATE RELEASE October 22, 1998
Marianna Ohe (202) 565-3200
Teamwork is enabling companies such as U.S. Equipment Exports Inc., a small Red Oak, TX truck wholesaler, to expand sales in Sub-Saharan African markets such as Ghana, Botswana, Zimbabwe and South Africa using an array of financing tools provided by the Export-Import Bank of the United States (Ex-Im Bank).
Ex-Im Bank`s aggressive support of small businesses and U.S. exports to sub-Saharan Africa requires cooperation from a network of lenders, City/State Partners, insurance brokers and other agents both in the United States and in foreign markets, said Ex-Im Bank Board member Maria Luisa Haley. Partnerships are critical to the success of these initiatives.
These partnerships are working in Ghana where U.S. Equipment is selling $750,000 of trucks and container chassis to Algist Limited, a Tema, Ghana, shipping and forwarding company, to haul cargo from Ghana ports to destinations in Burkina Faso and Ghana`s interior, including shipments of food and medicine for international relief agencies.
First National Bank of New England, Hartford, CT was able to turn around an Ex-Im Bank-guaranteed medium-term loan in two weeks to enable Algist to buy the transportation equipment. At the same time, an Ex-Im Bank-guaranteed working capital loan from Texas Central Bank, Dallas, TX, is financing U.S. Equipment`s purchase of the equipment to fill Algist`s order.
A key player in the Algist deal is First National Bank of New England`s marketing agent in Ghana, Network Financial Services Limited (web site: ghanaba.com), which introduced Algist as a potential borrower. Network Financial Services is a financial services company established in Accra, Ghana, with offices in Orange, NJ, that has an agency agreement with First National Bank of New England to promote Ghanain and West African purchases of U.S. goods and services.
We have about eight deals coming through now, said Network Financial Services CEO Prosper Adabla. We identify U.S. suppliers for African buyers, put the financing together through First National Bank of New England and Ex-Im Bank, and ship the equipment to them. U.S. exporters and African buyers can access information about our services and U.S.-Africa trade through our web site.
At the other end of the truck transaction in Red Oak, TX, U.S. Equipment used an Ex-Im Bank working capital guarantee to finance the purchase of late model diesel trucks, tractors and container chassis to fill Algist`s order. We`ve had the working capital guarantee for the past two years to help us compete in African and other foreign markets which make up more than 95 percent of our business, said CEO Don F. Mc Nally. There are other financing sources, but they have extremely high interest rates, or require our customers to pay in advance. That made us less competitive, and so about two years ago we looked for a new source of financing.
Fortunately Ex-Im Bank has a strong City/State Partner in Dallas, the Greater Dallas Chamber of Commerce. The City/State Partners Program is a joint effort between Ex-Im Bank and state and local entities around the country to bring Ex-Im Bank`s financing services to small and medium-sized U.S. companies that are ready to export. Thierry Meyrat, Director of Trade Finance at the Dallas Chamber, quickly packaged U.S. Equipment`s application for an Ex-Im Bank Working Capital Guarantee and gave it to Texas Central Bank, an Ex-Im Bank Delegated Authority Lender that can approve Ex-Im Bank-guaranteed financing quickly without red tape.
Robert Monyak, Vice President, International Banking, First National Bank of New England, said not only was Ex-Im Bank`s guarantee essential to the Algist loan, but also when we learned that U.S. Equipment had experience using Ex-Im Bank programs, that certainly supported their participation as an exporter in this transaction.
Since 1994, Ex-Im Bank has financed nearly $800 million in exports to sub-Saharan Africa, using not only its traditional loan, guarantee and insurance programs, but also its limited recourse project finance program where repayments come from project revenues. (Program availability varies by country; check Ex-Im Bank website -- www.exim.gov -- for up-to-date information.)
Ex-Im Bank is an independent U.S. government agency that assists in financing the export of U.S. goods and services to industrializing and developing markets all over the world by providing loans, loan guarantees, and export credit insurance. In fiscal year 1998, Ex-Im Bank supported $12.8 billion of U.S. exports.