VEB.RF and International Bank for Economic Co-operation Agree to Jointly Finance Export-Import Operations
VEB.RF and the International Bank for Economic Co-operation (IBEC) signed a cooperation agreement.
The document was signed on behalf of VEB.RF by its Deputy Chairman Daniil Algulyan and on behalf of IBEC by its Chairman of the Board Denis Ivanov.
The parties agreed to cooperate in export and trade financing as well as to implement investment projects both in Russia and in other IBEC member states.
IBEC member states are: the Republic of Bulgaria, the Socialist Republic of Vietnam, Mongolia, the Republic of Poland, the Russian Federation, Romania, the Slovak Republic, and the Czech Republic.
“Today we and our partners from the International Bank for Economic Co-operation are defining priority areas and the pipeline of projects,” Daniil Algulyan said.
“I am convinced that the partnership between VEB.RF as the largest Russian development institution and IBEC as an international development institution will help unlock significant potential of our organizations in facilitating the development of the eight IBEC member states through the implementation of joint projects, development of exports and integration of companies into global value chains,” Denis Ivanov said.
The financial institutions intend to use the following export and trade financing loan and documentary tools for the implementation of projects:
- documentary letters of credit, guarantees, bank-to-bank reimbursement arrangements;
- trade loans for trade financing, including pre-export, post-export, pre-import, and post-import financing;
- participation in syndicated loans in areas that meet the interests of the parties;
- financing of foreign economic operations against the coverage by ECAs;
- factoring and forfeiting.
In addition the parties agreed to exchange information related to the export and trade financing banking services in IBEC member states.
The International Bank for Economic Co-operation is an international finance institution established in 1963. IBEC is operating as per an intergovernmental Agreement registered with the UN Secretariat. IBEC main activities are aimed at lending financial support to foreign trade operations of companies residing in IBEC member states as well as supporting small and medium enterprises which create added value and aspire to enter new markets; and facilitating integration into global value chains, increased use of technology, improved energy and resource efficiency of production and services, and boosting competitiveness in accordance with priorities of social and economic development of IBEC member states.
VEB.RF and Stroyproyektholding Agree to Create Largest Infrastructure Financing and Construction Player
VEB.RF and Stroyproyektholding agreed to create a joint venture, the largest player on the infrastructure financing and construction market.
The signing ceremony of the Memorandum of understanding, goals and principles of the joint venture at the St. Petersburg International Economic Forum was attended by VEB.RF’s Chairman Igor Shuvalov.
Under the planned agreement, VEB.RF will possess a 50% stake in the JV. The agreement to form an alliance between infrastructure construction companies and the financial development institution will bring significant synergy effects, including projects financing support, entry to international markets, project structuring competencies. The agreement will create a platform enabling active engagement in the national projects to fulfil transport and urban infrastructure development goals.
The parties consider expanding the joint venture competencies to cover other areas of infrastructure construction, namely construction of energy, shipping and rail road infrastructure. The joint venture is interested in the assets of the largest players in these areas of business: TEK Mosenergo, Trest Gidromontazh, the 1520 Group of Companies etc.
“We analysed international integrated infrastructure companies’ best practices and can make a conclusion that a joint venture will be an efficient tool to achieve an infrastructure breakthrough in the Russian Federation; this joint venture may benefit from significant competitive advantages on the international markets as it will bring together the leaders in design, construction and operation of complex infrastructure facilities and the State Development Corporation VEB.RF’s tangible financial resources and project financing structuring experience,” VEB.RF’s First Deputy Chairman and Member of the Management Board Nikolay Tsekhomsky said.
“Participation in this project is advantageous from all angles. First, we are expanding our opportunities: team’s lessons learnt will be useful in more cases. Second, approved by the parties partnership pattern creates new process equipment upgrade opportunities, ways to procure state-of-the-art machinery, which will make it possible to master cutting edge technologies,” Stroyproyektholding’s Executive Director Alexey Spiridonov emphasized.
The joint venture participants considered Stroyproyektholding’s complex infrastructure projects design and construction experience and VEB.RF’s infrastructure projects financing experience and came to a conclusion that both parties are a perfect match to complement each other’s key competencies to become a leader on the complex infrastructure financing and construction market: HR, experienced and highly qualified management, management systems, supply chains, requisite financial resources, engineering and production capacities, know-how and unique technologies for the Russian market.
VEB.RF is a state development corporation. In partnership with commercial banks and investors, VEB.RF is involved in national projects designed to support high value-added manufacturing, non-resource exports, urban agglomeration and infrastructure development. VEB.RF coordinates activities of the largest national development institutions: Russian Export Center, DOM.RF, RSMB Corporation, the Far East and Baikal Region Development Fund, MONOGORODA.RF.
Stroyproyektholding LLC a holding company with a single member A.R. Rotenberg established in 2014. Stroyproyektholding owns 100% shares in TFK Finance JSC, the majority shareholder of Mostotrest PJSC.