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Perspective
30 May 2014

JB's weekly round-up - 30 May 2014

Region:
Middle East & Africa, Americas, Asia-Pacific, Europe
Editor-in-chief
The great and good of Spain’s export finance community met for an informal roundtable in Madrid yesterday. The meeting, jointly hosted by TXF and Cesce – the Spanish export credit agency (ECA), featured participation from the government, large and small exporters, and leading Spanish and international banks.

 Hola from Madrid!
The great and good of Spain’s export finance community met for an informal roundtable in Madrid yesterday. The meeting, jointly hosted by TXF and Cesce – the Spanish export credit agency (ECA), featured participation from the government, large and small exporters, and leading Spanish and international banks.
 
The discussions centred on issues such as challenges when exporting to Africa, accessing European funding sources, the differing pressures on small and large exporters, and the competitiveness of the ECA product in comparison to other countries.

TXF would like to thank the 30 participants, and our excellent facilitators Beatriz Reguero of Cesce, and Henri D’Ambrieres of HDA Conseil.
 
 I’ve got a luvvely bunch of cocoa-nuts!
Well, last week was a particularly busy time in the commodity finance market – with probably few feeling happier than the group of German banks – and others – that won the Ghana Cocoa Board (Cocobod) mandate (of course, nothing to do with coconuts, I was just ‘having a laff’ – as we say up north!).
 
The big change on the mandate is a new six bank group, comprising Barclays, Commerzbank, Deutsche Bank, DZ Bank, KfW IPEX-Bank and Natixis. And the pricing? It’s cheaper – of course, that’s how and why they won the mandate. Read all about that in the news item.
 
So with Ghana looking at a bigger cocoa crop through the 2014-2015 season, the financing is for $1.6 billion – way up on last year’s $1.2 billion. Cocoa rolls on.
 
 Olam signs off on a $2.2 billion whopper
Singapore-headquartered agri-group Olam – who put in an excellent performance at TXF’s Commodity Finance Conference in Amsterdam three weeks ago, thank you – last week closed its $2.2 billion revolving credit facility (RCF). Many congratulations to you guys.
 
This is also at a time when the company is having to deal with Temasek gaining a controlling share of the company. Find out which banks came on board the RCF in the related news item.
 
 Puma prowls proudly
Puma Energy. What a secretive bunch they are! Must be something that Trafi passed on to them. So ask the company who the arrangers were on their recent $705 million RCF – no, sorry, top secret! Pah! Anyway, no big secret to us, so read about the mandated lead arranger group in our news item.
 
The transaction was a big draw for many in the market, and achieved something in the region of a 200% oversubscription. So proud the Puma shall remain.
 
 Vitol has fun down-under
Fitting that energy trader Vitol was also active last week – as it seeks to dig into the Australian market, much in the same fashion as Puma has done. Anyway, Vitol has been busy with a self-arranger (shock-horror!) $2.05 billion facility to fund its purchase of the downstream parts of Shell Australia. The deal closed successfully last week, with a 21-bank strong lending group.Check them all out in our news report. So Vitol – good on yer mate!
 
 Sonangol gets back in the groove
Guess it’s that time of the year again. Angolan state-owned oil company Sonangol launched its $2 billion pre-export finance facility into general syndication last week.
 
BNP Paribas and Standard Chartered are the coordinating MLA banks and have fully underwritten the facility. This year, it’s a seven-year affair though. Check out further detail in the news report.
 
 Nyrstar secures EFIC support for Port Pirie
On the export credit agency (ECA) front, the big story to hit last week was the news that EFIC, the Australian ECA, had agreed to provide support for Nyrstar’s redevelopment of its zinc smelter at Port Pirie in South Australia. The overall project is expected to cost in the region of $463 million.
 
The conversion of the existing site to an advanced metals recovery and refinery is big news for the region, hence the support of EFIC and the South Australian government. Read all about EFIC’s involvement and details of the proposed development in the news report. 
 
 China and AfDB sign landmark fund agreement 
The African Development Bank (AfDB) was a very busy institution last week, hosting its annual conference and signing a number of key new agreements. None were quite so big as the $2 billion agreement with the People’s Bank of China to establish a co-financing fund for the joint development of sovereign and non-sovereign-guaranteed development projects across Africa.
 
The so-called Africa Growing Together Fund puts a whole new dimension on China’s involvement on the African continent, and is a particularly good initiative by China to demonstrate its long-term involvement and commitment to assist in infrastructural and social projects. See all the details and comments from those involved in our news story.
 
 Pravin Advani becomes global head of GTLP
On the personnel front, congratulations is due to Pravin Advani at JP Morgan who has been promoted to the global head of sales for global trade and loan products. Pravin, who will continue to be based in Singapore, replaces David Conroy.

 Bienvenue à Paris!
The TXF tour continues next week as we welcome the global export finance community to Paris for our second ECA/DFI Finance Conference 2014 in the beautiful city of lights from 3-5 June. We will camp ourselves in Paris for most of the week as we welcome close to 400 members of the export finance community to the event with a programme to beat all programmes. And we will deliver the event in the wonderful and stunning venue that is the Pavillon Cambon Capucines.
 
We look forward to welcoming many of you in Paris. If you haven’t booked yet but would like to attend, we have a very limited number of places left. Just give us a call.

 And finally...
As AfDB is very much in the news, it may be an occasion to revisit its highly successful annual meeting which took place last week in Kigali, Rwanda. So how many people descended on Kigali? AfDB puts the numbers at close to 3,000. Wow! Kigali is a city with a population of just over one million, but that is a bit of a guestimate in anybody’s books. Hotels? Not enough, to be honest. Mmmmm. Anyway, we hope everybody got a bed for the night, and the event certainly helped the local economy in a big way.
 
The closing press conference of the annual meeting gave AfDB president, Donald Kaberuka, an opportunity to return to the concept of the Africa50 Fund.

According to Kaberuka, "The Africa50 Fund is a simple concept adopted after 12 months of preparation, based on the mobilisation of African savings to finance African infrastructure.”
 
He added: “For a long time, we have relied on external financing to fund our infrastructure. Now is the time for the African Development Bank to mobilise sovereign African savings – currently estimated at $1,000 billion – to build the Africa of tomorrow."
 
That’s all folks.
 
Cheers
 
Jonathan Bell

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