The UK has initiated a huge GBP 2.5 billion trade facility (“Trade Facility”) for trade and related investment with Ukraine, which is managed by UK Export Finance (“UKEF”) in conjunction with the new Trade Treaty between Ukraine and the UK. This Trade Facility provides an excellent opportunity for Ukrainian companies to finance the growth of their businesses.
BENEFITS OF THE FACILITY
Through the Trade Facility, Ukrainian importers and British exporters can access funding for very long terms (up to 10 to 18 years, depending on the activity involved, but at least 2 years) at very reasonable interest rates. Up to 85% of the cost for a transaction can be so financed. The types of expenses that can be covered are very broad, including not just imports of goods and services, but also product development, working capital and other associated expenses. UKEF can flexibly finance a variety of transactions, including project financings.
WHAT UKEF CAN DO
UKEF is regularly rated as one of the world’s best export credit agencies (contact at: [email protected]). UKEF can enhance the credit worthiness of transactions and projects by using the very high UK sovereign credit rating to borrow at low rates in the international markets to on-lend to, or give guarantees for, Ukrainian buyers, as well as their sellers.
The UK can thereby meet the needs for most Ukrainian trade transactions and projects, including as Europe’s largest equipment manufacturer and a world leader in advanced aerospace, automotive, rail and marine design and engineering, among other areas.
DESIRABLE SECTORS
While UKEF can consider lending for most types of transactions and projects, UKEF is especially interested in supporting the following areas in Ukraine:
1) Agriculture and Aquaculture;
2) Transport Infrastructure and Construction, including for hospitals, bridges, “green” buildings, clean transportation, sustainable water and wastewater management;
3) Renewable Energy;
4) Health Care, including for the supply of vaccines and other pharmaceuticals;
5) Civil Aerospace and Aircraft;
6) Mining (but not for oil, gas and coal);
7) IT, including agritech, fintech, medical technology, educational technology, the Internet of Things, artificial intelligence, gaming, etc; and
8) Defence and Security, including to provide equipment for the Ukrainian Army, Navy and Air Force.
ELIGIBILITY CRITERIA
While past UKEF deals have financed transactions up to GBP 1.2 billion, many UKEF financings have been to support small and medium-sized enterprises (“SMEs”). The criteria to apply include:
1) Minimum 20% UK Content. Unlike most such credit agencies, UKEF requires only a minimum of 20% UK content in goods and services; and
2) Borrower Status. A borrower must have a creditworthy record, with three years of audited accounts, though exceptions can be made depending upon the situation, and this requirement for three years of accounts does not apply for project financings.
For further information on involving UKEF finance for your transaction, please contact Bate Toms at B. C. Toms & Co.
tel: (+38044) 278 1000
tel: (+38044) 490 6000
[email protected]
www.bctoms.com
