CONFIDENTIAL
Background Note No 5
ECGD liabilities on this group will total some '£700m (including interest). Moreover if demand for power continues to expand at 10% p.a. there will be the opportunity in 1981 for a further generating plant order worth at least £300m.
Only in 3 markets, Brazil, Poland and USSR, do overall ECGD liabilities in respect of buyer credit business exceed £700m. In addition there are large commitments with the Hong Kong Transit Corporation: £100m for Phase I which is to be commissioned in February and £80m for Phase II. ECGD has also supported the sale of Rolls Royce RB 211 engines to Cathay Pacific Airways.
FOREIGN CURRENCY FINANCING
The greater part of ECGD's business is being financed in Hong Kong Dollars and Hong Kong is the only market outside the USA where financing in local currency has been supported. The availability of HK % finance on a long term basis is limited and for future substantial contracts ECGD will require the finance to be arranged in US dollars, in accordance with its normal foreign currency financing policy.
INVESTMENT INSURANCE
е To date ECGD has issued only one Investment Insurance Agreement on Hong Kong for an investment of £40,000. Demand for the Investment Insurance Facility is minimal, probably due to Hong Kong's status of Crown Colony.
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NB Details of ECGD Limits and Commitments are Confidential.
CONFIDENTIAL
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