Export credits supported by official Export Credit Agencies (ECAs) in developing countries often finance large-scale projects in developing countries. Even though export credits cannot be assimilated to development finance given their commercially motivated and demand-driven nature, they still play an important role – by mitigating risks – in providing access to capital and enabling projects in key segments of the economy (e.g. industry, infrastructure).
According to the DAC statistics, the United States, Germany and Canada are by far the largest providers of export credits in support of activities in developing countries. Clearly, middle-income countries belong among the main beneficiaries of export credit operations.
Sectorial and income group allocation of export credits to developing countries, 2010-2015
Source: DAC statistics, gross disbursements 2010-2015.
OECD member countries’ ECAs follow environmental and anti-corruption standards developed by the Working Party on Export Credits and Credit Guarantees, as well as the financing guidelines of the Arrangement on Officially Supported Export Credits. Established in 1878 to avoid potential trade distortions (e.g. through the use of financial subsidies) and ensure fair competition, the purpose of the Arrangement is also to provide a framework for the orderly use of officially-supported export credits (e.g. minimum interest rates, risk fees and maximum repayment terms) and the orderly use of tied aid.
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