EX-IM Bank approves $180 million in insurance for Iraq-bound grain
The U.S. Export-Import Bank board approved an insurance policy for CoBank, ACB for up to $180 million in letters of credits to support American exports to Iraq.
The bank said in a July 20 statement the insurance will be used to support trade financing for CoBank, ACB, a cooperative bank and part of the U.S. Farm Credit System. Under the policy, the EX-IM Bank will support letters of credit issued by the Trade Bank of Iraq in favor of U.S. exporters. Telwar International of Brentwood, Tenn., plans to use this program to buy $27 million worth of bulk rice and wheat monthly.
The EX-IM Bank’s action was taken as part of its $500 million short-term insurance program for the Trade Bank of Iraq. This program provides for bank letter of credit insurance policies, which provide assurance to U.S. companies that they will receive payment for goods and services exported to Iraqi buyers.
EX-IM Bank can also support U.S. exports to Iraq through its Working Capital Guarantee Program under which it will consider applications to support pre-export activities of subcontractors, particularly small businesses, operating under U.S. government-funded reconstruction projects.
In addition, the bank will consider application for financing U.S. exports to Iraq under its loan guarantee, working capital, and credit insurance programs if there is a creditworthy source of repayment in a third country.