PhilExim extends P6.12-B guarantees

The Philippine Export-Import Credit Agency (PhilExim) has extended outstanding guarantees worth P6.12 billion in the six months ending June 2006, putting the government financial institution on track to meet its targets this year.

In 2005, PhilExim extended P11.56 billion worth of guarantees to big-ticket projects and direct and indirect exporters. This year, it is looking at a record P16-billion performance.

In the same six-month period, direct outstanding loans reached P122.1 million. It also made available P450 million for the development of small and medium enterprises (SMEs) in the export market.

"Wholesale lending is conceived with the hope of enhancing credit and capability building assistance to SMEs, including sub-contractors and suppliers," PhilExim president and chief executive officer Virgilio R. Angelo said.

The wholesale lending program is a short-term working capital credit facility designed to support the urgent financing needs of SME exporters. It involves accreditation of partner conduits such as rural banks, thrift banks, cooperative rural banks, development finance firms, and exporters’ organizations such as primary associations, federations, chambers, chapters or cooperatives.

These conduits will, in turn, do retail lending directly to exporters and sub-contractors. Equally important component of the program is the provision of capacity building services through a soft loan facility which aim to strengthen the capabilities of both the conduits and SME exporters in the areas of management, technology, and marketing.

PhilExim is a line agency of the Department of Finance with the primary purpose of extending sovereign guarantees on loans by SMEs as well as selected sectors of the business society for foreign or domestic loans.

Some its guarantee products include pre-shipment and post-shipment guarantees, export loan guarantees, term loan guarantees, short-term trade-related loan guarantees, trade fair financing guarantees, and a P1-billion guarantee facility for garment exporters.