$500m Allocated to Promote Iran Non-Oil Exports

EghtesadOnline: As a part of a non-oil export promotion package, the National Development Fund of Iran has allocated $500 million to the Export Development Bank of Iran for distribution among Iran's exporting industries.

News ID: ۷۴۲۹۳۷

23 July 2017

"In order to renovate exporting industries' machinery and equipment, NDFI appointed EDBI as the agent bank to offer the aforementioned fund as investment and loans," the bank's CEO was quoted as saying by EDBI's official website.

Ali Salehabadi also noted that the allocation of these loans will continue until the end of the current Iranian year (March 20, 2018).

In June 2017, the Iranian Parliament had approved a bill allowing the government to take out $1.5 billion from NDFI for a plan to create jobs in rural and nomadic areas in the fiscal 2017-18, Financial Tribune reported.

The money from the sovereign wealth fund will be extended as loans for job creation and rural development. No further details of the plan have been announced.

"EDBI has granted new credit lines to banks in four countries and is ready set up new ones with other foreign banks if the exporters demand it," the bank's CEO said.

Salehabadi noted that a new credit line for the Paris branch of Tejarat Bank worth €25million has been recently approved, which could be used to trade with the whole of Europe.

"A short-term €100 million credit line has been considered for the Export-Import Bank of Korea (Korea Eximbank) while we agreed to open a €75 million credit line for the Turk Eximbank, which will soon be finalized," he said.

In February, Salehabadi said the bank is holding negotiations with the Export-Import Bank of India, Eximbank of Russia and another unnamed Russian bank.

The EDBI chief also announced signing memorandums of understanding with the Indonesian Eximbank and the Eximbank of Hungary.

Salehabadi noted that an $18 million credit line will be opened with an Iraqi bank, saying the credit line aims to expand Iran's exports to the neighboring Arab country and that EDBI is ready to allocate more lines of credit to that country if other Iraqi banks meet the capital adequacy ratio.

"This way, Iranian exporters can cash in the entire amount of their exports through this credit line and the Iraqi bank will repay it over a maximum period of two years in four consecutive tranches every six months," he said, adding that the repayment duration depends on the type of the exported commodity.