The Inter-American Development Bank (IDB) is strengthening its partnership with China after the first year of the country’s membership with the Bank. Two Chinese banks, the Agricultural Bank of China (ABC) and the Export-Import Bank of China (China Eximbank) joined the IDB Trade Finance Facilitation Program (TFFP) as confirming banks. ABC’s Executive Director Yang Kun, China Eximbank’s Vice President Su Zhong, and IDB’s President Luis Alberto Moreno signed the agreement during the IDB’s 2010 Annual Meeting in Cancun, Mexico.
By joining TFFP, both banks will be able to further expand their trade finance activities with Latin America and the Caribbean and foster the bilateral trade flows between these two regions. The ties with China are strengthened as the Agricultural Bank of China begins to work with IDB’s trade finance program and collaboration with China Eximbank is strengthened following a partnership MoU signed in 2009.
“We are very pleased to see two more Chinese banks joining IDB’s TFFP program following China’s membership at the IDB in January 2009. The participation of the Agricultural Bank of China and the Export-Import Bank of China in the program is an example of how the IDB is expanding its partnerships in China and contributing to the economic and financial integration process between these two regions”, said Bernardo Guillamon, Manager of the Office of Outreach and Partnerships (ORP). The ORP is facilitating the strengthening of the IDB’s partnership with the Chinese Banks and the IDB is now more effectively becoming the platform for doing business in the region.
Agricultural Bank of China (ABC)
Agricultural Bank of China (ABC), established in 1951, is one of the leading financial players in both China’s urban and rural markets. With the largest network across China and a broad range of international capabilities, ABC offers a distinct advantage as a gateway linking China and the world in diversified financial services of commercial banking, investment banking and insurance services. In 2009, ABC's various businesses including the intermediary business in international trade finance enjoyed rapid development and its operating performance improved significantly. ABC took the 9th place in China's TOP 500 enterprises, with its profitability ranking 8th in TOP 100 banks of the world. Currently, ABC has more than 20,000 branches, sub-braches and outlets, over 450,000 employees and has established correspondent banking relationships with 1,211 banks worldwide.
The Export-Import Bank of China (China Eximbank)
China Eximbank is a government policy bank enjoying the same international credit ratings as China's sovereign ratings. As an important force in promoting foreign trade and economy and a significant component of the financial system, China Eximbank has been acting as a key channel of policy financing for both Chinese import-and- export of mechanic and electronic products, complete sets of equipment, and high- and new-tech products and undertaking of offshore construction contracts and overseas investment projects by Chinese companies. Meanwhile, the Bank is a major onlending bank of foreign government loans and the only operating bank for Chinese Government Concessional Loan.
Launched and rolled-out in 2005, the TFFP is an effective tool for the IDB to support economic reactivation and growth through the expansion of financing available for international trade activities of Latin American and Caribbean (LAC) countries. The TFFP currently comprises a network of 227 Confirming Banks belonging to 87 different international banking groups in more than 53 countries, and 62 Issuing Banks in 18 LAC countries with $1.01 billion in approved credit lines. To date, the IDB has issued guarantees in support of 876 individual international trade transactions totaling $830 million.