The Inter-American Development Bank (IDB) announced today the issuance of a guarantee to Banco BICE (Chile) in its first transaction involving a Chilean Confirming Bank under its Trade Finance Facilitation Program (TFFP).
In this intra-regional trade finance transaction, the TFFP guarantee helped facilitate an export of pipelines for approximately US$775 thousand from a Chilean tube manufacturer to an Ecuadorian company in the water sector. By covering Banco BICE’s commercial and country risks in the confirmation of a documentary credit, the TFFP guarantee enabled Banco BICE to directly engage in this transaction with the Ecuadorian TFFP Issuing Bank Banco de Guayaquil.
By facilitating communication and intra-regional trade business between banks within the Latin American and Caribbean region, the TFFP contributes to the IDB’s overall objective of fostering regional integration.
TFFPLaunched and rolled-out in 2005, the TFFP is an effective tool for the IDB to support economic growth through the expansion of financing available for international trade activities of Latin American and Caribbean countries. The TFFP currently comprises a network of about 120 Confirming Banks belonging to 55 different international banking groups in over 35 countries, and 29 Issuing Banks in 14 Latin American and Caribbean countries with almost US$539 million in approved credit lines. To date, the IDB has issued guarantees for approximately US$205 million in support of more than 266 individual international trade transactions totaling US$274 million.