BNDES In Brazil Details Cuba Debt From Port Of Mariel

From BNDES (2 January 2019): 

We clarify that, through its lines of support for the commercialization of goods and services abroad, the BNDES does not finance projects in other countries, but exports of goods and services produced in Brazil, aiming at increasing the competitiveness of Brazilian companies, the generation of employment and income in the country, and the inflow of foreign exchange (contributing to the improvement, among other indicators, of the trade balance).

In any of the export support modalities, there is no remittance of funds abroad. The disbursements of funds are made in Reais (Brazilian currency), in Brazil, directly to the Brazilian exporter, based on the exports actually carried out and proven. The importer, when receiving the goods and services exported by the Brazilian company, instead of making the cash payment, direct to the exporter, recognizes the debt corresponding to the goods and services exported and authorizes BNDES to disburse the resources to the exporter, in his name in Reais and in Brazil. In disbursing the funds to the exporter, the BNDES becomes the creditor of the importer, who will repay the debt to BNDES, as disciplined in the financing agreement.

Five financing agreements were signed between the BNDES and the Republic of Cuba (the debtor of the operations), with the exporter, the Construction and Infrastructure Company (COI), a subsidiary of Construtora Norberto Odebrecht, the financing of exports of engineering goods and services to the Port of Mariel in Cuba, as described below:

Tranche 1: US$43,435,000.00 with annual interest 6.91%

Tranche 2: US$108,715,000.00 with annual interest 4.83%

Tranche 3: US$150,000,000.00 with annual interest 4.68%

Tranche 4: US$150,000,000.00 with annual interest 4.44%

Tranche 5: US$229,910,550.00 with annual interest 5.06%

Total: US$682,060,550.00

As mentioned in the previous response, financial collaboration contracts are denominated in US dollars. It is worth noting once again that, once Brazilian exports have been made and proven, the BNDES proceeds with the release of resources in Reais, in Brazil, directly to the Brazilian exporting agent.

The financing operations related to the Port of Mariel are intended to enable the export of Brazilian goods and services, within the scope of the BNDES-Exim Post-Shipment Financing Line, buyer's credit modality, to be used in the expansion and modernization works of the Port of Mariel and its access infrastructure.

Additionally, we would like to inform you that all export financing of goods and services for the construction of the Port of Mariel is guaranteed by the Export Credit Insurance (SCE), with BNDES being the beneficiary, granted by the Federal Government, through the International Affairs - SAIN of the Ministry of Finance, with funds from the Export Guarantee Fund (FGE).

It is important to note that the Export Credit Insurance is granted upon payment of a premium to the Union, whose costs are borne by the debtor in the Financing Agreement. In addition, we clarify that the SCE's coverage of exports financed by the BNDES is approved, for each operation, by the Export Financing and Guarantee Committee (COFIG), a collegiate body part of the Foreign Trade Chamber of the Presidency of the Republic -CAMEX.

There are portions of export financing for the Port of Mariel in arrears (due between June and October 2018), in the total amount of US$20.2 million. In 2019, BNDES has another US$70 million to receive.

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