INDONESIA EXIMBANKS ROLE TO SUPPORT TRADE AND INVESTMENT BETWEEN - - PowerPoint PPT Presentation
INDONESIA EXIMBANKS ROLE TO SUPPORT TRADE AND INVESTMENT BETWEEN INDONESIA AND AFRICA ICE BSD City, 17 October 2019 Board of Directors of Indonesia Eximbank Sinthya Roesly Chairperson of the Board of Directors concurrently Executive
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Sinthya Roesly Chairperson of the Board of Directors concurrently Executive Director Suminto
Member (Ex-Officio Ministry of Finance of the Republic of Indonesia)
Arlinda Imbang Jaya
Member (Ex-Officio Ministry of Trade of the Republic of Indonesia)
Arif Budimanta Member
(Independent)
Felia Salim Member
(Independent)
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Sinthya Roesly Chairperson of the Board of Directors concurrently Executive Director
Dikdik Yustandi Managing Director I Djoko Retnadi Managing Director II Agus Windiarto Managing Director III Chesna F Anwar Managing Director V
Yadi Jaya Ruchandi SEVP I
SEVP II
Henry Sihotang Managing Director IV
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Special Institution Status
Indonesia Eximbank operates independently, in accordance to Law No. 2 of 2009 (Lex Specialist)
Government Ownership
100% owned by government – the capital of IEB is not divided into shares
International Credit Ratings
Office Network Mandate & Responsibilities
To support national export programmes through national export financing; in the form of financing, guarantee and insurance
Indonesia Eximbank was established based on Law No. 2
Lembaga Pembiayaan Ekspor Indonesia (Indonesia Eximbank) Main Activity History of Indonesia Eximbank 1999 2009 Present
IEB’s predecessor Bank Ekspor Indonesia (“BEI”) established IEB officially operated on September 1, 2009 to encourage national exports
Governance Structure
“One Board-One Star”
Accelerate national export performance through National Export Financing Enhancing export competitiveness & excellences
(Financing, Guarantee Insurance) (specifically in SMEs segment) through Advisory Services/ Capacity Building, Advocacy and Knowledge Management)
General Assignment (Commercial)
Internal Solid Process, Policy, People, Infrastructure Solid Clients Solid Projects External
Special Assignment (National Interest Account)
Solid Knowledge/Analytics Solid Program Skillful HR/Business Player Innovation + Creativity Provide facility to support export ecosystem
Vocational Activity)
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University Network for Indonesia Export Development (UNIED) Export Call Centre National Export Dashboard (NED) Piloting Desa Devisa Piloting Regional Champion Joint Research (Domestic + International) Eximbank Forum & Exchange Program Office of Export Coordination -KBEI (National Interest Account & FORSA (Coordination Platform ) / IEB ECO-e (Export Center of Excellence) Vocational Training Export Digital Handholding Program (DHP)
Potential / Key Programs 2019 for SDG’s & Financial Inclusive
Developmental Impact Performance
(∆ Export, ∆ GDP, Employment, Decrease in Index Gini etc)
Number of Exporters Non-Traditional Market Penetration Financial Performance
The Performance Indicators Macro Context : National Program
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Become a credible Eximbank in encouraging national exports that are highly competitive at the global level
Encouraging good business climate sustainability that is conducive to a sustainable national export growth Providing national export financing services as well as quality consulting services as a solution to Indonesia's export needs Improving the ability of businesses, including small and medium enterprises, to produce good quality and competitive export-oriented products
Implementation of Mandates Institutional Leadership Institutional Positioning
Providing assistance needed by parties in the framework of exports in
and / or other businesses that support exports (Aticle 13 clause 1a) Providing financing for transactions or projects that are categorized as non-bankable, but have prospects in increasing national exports (Article 13 clause 1b) Helping to overcome the obstacles faced by banks or financial institutions in providing financing for exporters who are commercially potential and / or important in Indonesia's economic development (Article 13 clause 1c) Providing guidance and consulting services to banks, financial institutions, exporters, export goods producers, especially SMEs and Export Oriented SMEs (Article 13 clause 2a) National Export Financing (Article 5) Financing (Article 5 verse 1a) Guarantee (Article 5 verse 1b and Article 7) Advisory Services (Pasal 13 verse 2a)
Law No. 2 Year 2009 Law No. 21 Year 2011 Law No. 23 Year 1999 “100% owned by the Government, capital is not divided into shares“
Government of Indonesia through Ministry of Finance of the Republic of Indonesia
Regulation, Policy and coaching Institution Plan Regulation Supervision Payment system Foreign Exchange and Foreign Debt
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Indonesia Financial Services Authority The Central Bank of the Republic of Indonesia
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Capital Support From State Budget Liquidity Support From Ministry Of Finance Grants Under State Budget Law Net Profit Retention Republic of Indonesia Law 2 / 2009 Article 19
Government Regulation No 9 / 2011 Article 2 and 25
Republic of Indonesia Law 2 / 2009 Article 23 (1) Republic of Indonesia Law 2 / 2009 Article 21 In the event that IEB’s capital becomes less than IDR 4 trillion, the Government shall cover the deficiency from the state budget
will provide financings to IEB in accordance to as stated or stipulated in the Law on the State Budget
Finance is essentially the lender of last resort to IEB The Government may provide grants to IEB according to provisions as stipulated or determined by the State Budget Act The surplus allocation percentage shall be as follows:
and Special Purpose Reserve
and tantiem and dividend
Source: Republic of Indonesia Law No.2 of Year 2009 on Lembaga Pembiayaan Ekspor Indonesia (Law No.2/2009) Government Regulation (‘PP’) No. 9/2011 on Procedures for Granting loans from The Government of Indonesia to IEB
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injection from 2010 – 2019 is IDR13,8 trillion (eq. +/-USD950 million).
regulation No.164/PMK.06/2013
Growth of Housing Sector and Foreign Exchange.
support priority sector including generating foreign exchange.
concerning the Guidelines for Calculating Risk-Weighted Assets for Credit Risk with Standard Approach.
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Financing
Overseas Financing;
Domestic Financing
Credit Export-Oriented SME Financing;
Credit
Syariah Financing
Guarantee
for Bank and Financial Institution
Insurance
Protection
Advisory Services
New Exporter (CPNE)
Responsibility (CSR)
Project Development Facility
Special Assignment
National Interest Account (NIA)
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Indonesia Eximbank has extensive correspondence banks network
in
worldwide
Banks / Financial Institutions Representing Indonesia Eximbank in international forum:
Development FI (G-NEXID)
Export Credit
Club (IDFC)
Global Bank Multilateral Agency Exim Bank
JBIC, Chexim, Afrexim, Kexim, India Eximbank, Thai Exim, India Exim, VDB, Malaysia Eximbank etc. ADB, IDB, IFC, etc SCB, HSBC, Citibank, Commerzbank, MUFG, ICBC, OCBC, ANZ, FAB, etc.
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T R A N S F O R M P O L I T I C A L T I E S I N T O C O N C R E T E E C O N O M I C T I E S
Indonesia’s Export to Africa Indonesia’s Import from Africa Trade Balance
crude oil prices in combination with the vulnerable Rupiah in 2018 imply a burden on imports.
Africa is projected to have the largest population growth of any geographical region by 2050, which will have important consequences for the continent’s economic development.
Source: www.trademap.org
T R A N S F O R M P O L I T I C A L T I E S I N T O C O N C R E T E E C O N O M I C T I E S
Indonesia’s Export to Africa: By Country Indonesia’s Export to Africa: By Product
Africa Aggregation 2.64% Other Countries 97.36%
Indonesia's Export Destinations (2018)
Egypt 21.71% South Africa 13.56% Nigeria 8.85% Kenya 6.36% Tanzania, United Republic of 5.53% Benin 4.93% Djibouti 4.44% Algeria 4.19% Togo 3.11% Ghana 2.55% Other African Countries 24.78% Animal or vegetable fats and oils (dominated by palm oil) 51.53% Paper and paperboard 7.85% Soap, washing preparations 4.70% Man-made staple fibres 3.58% Vehicles other than railway 3.53% Machinery, mechanical appliances 2.49% Rubber and articles thereof 2.39% Coffee, tea, maté and spices 2.02% Articles of iron or steel 1.49% Organic chemicals 1.44% Other Products 18.98%
Indonesia’s Import from Africa: By Country Indonesia’s Import from Africa: By Product
Africa Aggregation 3.44% Other Countries 96.56%
Indonesia's Import Origins (2018)
Nigeria 38.90% South Africa 16.45% Angola 10.76% Algeria 5.73% Sudan 3.72% Congo, Democratic Republic of the 2.82% Libya, State
2.54% Zimbabwe 2.26% Egypt 2.15% Côte d'Ivoire 2.09% Other African Countries 12.57% Mineral fuels, oils and products of their distillation 66.18% Iron and steel 11.92% Cocoa and cocoa preparations 3.76% Pulp of wood 2.04% Cotton 1.78% Coffee, tea, maté and spices 1.76% Tobacco and manufactured tobacco substitutes 1.70% Salt; sulphur; earths and stone 1.36% Ores, slag and ash 1.22% Oil seeds and oleaginous fruits; misc. grains 1.21% Other Products 7.06%
Source: www.trademap.org
S T R E N G T H E N I N G T H E C O M P R E H E N S I V E S T R A T E G I C P A R T N E R S H I P
Creating more governmental collaboration and economic cooperation in G to G and B to B level to identify market demand and potential trade transaction in Africa. The market demand identification needs to be prioritized based
potential business, representation or food print of Indonesian business player in Africa, and involving Indonesia Eximbank as intermediary, facilitator and aggregator in increasing Indonesian export in African region. Improving role of Indonesia Eximbank to support international trade transaction and
and insurance cover as enabler for existing risk perception which can be the barrier of Indonesia Africa international trade. Creating more business collaboration among Indonesia Eximbank, Multilateral institution and financial institution such as Afreximbank, Africa Development Bank, Islamic Development Bank and other insurance or guarantee companies to structure the possible and workable transaction scheme in order to improve the capacity and capability of Indonesia Eximbank for supporting international trade transaction and outbound investment.
To strengthen existing cooperation, Indonesia need to take strategic action and breakthrough in international trade and economic cooperation
C H A L L E N G E S A N D O P P O R T U N I T I E S Identify market demand To understand and have the same perception on the potential business and transaction
How to get market accessibility as well as prepare for feasible and workable financing scheme including on how Indonesia Eximbank together with multilateral institution are able and eligible to support the potential transaction in Africa
But, if we have the same perception It would create an opportunity and bigger potential business that can be executed in term of financing for trading and outbound investment
E X P L O R I N G P O T E N T I A L C O O P E R A T I O N O N I N F R A S T R U C T U R E S E C T O R
The potential cooperation which can be explored is for the infrastructure sector which Indonesia had experienced for 5 years during President Joko Widodo administration to share with fellow African countries primarily
speed up the development of infrastructure sector where it’s also included support from Indonesia construction company to build infrastructure in Africa. In
hand, Indonesia Eximbank and other multilateral institutions and/or local bank in Africa are keen to provide financing, insurance and guarantee scheme that feasible and workable In addition, it is very necessary to have G to G agreement and B to B cooperation to mitigate the risk of uncertain condition such as trade war, exchange rate fluctuation, and many factors which still happening in the world
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Type of Agreement Focused Country Credit Limit Explanation
Framework Agreement on Credit Line Facility between Indonesia Eximbank and The African Export- Import Bank (Afreximbank) All African Countries each valued at USD 100 Million Framework Agreement on Credit Line Facility between Indonesia Eximbank and The African Export-Import Bank (Afreximbank) underlines the cooperation between the two institutions in providing credit line facility reciprocally whereby each valued at USD 100 Million that can be used for financing and guaranteeing trade transactions of goods and services as well as investment in projects, between Indonesia and Africa. This cooperation is expected to be one of the solutions in solving constrains faced in the financing activities, payment guarantee and export performance guarantee, so that it can significantly increase the trade transactions between Indonesia and African countries. Letter of Credit Renegotiation / Rediscounting Services Agreement between Indonesia Eximbank and Standard Chartered Bank Nigeria, Egypt, South Africa, Ivory Coast, Mauritius, Uganda, Kenya, Ghana, Tanzania and other African countries within the footprint of Standard Chartered Ban USD 100 million The agreement between Indonesia Eximbank and Standard Chartered Bank provides Indonesian exporters, through Indonesia Eximbank, with payment assurance through access to immediate disbursement of Letter of Credit to meet working capital requirements. The partnership between Standard Chartered Bank with its long standing legacy in Africa and Indonesia Eximbank with the commitment to support Indonesian exporters further cements confidence in establishing direct trade relationship between Indonesia exporters and African importers.
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Type of Agreement Focused Country Credit Limit Explanation
Master Participation Agreement for Trade Transaction between Indonesia Eximbank dengan Commerzebank Banks/ financial institutions incorporated in African state USD 122,8 million The Master Participation Agreement for Trade Transation between Indonesia Eximbank and Commerzbank is a collaboration between financial institutions in order to manage the risks arising from trade transactions between Indonesia and Africa. With experience and networks owned by Commerzbank in Africa, this partnership has become one of the infrastructure owned by Indonesia Eximbank to support trade enhancement between Indonesia and Africa. Memorandum of Understanding on Cooperation between Indonesia Eximbank and The Islamic Corporation for the Insurance of Investment and Export Credit IDB members countries and/or major muslim countries, such as Algeria, Libya, Niger, Nigeria, Cameron, Chad, Mozambique, Sudan, Tunisia, Egypt.
which both Indonesian companies and companies located in member countries of ICIEC participate and for which either or both of the Parties may provide trade or investment insurance
continuous review and discussion on joint operations between the Parties. Global Trade Finance Program between Indonesia Eximbannk and The International Finance Corporation (The World Bank Group) Angola, Benin, Burkina Faso, Burundi, Cameroon, Central African Republic, Chad, Pantai Gading, Congo, Gambia, Ghana, Guinea, Kenya, Rwanda, Senegal, Sierra Leone, Tanzania, Togo,
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Disclaimer: This presentation and the information herein are provided in confidence, for the sole purpose of the disclose materials, and may not be disclosed to any third party or used for any other purpose without the express written permission of the disclosing party