Finance and fund raising for export contracts

Due to the importance of the role played by extended credit in planning and executing major projects, international banks frequently employ engineers in their project finance departments, while engineering contractors often employ lawyers or economists to assist in contract negotiations. This paper is intended to introduce to engineers and technicians the basic concepts of finance for export contracts, and to summarise the ways in which such financing may influence engineering, planning and contractual decisions.

The various types of export credit are described, and the advantages of each system explained. Special reference is made to conditions regulating exports from the U.K. but the same principles apply to exports from other European and industrialised countries.

Certain projects involve guarantees, bonds and special insurance. In some cases, additional funds must be raised to supplement export finance and such instances are reviewed.