§ 89. Mr. J. H. Osbornasked the President of the Board of Trade what consideration the Export Credits Guarantee Department has given to the insurance of capital projects undertaken by overseas subsidiary companies of British principals purchasing British-manufactured capital equipment, and using British technologies and skills against normal political risks as defined by the World Bank in conjunction with the International Chamber of Commerce.
§ Mr. JayE.C.G.D. cover is available for sales by or to overseas subsidiary companies effectively controlled by British principals.
§ 90. Mr. J. H. Osbornasked the President of the Board of Trade what steps he proposes to take to encourage the extension of long-term loans under Section 2 of the Export Credits Guarantee Department Act with a view to promoting the sales of British plant and capital goods, and particularly those goods supplied by the chemical plant and steel plant manufacturers who are faced with contracting order books.
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§ Mr. JayCommercial long-term loans for sales of British plant and capital goods are encouraged under E.C.G.D.'s Financial Guarantee scheme which was introduced specifically for the purpose described by the hon. Member.
§ Mr. J. H. Osbornasked the President of the Board of Trade what was the value of exports covered by the Export Credits Guarantee Department in each of the years ending 31st January, 1964, 31st January, 1965, 31st January, 1966; and what percentage of total exports this amounted to in each year.
§ Mr. JayThe values were:
£m. Percentage of British Exports Year ending 31st January, 1964 1,062 25 Year ending 31st January, 1965 1,146 26 Year ending 31st January, 1966 1,365 28
§ Mr. J. H. Osbornasked the President of the Board of Trade what was the total value of guarantees outstanding under the Export Credits Guarantee Department cover at 31st January, 1966, and under Section 1, Section 2, and Section 3, respectively; and what was the increase in guarantee cover in total and under each section during the year ended 31st January, 1966.
§ Mr. JayFigures are not readily available for 31st January, 1966. The total liabilities under Section 1 and Section 2 at 31st December, 1965 were as follows. Increases over the corresponding figures at 31st December, 1964 are shown in brackets.
£ million Section 1 1,190.7 (155.6) Section 2— Under guarantees 353.8 (51.1) Under economic assistance agreements 281.4 (35.3) Totals 1,825.9 (242.0) Section 3 provides for financing business guaranteed under Section 1 or Section 2 or economic assistance agreements made under Section 2. The total outstanding at 31st December, 1965 was £281.4 million, all related, as shown above, to economic assistance agreements.
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§ Mr. J. H. Osbornasked the President of the Board of Trade what steps the Export Credits Guarantee Department is now taking to make known to British exporters and manufacturers and their trade associations those parts of the world where there is limited Export Credits Guarantee Department cover for medium- and long-term loans because of excessive political and economic risks, and where there is a high guarantee premium; and whether he will publish this information in the next report of the Export Credits Guarantee Department.
§ Mr. JayE.C.G.D. has a mailing list of about 900 trade associations, which are kept informed of major changes in the availability and terms of cover. Credit insurance brokers are kept similarly informed. All holders of Comprehensive Guarantees receive quarterly a WorldWide Schedule showing the premium rates and conditions of cover for each market. Exporters are encouraged to approach E.C.G.D. at an early stage in their negotiations; they can get an indication of the terms on which cover is likely to be available for particular business, including the approximate premium, on request—by telephone, if necessary.
I do not consider that publication of this information is necessary or desirable.
§ Mr. J. H. Osbornasked the President of the Board of Trade to what extent it is the policy of the Export Credits Guarantee Department to favour proposals for insurance guarantee to cover those projects which involve the sale of plant and equipment tied to British technology and know-how to overseas subsidiary companies of British principals, as against foreign principals, in those areas where only limited Export Credits Guarantee Department cover is available.
§ Mr. JayThis situation has not arisen. If it did, the continuing advantages of one transaction over another would be taken into account.
§ Mr. J. H. Osbornasked the President of the Board of Trade what discussions he is having with members of the Berne Union to prove that long-term loans, in terms of period of repayment, rate of interest, and rate for guarantee cover made available to British capital plant manufacturers, are no less advantageous than those available to their foreign com- 296W petitors; and what are the maximum terms now offered by the Export Credits Guarantee Department.
§ Mr. JayThe Export Credits Guarantee Department has a constant exchange of information with other members of the Berne Union on credit terms currently being offered. I am satisfied that the Financial Guarantee Scheme, under which the Department gives guarantees to encourage long-term loans to overseas buyers of British capital plant, provides terms no less advantageous than those available to foreign competitors in respect of periods of repayment, rate of interest and rate of premium. The maximum terms guaranteed by E.C.G.D. under the Financial Guarantee Scheme are now 15 years from contract.