Package Helps Keeps Temperatures In Check In Iraq

A recent assignment came through the offices of UK Trade & Industry (UKTI), the Government agency responsible for export promotion.

A UKTI advisor in the Midlands contacted TAEFL to introduce a client which manufactured cooling equipment for use with power generation systems. The company had received a significant order from Iraq, and held a Letter of Credit (LC) issued by the Trade Bank of Iraq.

The manufacturer required the LC to be confirmed (effectively a guarantee that it would be paid) by a UK bank, Unfortunately, the company’s current bankers considered the risk associated with Iraq to be too great, and declined to provide the confirmation.

With an order worth £600K to fulfil, UKTI identified Trade & Export Finance as an organisation that would be able to identify and negotiate with the institutions best able to provide the confirmation. TAEFL was able to bring two offers to the table. One offered ‘silent’ confirmation (where the cover is provided without reference to the issuing or negotiating bank activity behind the scenes). The other was a more conventional confirmation if the letter of credit were sent to the nomination bank in London.

The cost of confirmation was built into the pricing of the contract and our client was secure in the knowledge that it would receive payment when the goods were shipped . Trade and Export Finance Limited was appointed by the company to obtain more effective finance for the business.

Working with the manufacturer in this way has enabled TAEFL to examine first-hand the company’s funding requirements. That has led to Mark Runiewicz’s team at Trade & Export Finance being mandated to help it re-structure its entire banking arrangements.