Export–Import Bank of China
中国进出口银行
TypePublic
IndustryBanking
Founded1994 (1994)
HeadquartersBeijing, China
Key people
ProductsFinancial services
Websiteenglish.eximbank.gov.cn
The Export–Import Bank of China
Simplified Chinese中国进出口银行
Traditional Chinese中國進出口銀行

The Export–Import Bank of China (中国进出口银行; Exim Bank) is one of two institutional banks in China chartered to implement the state policies in industry, foreign trade, economy, and foreign aid to other developing countries, and provide policy financial support so as to promote the export of Chinese products and services.

Established in 1994, the bank is subordinated to the State Council.[1]

Mission

The bank is a policy bank and along with other Chinese policy institutions like China Development Bank and Sinosure implement the economic policies of the government. The focus of the bank is to promote foreign trade and investment. Commercial lending forms the backbone of the bank. Commercial activity includes export credits mainly in the infrastructure fields (roads, power plants, oil and gas pipelines, telecom, and water projects) and investment loans for Chinese businesses to establish overseas in the energy, mining and industrial sectors.[2] Another function is to administer concessional loans which are no interest or very low interest loans provided as foreign aid by the Chinese government. Exim is the sole provider of Chinese government concessional loans.[2]

Exim does not publish figures for overseas loans. However, U.S. officials estimate that it finances more than the total export financing of the Group of Seven industrialized nations combined.[3] The Financial Times estimates that in 2009 and 2010, China Eximbank and China Development Bank (CDB) together signed loans of at least $110 billion to other developing country governments and companies, more than the World Bank over a similar period.[4]

Along the CDB and the Silk Road Fund, China Eximbank is one of the primary financing sources for Belt and Road Initiative development projects in Africa.[5]: 245 

Rival export financing institutions that have seen a decline in influence, such as the U.S. Export–Import Bank through Chairman Fred Hochberg, have complained that Exim Bank doesn't follow the export financing guidelines promulgated by the OECD and so has an unfair advantage.[3]

In 2015, China used its foreign exchange reserves to recapitalize Exim Bank, which in turn empowered it to make significant foreign loans.[6]: 70 

Foreign aid

The bank is a part of the Chinese foreign aid system and administers the Two Preferential Loan Program (两优贷款业务). The concessional loan (优惠贷款) and preferential export buyer's credit (优惠买方信贷) are the two main loan products under the preferential loan program.[7]

For concessional loans the bank advances a no interest or very low interest rate loan to a developing country government or agency to build a project (e.g. power plant, road, water treatment facility). The term of the concession loan is up to 20 years and a maximum grace period of 7 years is given. The preferential export buyer's credit is provided to a foreign borrower to purchase Chinese goods or services (e.g. construction contractor building the project). Like the concessional loan, this type of loan is also subsidized by the Chinese government. Interest rates are below market rates at around 3 to 6%. However, the preferential export buyer's credit is generally classified as a commercial loan rather than foreign aid even if the interest rate is very low because the purpose is to promote Chinese exports.[8] These two types of loans are a major part of the financing support for China's Belt and Road Initiative.[9]

During the Covid pandemic, the bank granted the government of Angola an undisclosed amount of debt relief.[10]

In 2022, the bank signed an agreement with Hong Kong realtor group ESR Group and to invest in ASEAN infrastructure projects.[11]

In 2023, the EXIM Bank of China has agreed to support Sri Lanka's debt restructuring efforts. The news follow's India's promise to also support Sri Lanka through the debt restructuring program.[12][13][14]

Organizational structure

Internal Departments

  • Executive Office
  • Human Resources Department
  • Business Development & Innovation Department
  • Corporate Business Department
  • Shipping Financing Department
  • Onlending Department
  • Planning & Financial Management Department
  • Evaluation Department
  • Auditing Department
  • Legal Affairs Department
  • International Business Department
  • Risk Management Department
  • Administrative Department
  • Supervision Office
  • Economic Research Department
  • Department of Special Account Financing
  • Corporate Business Department
  • Concessional Loan Department
  • Treasury Department
  • Information Technology Department
  • Compliance Department
  • Accounting Department
  • Workers Union
  • Software Development Department
  • Party & League Affairs Department

Business branches

There are a total of 21 branches of the bank.[15]

See also

References

  1. ↑ "Brief Introduction - The Export-Import Bank of China". Archived from the original on 2019-05-12. Retrieved 2017-04-01.
  2. 1 2 Wang, Jian-Ye (October 2007). What Drives China's Growing Role in Africa? (PDF). IMF Working Paper.
  3. 1 2 Reddy, Sudeep (12 January 2011). "U.S. Export Financing Challenges China". Wall Street Journal. Retrieved 11 January 2017.
  4. ↑ Dyer, Geoff; Anderlini, Jamil; Sender, Henny (17 January 2011). "China's lending hits new heights". Financial Times. Retrieved 11 January 2017.
  5. ↑ Murphy, Dawn (2022). China's Rise in the Global South: the Middle East, Africa, and Beijing's Alternative World Order. Stanford, California: Stanford University Press. ISBN 978-1-5036-3009-3.
  6. ↑ Liu, Zongyuan Zoe (2023). Sovereign Funds: How the Communist Party of China Finances its Global Ambitions. The Belknap Press of Harvard University Press. doi:10.2307/jj.2915805. ISBN 9780674271913. JSTOR jj.2915805. S2CID 259402050.
  7. ↑ Handbook on China and Developing Countries. 2015. p. 207.
  8. ↑ "Export Finance Activities by the Chinese Government" (PDF). European Parliament.
  9. ↑ Normative Readings of the Belt and Road Initiative: Road to New Paradigms. Springer International Publishing. 2018. p. 119. ISBN 978-3-319-78017-7.
  10. ↑ "Angola looks at refinancing as it faces higher repayments on Chinese loans". South China Morning Post. March 11, 2022.
  11. ↑ "ESR, China Eximbank close US$1 billion infra fund". theasset.com. Retrieved 2022-12-05.
  12. ↑ "After India, China gives financing assurances to Sri Lanka for IMF bailout package". Business Today. 2023-01-22. Retrieved 2023-01-23.
  13. ↑ "Sri Lanka president, China Exim Bank chief discuss debt issues". EconomyNext. 2023-01-12. Retrieved 2023-01-23.
  14. ↑ PTI (2023-01-22). "After India, China gives financing assurances to Sri Lanka for IMF bailout package". The Hindu. ISSN 0971-751X. Retrieved 2023-01-23.
  15. ↑ "Business Branches". The Export Import Bank of China.
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