Bank Hapoalim signs China export credit line

The Agricultural Bank of China is "a commercial bank in every sense," and was not chosen for any specifically agricultural reasons, bank sources said.

By DANIEL KENNEMER
March 21, 2006 06:53
2 minute read.
bank hapoalim logo 88

bank hapoalim logo 88. (photo credit: Courtesy)

 
X

Dear Reader,
As you can imagine, more people are reading The Jerusalem Post than ever before. Nevertheless, traditional business models are no longer sustainable and high-quality publications, like ours, are being forced to look for new ways to keep going. Unlike many other news organizations, we have not put up a paywall. We want to keep our journalism open and accessible and be able to keep providing you with news and analyses from the frontlines of Israel, the Middle East and the Jewish World.

As one of our loyal readers, we ask you to be our partner.

For $5 a month you will receive access to the following:

  • A user experience almost completely free of ads
  • Access to our Premium Section
  • Content from the award-winning Jerusalem Report and our monthly magazine to learn Hebrew - Ivrit
  • A brand new ePaper featuring the daily newspaper as it appears in print in Israel

Help us grow and continue telling Israel’s story to the world.

Thank you,

Ronit Hasin-Hochman, CEO, Jerusalem Post Group
Yaakov Katz, Editor-in-Chief

UPGRADE YOUR JPOST EXPERIENCE FOR 5$ PER MONTH Show me later

Bank Hapoalim signed an agreement with the Agricultural Bank of China to provide a line of credit to fund Chinese purchases of equipment and services from Israeli exporters, the bank said Monday. Sales of goods and services in such fields as telecommunications, agricultural equipment, infrastructures, environment, medical equipment and education would benefit from the arrangement. "This agreement joins four other credit agreements already active between Bank Hapoalim and leading banks in China, which enables the bank and the exporter greater flexibility in funding export deals from Israel to China," said Bank Hapoalim business department director Yaakov Orbach. The Agricultural Bank of China is "a commercial bank in every sense," and was not chosen for any specifically agricultural reasons, bank sources said. The loans will provide long-term funding covering the full investment of projects valued at a minimum of $500,000. Bank sources indicated there was no formal maximum. While the initial deposit, covering 15% of the investment, would be paid back within one year, the remainder of the loan would be paid back within seven, 10 or 12 years, depending on the value of the project. Each agreement approved would require a specific funding agreement, which would take the form of a pre-formulated electronic exchange between Bank Hapoalim and the Agricultural Bank of China, allowing the banks to cut costs and shorten the process. The partnership with a Chinese bank also would ensure easier navigation through the country's bureaucracy, bank sources indicated. The agreement was signed in the context of the preferential conditions provided by the Second Financial Protocol signed between Israel and China and managed by IFTRIC (The Israel Foreign Trade Risks Insurance Corporation Ltd.), a government company. Signed in 1996 and activated in 2002, the initial Financial Protocol was expanded and renewed in 2004 in the context of the Second Financial Protocol, bringing the total framework provided to $550 million. The funding has primarily aided exports of medical equipment, said Amiram Halevy, director of the Asia & Pacific Division at the Industry, Trade and Labor Ministry's Foreign Trade Administration. Bank Hapoalim has carried out more than 90% of the funding for exports to China arranged through the financial protocols, the bank said. Trade between Israel and China totaled $2.99 billion in 2005, of which Israeli exports accounted for $725m., down 5.7% from 2004, the ministry said. Machinery and equipment purchase fell by more than one-quarter, while medical and optical products fell by nearly one-fifth. Chemical product sales, however, grew 40%, while diamond sales rose 12% and plastics rose 54%. Halevy explained that the reduction in exports to China was a result of the Chinese government's successful efforts to cool down the country's avid domestic demand, and predicted that the trend would likely continue into 2006.

Join Jerusalem Post Premium Plus now for just $5 and upgrade your experience with an ads-free website and exclusive content. Click here>>

Related Content

The Teva Pharmaceutical Industries
April 30, 2015
Teva doubles down on Mylan, despite rejection

By GLOBES, NIV ELIS