Ukrainian SME gets international support

Ukrainian SME gets international support

Ukrainian Confectionery company ZhL has won a five-year buyer’s credit export finance deal from Rabobank.

IBcontacts, a firm specialising in international trade development between Ukrainian companies and their foreign partners, helped to coordinate the transaction and provided legal advice, while Dutch state export credit agency Atradius provided insurance.

IBcontacts was unable to disclose details of the size of the loan when approached by GTR.

However, the company confirmed that the current challenging economic and political environment in the Ukraine makes it difficult for small Ukrainian companies to attract direct export financing from international banks. Before this deal, a direct buyer’s credit scheme was only accessible for bigger industries and country leaders with high turnovers.

Interanational funding also proves to be advantageous for Ukrainian companies as loan rates can be significantly lower than the ones of Ukrainian banks.

“There is no need in the pledge and terms are more acceptable for the borrowers from Ukraine. The realisation of such investment projects is strategically important for the national companies as it helps to increase production capacities of the company and its competitiveness in the long-term prospects,” says managing director of IBcontacts Kateryna Barabash.

IBcontacts’s head of legal department, Oleg Dorofeev adds: “On this stage we faced many challenging aspects, including the consideration of all legislative intents regarding credit agreements conducted between the Ukrainian residents and their foreign partners and its registration in the National Bank.

But this experience helped us to develop an efficient mechanism for the conclusion of such agreements. It will allow us to close similar deals for Ukrainian companies in a shorter period of time.”