African export financiers discuss the opportunities for banks and export credit agencies going forward, and find that infrastructure is set to dominate the continent’s financing requirements.


Roundtable participants

  • Karin Apelman, director general, EKN
  • Gabriel Buck, managing director, head of ECA and capex financing solutions group, Barclays
  • Yusuf Ali Khan, head of trade, Africa, Citi
  • Mandisi Nkuhlu, chief operating officer, Export Credit Insurance Corporation of South Africa (ECIC)
  • Philna Potgieter, head: Africa and export credit finance, Nedbank Capital
  • Alexei Rybakov, director, export finance, Sub-Saharan Africa, HSBC
  • Simon Sayer, head of structured trade and export finance, Deutsche Bank
  • Agnes Tauty, managing director, director – head of structured export finance – trade, Europe and Africa, Société Générale
  • Benjamin Todd, officer, global business development, Export-Import Bank of the United States (US Exim)


Khan: Over the last day, at GTR’s Africa Trade Finance Week, we have been talking about different aspects of export credit agency (ECA) financing. We have heard the views of major commercial and national banks both inside and outside Africa. We have also heard the views of the ECAs, from an African ECA, a European ECA and a US ECA perspective.

For the most part, the story and the messages that we have heard over the last day have been around infrastructure growth; the spend Africa is seeing in the infrastructure space. There have been discussions around commodity flows and the relationship between Africa and the BRIC countries, specifically China and India; it is very transactional and extractive. Is this really the case going forward? Where do the banks and the ECAs see the opportunities developing over the next three to five years?

Sayer: My view on this – confirmed, I think, by what we have heard over the last couple of days – is that the requirements for Africa can be summed up in three words: infrastructure, infrastructure, infrastructure. I firmly believe that it will continue to be a story about infrastructure. Above all, Africa must establish itself and continue on its growth trajectory. Our business is essentially infrastructure financing – so naturally we will continue to operate in African infrastructure.

Your question invites another, which is: ‘Will there be other sectors that come to the fore?’ There will be – but in my opinion the crushing weight of infrastructure demand will dominate finance requirements for Africa for the foreseeable future.

The other part of the question concerns the extractive industry – and that has grown. Interestingly, the way that the extraction industry uses export finance is a little different to other sectors. Much of it is in the hands of private enterprises, which have access to alternative funding, unlike state-owned enterprises or governments, for example. I’ve observed plenty of available finance – on a cash basis – when times are good, like in the oil and gas industry. If export finance is particularly attractive then the large mining companies will use it, but if it isn’t then they don’t need to and won’t. They are a generally a more transient client, and I see no reason why that would be any different in Africa.

Apelman: I agree with Simon’s starting point that it is a lot about infrastructure. For us at EKN, infrastructure is also telecom. Infrastructure is also the transport sector with a need for construction equipment, so from the Swedish exporting side it is equipment sales into building infrastructure. This also applies in the mining sector where we see big players in the transport sector as well as in the mining sector.

In most of these cases we see private instead of public buyers. We work with all the international banks to finance these transactions because when we guarantee the payments, the banks are willing to finance. We get involved very early in the planning; we understand the needs of the Swedish exporters. We talk to them very early to structure the transactions together.


Khan: Gabriel, Barclays is very active in Ghana across the infrastructure space; also in South Africa. Perhaps you could share some of your views. Is the public sector really going to lead the way, or is this going to be a PPP-type approach?

Buck: I agree with everything that Simon has said, and add two comments. Firstly on infrastructure most, for the foreseeable future, will be sovereign or quasi sovereign-related rather than PF private sector financing.

The other point I would add, on Simon’s point regarding the extractive story, is that the extractive sector will be co-linked with infrastructure. Across Africa extractive projects with close access to market or port have already been undertaken. The big story going forward are those projects where infrastructure is going to be a key component in getting the minerals to market. I do not believe that the mining houses will wish to take the infra link on their own balance sheet. Thus, third-party players will need to be brought in and they will require financing. Thus the mine and the infra will be linked.

Tauty: There is a huge bottleneck in terms of infrastructure for the majority of African countries. The solutions and challenges vary from one sector to another from an economic standpoint. Certain sectors need financial support from the sovereigns when it comes to health, water and roads. Multilaterals and ECAs will have an important role to play. We can foresee a PPP for projects where the economics are strong enough to make it bankable. It is also mandatory to have an adequate legal environment to provide the necessary securities for investors and creditors. The first PPPs are likely to be set up with the strong assistance of multilaterals to assist in the definition of the legal framework and provide the necessary institutional capabilities as it was the case for certain countries in Eastern Europe.


Khan: If I move this further, infrastructure by definition means there is a substantial amount of commitment required from a liquidity perspective. From a tenor perspective, by definition, these projects are going to be beyond the norm of 10 or 12 years, going up to 18 years in the case of railway builds for renewable energy.

Mandisi, ECIC worked on a project in the infrastructure space in 2012 where it was able to work with both Citi and Barclays to structure a deal in the power sector. How are you seeing the requests coming through from the different banks, and how are you seeing the tension play out between the tenor requirements and the cap loss by Citi?

Nkuhlu: You are right, the value add that the ECA brings is to help the banks to extend the tenors for much longer than they would if the ECA was not there. They also bring some level of risk mitigation for these long-term projects. You raise an interesting point about the tenor, whether under the current arrangement with Citi the OECD requirements would be restrictive, whether it is in the rail or other sectors. There is now an open discussion taking place that involves the OECD ECAs and the non-OECD ECAs called the International Working Group, which is revisiting some of the assumptions in terms of what is already contained in the arrangement.

Obviously it has got to enable the infrastructure development to take place, especially on the African continent. There might be a need to allow for long tenors in relevant sectors. Even where there may be additional tenor capacity from an ECA, from a banking perspective there is still a challenge to follow those tenors, so the banking appetite for long tenors will still remain a constraint in one way or another. The structuring has to be sensitive to what the banks can do because most of the ECAs are not financing directly, and work closely with the banks.


Khan: How is US Exim addressing some of the infrastructure needs by direct funding, and has there been any new experience in the recent past?

Todd: I agree with everyone here that infrastructure is the future play in Africa. Tying back to the first question before I go into the second, what I find interesting about the infrastructure opportunities in Africa is that previously infrastructure was always tied to the extraction, and now it is kind of decoupling from that.

I think that is part of the story of the rise of the African middle class. No longer is it only: ‘We need a railway to take mineral x to the port.’ The narrative is increasingly including: ‘How do we bring goods coming into the port to the vibrant markets developing within the country?’

At US Exim, our experience in infrastructure has been that most of our direct lending is a response to the financial crisis. Where we have seen our direct lending accessed most is in longer-tenor transactions. For example, in India we did a number of transactions in the solar energy space, which were 18-year tenors. These were all direct loans as banks had no appetite to lend against a US government guarantee for 18 years.

In Africa we do see banks willing to lend against our guarantee for medium and long-term tenors – in local currency as well. For example, we have approved guarantees in South African rand and we have used capital markets transactions supporting aircraft exports on the continent as well. When you start looking at the longer tenors, for example in renewable energy, I think there will largely still be direct lending, but we are always open to look at other options.


Khan: From an EKN perspective, SEK has been utilised as a popular funding vehicle, perhaps we could invite some comments from EKN’s side.

Apelman: The Swedish system for deals financed with buyer’s credits works as follows: a commercial bank arranges the buyer’s credit. EKN guarantees the repayment. The bank can get funding by assigning the loan and the EKN guarantee to SEK, a Swedish state-owned corporation which provides liquidity for Swedish exporting companies. The commercial bank is of course free to use its own liquidity and only apply for the guarantee from EKN for the risk of non-payment. But we see that funding is important in many transactions, and we are happy that Swedish exporting companies and their customers worldwide can benefit from a very strong and attractive offering.

Buck: Earlier today you had David Humphrey, who is the global head of power and infrastructure at Standard Bank, make what I thought was a very telling comment about when you are looking at PPP and PFI for infrastructure. He said that, and I am paraphrasing here, you have to sort the politics out first. If not then the project is doomed to fail, and it reverts to a sovereign transaction. When we are talking about infrastructure, whether it is on road or rail – and I am thinking now of Sanral – politics was ostensibly sorted out in terms of the tolling. Debt was raised on the back of the tolling, but the politics end just became complicated. The tolling agreement and the ability to implement that got delayed significantly, and that is here in South Africa. So if we look at infrastructure on a non-sovereign basis; that is going to be the biggest challenge.

The second point, which I think is important when looking at the private sector, whether infrastructure is for road or rail; they are massive. Therefore it is not just about the debt, it is: where are you going to get the equity? These are not going to be 100% levered with the ECAs, so it is about where you are going to get the equity for a project that may have a payback over a long period of time. I think that is the challenge.

Potgieter: I just think that if you look at the infrastructure requirements, although it is very easy and nice for us to just do a government loan, get a government guarantee and ECA cover, it is not sustainable. I certainly think that finding another model, such as a PPP, would not be a bad idea.

In addition to that, one of the biggest challenges in Africa is the delivery of a project. The capacity of governments to actually deliver projects and get them to let us call it an executable stage, and there again, something like a PPP model could really get projects or get infrastructure to actually happen as opposed to just be a requirement, and a huge requirement as such. If you look at Kenya’s PPP model in the energy space, it has been very successful and has actually brought projects to the market and they have all been financed on that basis. Equity is being found for it, so I certainly think that although it is nice to just get a government guarantee, it is in short supply and it is going to continue. Governments can never borrow to the extent that the infrastructure requires.

Buck: No, but today we heard the average wage is Africa is US$1.5 a day. Here in South Africa, people are concerned about the increased tariff that they will have to pay for energy and for transport. Unless PFI can create an economic benefit with prices that are kept low, I question how these projects remain be affordable.

I fully agree with you in terms that one cannot have a sovereign guarantee for every project. To do so will create another Sovereign African debt crisis. No one wants to get back into that cycle. It is a very delicate balance; on the one hand we all want to support infrastructure development. On the other we need to find a way of getting these projects affordable.

Rybakov: There are sectors where private sector involvement is more significant than it used to be in the past. For example, before, most of the power projects we were involved in would have been financed with the support of the government. These days, you can see in a number of countries the development of the IPP structure. We have already been involved in IPPs in Ghana and Mozambique, and other countries in the region, such as Kenya, Nigeria and a number of others, have also developed IPP schemes. It just highlights that it is possible to unlock additional liquidity coming from the private sector on the private sector balance sheet for critical infrastructure such as power generation.

Also, it was quite interesting in today’s panel discussion about the power sector that the answer to what is the biggest challenge to the development of the sector was not actually the availability of finance, but it was to do with the regulatory framework. Once this is addressed, it then unlocks the liquidity for the DFIs, the ECAs, and commercial banks.

Buck: There is one thing I find really interesting in terms of ECAs, which is how they are now starting, particularly out in Asia, to provide support for equity. Is that something you are looking at?

Apelman: We have not been asked to support equity.


Khan: The likes of DEG and FMO all provide equity. Tier I and Tier II capital is something that they do. Citi has been able to use these structures in tandem with the debt financing component.

You know that Sace had a national interest programme where if an Italian investor was making an investment or forming a JV, then the project of company would qualify for Sace-supported financing even without the flow of capital goods.

Todd: From US Exim’s standpoint, our mandate is clear: to support US exports. But as far as on the equity side of the fence we work closely with OPIC, and they are the FDI arm of the US government.

Nkuhlu: We do have a lot of capacity for equity support, but only provide PRI support for those equity investments. It is something we really want to promote more. You are right, obviously for big transactions there is a gap in equity, and somebody needs to facilitate that.

I do think though that for infrastructure projects the role of government is still very key. You were right to raise the question of affordability, whether it is an IPP, because government still has to give backstop support or some top-up arrangement. It is a question of deal selection, which projects get priority treatment by government? Which projects have greater economic benefit to that economy? I think the Ghana example shows that deal selection becomes quite important.

As regards the extractive industries, there is still room for private sector-linked projects. Export funding is relevant to support those transactions. We are seeing a lot; in our portfolio right now close to 50% is in mining. We see more enquiries coming through because of the risk issues associated with some of the jurisdictions, so there is still a need for ECA support for those extractive projects.


Khan: Let’s move the discussion on. Are you seeing new players coming in, players who traditionally would not have been there? I am not just talking about banks, but are you seeing other institutions that are looking to play in this space?

Sayer: The short answer is yes. Africa is undeniably booming, and a boom situation brings in all sorts of new banks and new investors. There is an article in Cape Today opining that Eurobonds are the new must-have for any emerging African nation. That is a slightly flippant comment – but there is some truth in it. In the last three years there has been an impressive amount of Eurobond activity out of Africa, starting in Ghana and followed by a number of subsequent issues – in Zambia and Gabon for example. Kenya is now entering the market as well. All of that is helping the investor market.

As far as new banks, the answer is also simple. The model nowadays is for banks to follow their clients. Again, a booming market means that our clients want to do business in Africa – regardless of whether we are present or not – so we will follow our clients there. In Deutsche Bank’s case, we are currently in South Africa and Lagos, but we have no footprint between those two countries. We are supporting our clients in at least 12 countries that we weren’t a decade ago, and might not have been otherwise. There are lots of new players, which is exactly what Africa needs. Nonetheless, Africa must recognise that money has a choice – there are plenty of different geographies and regions that it can go to. The great thing that has come out of the last few years is that that choice has been made in favour of Africa. To put it simply, people want to come here because clients are doing business here.


Khan: There has been a proliferation of Chinese money across Africa. Chinese policy banks like China Exim and China Development Bank have come in and have really opened up the purse strings with tenors that would be non-achievable by commercial banks for deals especially in the sovereign space. What are your thoughts and sentiments?

Buck: My sense is that the Chinese influence is not as dramatic in terms of the way it has been portrayed. It is in certain countries but not others. I’ll give you an example; three years ago Barclays closed the Telkom Sinosure transaction here in South Africa. To our surprise it was the first Sinosure facility in the country. We didn’t know at the time; we just thought it was one of many given all of the talk that has been going on.

It is clear that China does have an interest in Africa, and Africa has an interest in China. The world economies are changing and shifting.

The issue is one more about OECD versus non-OECD, and the interpretation that Sinosure and the Chinese will have. My own experience is that Sinosure are more conservative than other export credit agencies and that they tend to be very focused, and comfortable, with sovereign-related transactions. Move one step, possibly two steps away from a sovereign deal and that is a challenge for them. We are doing a PF deal in Africa with Sinosure support for what is a mine-to-mouth power station where the debt repayments are not guaranteed by the sovereign. Sinosure have advised that this will be their first PF transaction of this type in Africa. It’s been a long haul requiring heavy lifting from Barclays but at the end of the day we see a very successful transaction and another market first.

The Chinese African market is where we see real future growth. So much so that two-thirds of my analysts are Mandarin speakers. Based on our own experience, the Chinese market has not drowned out the rest of the market but they certainly are an important and growing part. Terms are attractive both in terms of tenor and sometimes the pricing of their premium.

Apelman: We come across Sinosure in the Berne Union. They are very interested in understanding how other members operate. I have been elected to be the chairman of the medium/long-term committee, and the vice-chairman is Jing Fenglei from Sinosure. So we are partnering on that subject, and we are preparing the agenda now for the meeting in May.

Rybakov: It is a very interesting perspective for how it has developed over time. Previously a lot of funding that came from the Chinese government institutions, like China Development Bank and China Exim was on a concessional basis and was tied to offtake from some extractive industries – support arrangements in the form of oil contracts or other natural resources. What we now see is this emerging trend of Sinosure coming in to specifically support exports without any other strings attached. We have seen Sinosure increasing their activity in Africa quite substantially and have been involved in transactions in Nigeria and Kenya, and are now following a number of further such opportunities in the region. So it is interesting to see how it has gone from a state-led approach to something that is more in line with the OECD ECAs, and just supporting exports of capital equipment into the region.

Todd: There are two points related to this. First, it seems that folks tend to see Africa as a static environment, fixed pie, which it is not. We are looking at economic and population growth rates that are pretty astounding. So by all means there is a lot of room for everybody.

Secondly, as it relates to China, I think they have done some good things on the continent as far as providing some basic infrastructure; more paved rural roads, for example. What we have seen with Chinese financing has been commercial in nature. Yes, they do concessional financing, but largely what they do is commercial in nature, some of it within OECD terms, some of it not.

We have made it clear to US exporters that if they believe that they are being shut out of opportunities because of financing, we do have the ability to match it. We can consider doing that; it is within our charter.


Khan: I guess the next burning topic is local currency and ECA finance. Clearly, there are banks round this table that have had experience with that?

Potgieter: Last year we worked with Barclays and US Exim and managed to provide Transnet with two sizeable loans to support GE exports to Transnet against US Exim guarantees. Transnet is a very important client to us, and we have quite a lot of exposure to them already. It enabled us to actually open up lines for them, provide them with finance here but have another balance sheet to look at. From that perspective, and for Transnet, it was very useful.

It gave Transnet what they required in terms of local currency finance. Certainly, from their perspective it was very useful that US Exim was prepared to provide cover for local currency.

It is something that would be great to be able to provide in more jurisdictions, but it will remain challenging. In South Africa we have done local currency financing with Hermes as well, so that now it is almost as accepted and established, as well as with Sace. It is certainly established and well-supported by most foreign ECAs. We have to be doing more because it provides the South African borrowers with what they require; tenor as well as the guarantee that they want, and then another balance sheet to look towards.
Buck: I agree with you on that. Infrastructure, by definition, is a local currency earner. Therefore, having your assets and liabilities matched is inherently beneficial from a sustainability perspective. Look at what is happening in Ghana – the Government is wishing to encourage local currency financing to alleviate currency mismatch risk.

When we were putting together the Transnet transaction, ECA financing in rand was key for the borrower. The issue was how to overcome crystallisation clause and still get a premium reduction. Crystallisation can, by certain accountancy standards, be classified as an embedded derivative and therefore flagged in the report and accounts. Not great with many borrowers. The second is the 35% premium reduction – which has subsequently been reduced to 25% – is only available with a crystallisation clause. Eventually with significant structuring a solution was found. Some agencies were quick to accept a structure – others took longer.

My point is that in rand we’ve been able to replicate this for many other state-owned enterprises in South Africa. Outside of South Africa in the rest of Africa there is a much bigger market to be undertaken and we are keen to explore this.

Sayer: However, there is potentially a conflict here. While local currency financing is very attractive and has clear merits for borrowers, there is also question of scale. We all agree that the infrastructure requirement in Africa is enormous, and that all possible sources of finance will have to be tapped. The fact is that outside of South Africa there is not enough depth of liquidity to provide the sort of figures that are required to get Africa moving. Even Nigeria, with naira, currently lacks the kind of bank lending or capital market availability to meet the existing requirement. But if you need to access all forms of liquidity, the conflict comes from most of those forms being in hard currency – usually dollars. 80% of world trade is in dollars, and therefore we can assume that around 80% of what will happen in Africa will be funded in dollars too – that is the deepest pool. I think that local currency is an important product to offer, but it isn’t necessarily a game-changer at this stage.

Buck: I fully agree with you. Why I am quite passionate about this, although I do not have all the solutions; we all agree the need for infrastructure is large, but if it is all undertaken in dollars, then we have got an Africa debt crisis on our hands. Long-dated, hard currency debt for local currency revenue generating projects makes us all losers at the end of the day. Something we need to avoid. We need to find a balance.


Khan: In terms of market depth and in terms of the sizes, from Citi’s experience, we have had a risk sharing framework with OPIC basically where we have been able to provide US$25/30-equivalent of local currency financing to corporates in the private sector. This has been specifically geared towards the development of the local bank market. The good thing about this programme is that it could be supplies coming from Ericson, and necessarily we do not need to use EKN because it can be executed in a shorter timeframe because it is sort of a cookie-cutter approach that we are using for some of these buyers.

Outside the public sector space there is a place for ECA financing for multilateral support financing in the private sector space as well. The other important thing would be that whereas Gabby, your point in terms of loading on dollar debt is not prudent, whether you are talking corporate or sovereign, certainly the receivables are in local currency. The balance sheet for these sovereigns will not remain static.

Rybakov: I just have one point to add on the local currency financing versus foreign hard currency. What we have noticed is that sometimes the interest rate differential between the hard currency finance and local currency finance is so substantial that it is precisely the hard currency nature of ECA financing that attracts the borrowers. Yes, of course there is the foreign exchange risk inherent in that structure, but to the extent that the borrower is comfortable with this and can mitigate it to a certain extent, sometimes it is the hard currency nature of what we do that makes this financing attractive and improves the rate of return for the borrowers.

Buck: True, but there is a correlation between FX and interest rates.

Rybakov: But it is also about taking the view on future FX rates, given the tenor of the financing.

Sayer: Our earlier panel pointed out that a lot of the countries able to spend on infrastructure at the moment have hydrocarbon resources or mineral resources, which are dollar-denominated and provide a hedge. So they are not actually as exposed as one might assume.


Khan: From an Africa-based ECA perspective, what have been your experiences? What are your drivers for transactions and are they really different from the drivers that perhaps EKN or the US Exim will have?

Nkuhlu: In our case, Africa is our market. From a strategic perspective it is important that South Africa is an important player. Obviously in terms of our mandate we facilitate SA exports, but with a perspective for economic development for the rest of the continent because most of the countries in the region then become trading partners for South Africa. So there is a holistic view in terms of regional growth. So those are the broad developmental objectives, but obviously at a transactional level it is responsible lending, making sure that we do not overburden sovereigns with debt. So we have to give them affordable debt whether it is the interest rate or long tenors.

The nature of the transactions that we support need to be in the productive sectors of the economy, not just projects which are in the whims of the sitting government at that point in time. There must be longevity and strong developmental impact of those projects. Obviously we play to the strength of our exporters and investors, and we follow them in different markets. In that regard I am sure we share the same approaches with other ECAs in other parts of the world, whether you are talking environmental or developmental issues, so the approach is similar in that sense.


Khan: We are fortunate to have done a few ECIC deals, and if I was to look at the processes and engagement, it has been an extremely positive experience from our side because there has been that level of interaction. The flexibility that ECIC has shown, specifically when it comes to addressing the points that you are raising when you talk about responsible lending, working within the concessionality, non-concessionality boundaries that most Sub-Saharan African sovereigns have, especially the ones that have not more than one month’s import cover in terms of foreign exchanges.

Buck: I use ECIC’s business model as an example to other export credit agencies, particularly in the UK, as to how to do things right, simply and productively, particularly in the way that it is supporting SMEs. The ECIC model for communicating between SMEs and banks works very well, as does the interest make-up agreement.


Khan: Vanilla versus the bespoke, be it for exporters or importers: what are the solutions? Are you being asked to look more at bespoke solutions or is it pretty much a business as usual kind of approach?

Tauty: In Sub-Saharan Africa, we mainly work with sovereigns and SOEs. There is some project finance in oil and gas with ECA cover and we expect an increase in the years to come. But as of today, sovereigns and SOEs create the bulk of ECA financing.

Rybakov: I would agree with that. There is a certain difference in the types of borrowers that you deal with. When it comes to the government sector, and the majority of ECA transactions in the region have been with governments, the key is to make it simple and cheap. So that is a very simple paradigm, but ultimately that is what is necessary in order to ensure that the financing sails through the government approvals system. When we are talking about private sector borrowers, particularly if it is project financing, then you cannot get away from a more complex solution. Every transaction is bespoke by its very nature. We have to cover the entire spectrum, but it really depends on the nature of their counterparty.

Sayer: The solutions we provide are as complex as necessary, but as simple as possible. That is the best approach. In fact, we often use framework agreements with governments, because ministries of finance and state-owned entities do not have large legal departments able to process 60-page documents for every new deal. What works better is to draw up an agreement once, and then have an additional five-pages reflecting the terms under a framework agreement. Framework agreements are very helpful, and at the private end more complex, particularly for PF.


Khan: Changing tack: in terms of corporate social responsibility, is this a necessary function?

Apelman: EKN has for many years been developing how we work with and take responsibility for environmental and social issues. Our experience shows that there is a strong connection between CSR problems and financial risk. Inadequate management of these issues can cause disruption in the production, for example as a result of government intervention, riots or other types of unrest. In addition to assessing environmental and social issues in the transactions we also include anti-corruption measures and sustainable lending to poor and indebted countries in our CSR policy. The work is done in close co-operation with exporters and banks.

Tauty: It is also important for us. We carefully select projects that contribute to a country’s development. We need to look towards the future and be responsible for our actions. As an Equator Principle member, we have to take into account all environmental and social (E&S) aspects. It is a long process that requires strong expertise and knowledge to advise and support our clients. Société Générale has experience in managing complex projects involving E&S requirements. For some projects, ECA and multilateral involvement is a key criteria for us as joint efforts allow us to issue E&S due diligence and monitoring.

CSR has become much more important. If you look back 20 years in the ECA business it was very opaque. Most borrowers did not know what was going on; ECA was a take it or leave it proposition. In the last 10 or so years banks are doing their bit as well. We are spending a lot more time and effort in training, technology transfer, greater localisation and importantly transparency. Good corporate governance is important both in terms of the way that the business is done, and in assessing affordability. I see this change particularly so at a government and an SOE level. This is good change. It is a necessary function both from a moral and business perspective.