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Export Finance and Insurance Corporation (EFIC) has assisted Teknis Electronics with its US export contract with National Railroad Passenger Corporation (Amtrak), the US government-owned passenger rail transportation operator.
EFIC’s assistance facilitated the issue of a performance bond in the US, the first such bond to be issued under EFIC’s new US$50mn bonding line facility announced earlier this year by the minister for trade, Mark Vaile. 
This facility was established in co-operation with Liberty Mutual Surety to assist Australian SME exporters take advantage of the opportunities afforded by the AUSFTA, especially those in the US government procurement market.
Teknis, a provider of engineering solutions to the rail industry based in Adelaide, won a contract with Amtrak for the provision and installation of two wheel condition monitors.  As part of the export contract, Amtrak required Teknis to provide a performance bond for 100% of the contract amount, valued at about US$500,000.
“The US market requires suppliers to post bonds by a licensed company in the state where the work is being performed, often for up to 100% of the contract value for performance obligations,” explains Angus Armour, managing director. 
“Australian SMEs are often confronted with the task of accessing bonding support from US sureties who have no experience with the Australian company and limited appetite to undertake contracts below a minimum size that would warrant developing a relationship.”
The new US$50mn bonding line facility with Liberty Mutual was designed to assist Australian SME exporters overcome these difficulties.  Australian SME exporters have the relative ease of dealing directly through EFIC, which uses its resources to underwrite the bonding required and to secure the issue of bonds through Liberty Mutual.  Liberty Mutual can issue bonds on EFIC’s behalf in all 50 states, District of Columbia and Puerto Rico.