The project and export finance division of HSBC Bank and Czech Export Bank have signed a US$45mn facility to provide kodaexport with the guarantees required in relation to their engineering, procurement and construction (EPC) contract for a 225MW independent power generation project developed by Orient Power in Pakistan.
The transaction was supported by the Export Guarantee and Insurance Corporation (Egap), the official export credit agency (ECA) of the Czech Republic.
HSBC’s project and export finance division, a world leader in structuring and arranging ECA-supported facilities, has identified Pakistan as a key market for future growth in this business. HSBC expects ECAs to play a significant role in financing Pakistan’s capital expenditure requirements over the next decade, primarily in the energy sector.
On the occasion of this facility execution, Muhammad Tahir Sadiq, HSBC Pakistan CEO, says “We are very pleased to have supported Pakistan’s first IPP to reach financial close under the 2002 power policy, a reflection of HSBC’s strength in project and export finance. Going forward, HSBC sees strong potential for this business in Pakistan and is committed to playing an active role in the country, consistent with its global expertise.”
While this facility is the first major Egap-supported transaction in Pakistan, it is anticipated that several other similar transactions will be executed in the coming months reflecting kodaexport’s success in securing contracts in the country.