UK Export Finance (UKEF) has guaranteed an £89mn loan from JP Morgan to support Brazilian aerospace manufacturer Embraer.

The deal will enable Embraer to “access critical parts, components and technology from UK suppliers” for its commercial and defence aircraft programmes, and strengthen links between UK suppliers and Brazilian manufacturers, UKEF says.

JP Morgan was the lending bank and arranger for the deal, which closed in October this year. UKEF is covering 100% of the loan value through its buyer credit facility.

“With this UKEF first deal with Embraer, we can export world renowned British expertise and technology in the aviation and aerospace industry to Brazil – an economy that was rapid in recovering pre-pandemic levels of economic activity, that keeps on growing strong in 2022 and is an important trading partner to the UK,” says Samir Parkash, UKEF interim chief executive.

“In fact, in the four quarters up to Q1 2022 trade in goods and services between the two nations increased by 18% year-over-year reaching £6.5bn,” he adds.

Embraer chief financial officer Antonio Carlos Garcia says that the deal “shows the success of our strategy to diversify our suppliers and financial partners. We are always looking for actions that improve the profile of our debt, and this operation is another step in that direction.”

“The financing structure is flexible and innovative, and it would not have been possible without the commitment of all parties involved in rolling out this milestone programme,” adds John Meakin, global head of export and agency finance at JP Morgan.

According to UKEF, the organisation has over £3bn available to help Brazilian buyers access finance to trade with the UK, with the ability to provide guarantees in Brazilian Reals.

Earlier this year, UKEF backed a €2.4bn loan from a group of commercial banks for a high speed electric railway project in Turkey, and agreed a £500mn loan guarantee for automotive manufacturer Jaguar Land Rover in December 2021.