Accelerating investments in energy efficiency and expansion of the renewables industry is a pure gain for the Polish economy and business as it improves its competitive position and strengthens country’s security. Being aware of the financing gap in the local market, we felt it necessary to include KUKE in supporting both companies and the financial sector in this process. Our guarantee program, pioneered among ECAs, will facilitate mobilization capital also from foreign markets. We are pleased that HSBC will join us to help Polish companies respond to the challenges of climate change and meet regulatory requirements.
Janusz Władyczak, CEO of KUKE
The framework agreement with KUKE covering the Green Guarantees program is an important step in supporting the net zero transition in Poland and mobilising financing options for green projects. We are pleased to officially access KUKE’s program and to utilise our global nexus and expertise in export finance to help our clients in their sustainability journeys.
Philip Lewis, Global Co-Head of Export Finance at HSBC
The Green Guarantees Program includes two solutions:
- guarantees of repayment for medium and long-term investment loans,
- payment guarantees, which can secure repayment of short-term working capital financing or repayment of obligations to suppliers in Poland and abroad, as well as to factoring companies.
The investments and projects to be covered with green guarantees include low-carbon power generation, hydrogen technology, production of equipment increasing energy efficiency, infrastructure supporting low-carbon transportation, modernization of water supply and treatment systems, transportation, and geological storage of CO₂. Importantly, the guarantees can cover, among other things, power plants using natural gas as a transition fuel.
The agreement stipulates the cooperation between the parties to provide financial instruments guaranteed by the State Treasury of Poland regarding to financing and contracts of Polish and Ukrainian companies with the Polish goods component, namely:
- Coverage of receivables (short-term financing of Polish export);
- Coverage of investments (long-term financing of greenfield and brownfield investments as well as M&A);
- Coverage of infrastructure construction projects (up to 10 years) of government and municipalities of Ukraine, as well as projects by private Ukrainian and foreign entities in which Polish companies participate.
KUKE was the first export credit agency (ECA) in the world to restore the coverage of ST export credit and investments in Ukraine after the Russian aggression in February 2022.
“The reconstruction of Ukraine continues here and now, and the country must function as normally as possible. Therefore, we should not wait until hostilities cease and then act. We at KUKE have adopted this strategy from the very beginning, creating various solutions and safeguards for emerging risks, incuding the war risk. While we have always believed that the role of blend finance will be enormous, we see that the creation of funds with multilateral support consumes a lot of time and hardly mobilizes significant capital so far. KUKE was the first and remains one of the few institutions that provide such guarantees to business. So far, over 3,000 Polish companies have declared their willingness to invest in Ukraine and participate in the reconstruction process. We hope that our cooperation with Oschadbank will increase their opportunities to participate in projects related to the reconstruction of infrastructure or other projects aimed at modernizing the economy. Partnership with local entities may strengthen their position to compete effectively with firms from other countries and give them access to a market with extensive needs”.
Janusz Władyczak, CEO and president of KUKE
"Oschadbank continues to form an international coalition to support Ukrainian business. The memorandum signed today stipulates that our Polish partners from KUKE will soon join us in guaranteeing investments in the Ukrainian economy. We already have several projects to guarantee financial obligations together with the EBRD, the European Investment Bank, and the Ukrainian Export Credit Agency. The involvement of a powerful Polish player in the field of export guarantees in these programs will increase the volume of such initiatives and help attract foreign investment for much larger projects that the Ukrainian economy needs today. We are very grateful to our Polish friends for their cooperation and willingness to help build Ukraine even during the full-scale aggression."
Sergii Naumov, president of the Management Board of Oschadbank
The agreement also enables cooperation between KUKE and Oschadbank in other areas that both parties consider mutually beneficial.
"TXF conferences provide the trade & export finance markets with unique events that gather representatives of companies from around the world, such as financing institutions, i.e. banks and insurers, including export credit agencies such as KUKE, as well as general contractors, regulators and decision makers. The topics of these meetings cover current market situations, legal changes, issues of sustainable growth, but above all, they are focused on networking and transactions. Each of them gives the opportunity to take a new look at business, suggests interesting ideas for change, and also provides contacts that often result in transactions in which KUKE participates, trying to find opportunities for Polish entrepreneurs"
Janusz Władyczak, CEO, KUKE
The other two events that KUKE will partner with are the TXF Asia conferences in Singapore and the TXF Africa conferences in Cape Town, South Africa, scheduled for the second half of 2023. Apart from KUKE, representatives of export credit agencies, including from Denmark, Switzerland, Germany, France, Australia, as well as banks with which KUKE cooperates on international markets, e.g. Santander Corporate & Investment Banking, Standard Chartered and ING.
"TXF is delighted to be partnering with KUKE for the first time on these industry-leading events in Lisbon, Singapore and Cape Town. We are looking forward to partnering with them to bring together the key decision-makers in the export finance market, from borrowers and exporters, to commercial banks and other ECAs and DFIs from across the globe. This year's TXF Global event in Lisbon is set to be the biggest to date, and also the most senior with more ECA CEOs than ever before, including the participation of KUKE President, Janusz Władyczak."
Eavie Burnett, TXFs Head of Event Content
Recently, KUKE insured financing from the Standard Chartered worth USD 73 million, which will be allocated to the expansion of the Namibe University in Angola, and this project will be carried out by the Polish companies Quenda Group and Torhamer. At KUKE, we are analyzing the possibility of engaging in further projects in African countries with the participation of Polish entrepreneurs.
Polish exporters that proved to be outstandingly resistant to the unprecedented market turmoil caused by the Covid-19 pandemic will be given new solutions that will allow them to ensure even more effective foreign expansion. The instruments from this year’s exporter support system implemented by KUKE will be offered by Santander Bank Polska ─ one of the leaders in financing international trade ─ to its clients. The cooperation agreement was signed by KUKE’s President and CEO Janusz Władyczak and Juan de Porras Aguirre, Vice President of the Management Board of Santander Bank Polska.
“Export finance and the expansion of Polish companies on foreign markets remains one of the key priorities for Santander Bank Polska. Exporters are dynamic and creative businesses that are growth-oriented and do not shy away from challenges. The experiences of the pandemic have simply confirmed that banks should commit to a much broader cooperation with them and actively support their expansion. We are delighted that KUKE, with which we have already been working for years on various transactions, will be a partner in these ventures on a much wider scale. The solutions offered by KUKE this year deliver a whole new quality of support to exporters, opening up the opportunity for Poland’s much greater presence on the global market. It is also a chance to stimulate export-oriented domestic investments and convince even more companies to boldly venture out into foreign markets with their products and services. The first customers should soon be able to take advantage of the newest solutions jointly offered by us. We see great possibilities of harnessing KUKE guarantees for working and investment capital financing needs, thanks to which companies will be able to obtain greater credit limits,” Juan de Porras Aguirre, Vice President of the Management Board of Santander Bank Polska said.
The new instruments which are guaranteed by the Polish State Treasury reduce the bank credit risk related to financing export activities. Thanks to this, banks focused on speedy development will be able to lend more money to their clients for their working capital, investment and guarantee needs while maintaining the same level of risk, while others will be able to limit the risk, which will be assumed by KUKE.
“KUKE’s mission is acting in favour of Polish entrepreneurs and, above all, supporting exporters. We have been effectively doing so during the pandemic when, under such difficult conditions and uncertain outlook, Poland still managed to increase its share in global trade. Although a market upturn has begun, this does not mean that exporters will find it much easier to operate because many countries are eager to recover from the pandemic recession. We are, nevertheless, convinced that the new instruments introduced by KUKE this year will significantly enhance the competitive position of Polish exporters. This requires cooperation on the part of banks who support and finance domestic entrepreneurs. We are delighted to have signed the agreement with Santander Bank Polska, which remains one of the most active players in supporting domestic exporters. The new set of solutions encourages banks to provide more extensive financing not only of trade contracts but also of investments and acquisitions undertaken by their clients. We are offering exporters instruments that are provided by only a few other countries in Europe,” Janusz Władyczak, KUKE's President and CEO explained.
The agreement signed between KUKE and Santander Bank Polska will contribute to promoting the new system of export support among the bank’s clients. Furthermore, the parties will also be able to cooperate in other fields, like information campaigns on the advantages of trade finance.
Within the export support system, KUKE has introduced new instruments and thoroughly modified the existing product offering provided with the support of the State Treasury. Working capital guarantees, guarantees for the repayment of liabilities towards suppliers, and supply chain financing guarantees are among the new guarantees that will help exporters obtain additional funds from banks and factoring companies. As for contract guarantees, the procedures and documentary requirements have been simplified, and the scope of goods and services that they cover and their applicability have been extended. Thanks to the new insurance of bank loans for financing direct investments abroad, Polish firms will be able to expand and take over competitors more easily. One of the key solutions in the new palette are guarantees for financing investment projects in Poland for exporters ─ covering both Polish and foreign investors developing production in our country.
Use of these instruments strengthens the exporter’s financial capabilities, positively influencing its relations with financing banks, and allows it to significantly scale up its operations. KUKE is working with the CMS law firm in the scope of creating the client documentation.