USDA Announces Lebanon and Uzbekistan GSM-102 Programs
On December 29, the U.S. Department of Agriculture (USDA)
authorized $7 million in credit guarantees for sales of U.S. agricultural commodities to
Lebanon under the GSM-102 for fiscal year 1999.
On January 11, USDA authorized $20 million in credit
guarantees for sales of U.S. agricultural commodities to Uzbekistan under the GSM-102
program for fiscal year 1999.
Exporters may apply for credit guarantees for the Lebanon
and Uzbekistan GSM-102 programs, on a first-come, first-served basis to cover sales of any
of the commodities specified in the GSM list published in FAS announcement PR 0580-98,
issued November 6, 1998, or as superseded. The following horticultural products are
eligible under the export credit guarantee programs for FY 1999: dried fruit; fresh fruit;
100 percent fruit juices; fruit and vegetable concentrates, pastes, pulps and purees;
honey; hops or hops extract; tree nuts canned vegetables; dried vegetables; wine; and
brandy.
The GSM-102 program makes available financing for the
sales of U.S. agricultural commodities overseas. USDA does not provide financing, but
guarantees payments due from foreign banks. USDA typically guarantees 98 percent of the
principal and a portion of the interest. The GSM-102 program covers credit terms from 90
days to 3 years.
Under the program, once a firm sale exists, the qualified
U.S. exporter applies for a payment guarantee before the date of export. The U.S. exporter
pays a fee calculated on the dollar amount guaranteed, based on a schedule of rates
applicable to different lengths of credit periods. The CCC-approved foreign bank issues a
dollar-denominated, irrevocable letter of credit in favor of the U.S. exporter, ordinarily
advised or confirmed by the financial institution in the United States agreeing to extend
credit to the foreign bank. The U.S. exporter may negotiate an arrangement to be paid as
exports occur by assigning the U.S. financial institution the right to proceeds that may
become payable under the guarantee, and later presenting required documents to that
financial institution. Such documents normally include a copy of the export report.
If a foreign bank fails to make any payment as agreed, the
exporter or the assignee may file a claim with USDA for the amounts due and covered by the
guarantee. USDA will pay the U.S. bank and will take on the responsibility
of collecting the overdue amount from the foreign bank.
Table 1 presents the FY 1999
GSM-102 programs for which USDA has authorized credit guarantees for sales of U.S.
horticultural products as of January 20, 1999. Additional information about the GSM-102
program, regulations, country specific press releases and program announcements, and a
Monthly Summary of Export Credit Guarantee Program Activity may be accessed on the
Internet at:http://www.fas.usda.gov/excredits/exp-cred-guar.html
USDA Extends Supplier Credit Guarantees to Bulgaria
On January 11, USDA authorized $5 million in credit
guarantees for sales of U.S. agricultural commodities to Bulgaria under the Supplier
Credit Guarantee Program (SCGP) for fiscal year 1999.
Exporters may apply for credit guarantees for the Bulgaria
SCGP, on a first-come, first-served basis to cover sales of any of the commodities
specified in the list published in FAS announcement PR 0580-98, issued November 6, 1998,
or as superseded.
The SCGP is unique because it covers short-term financing
extended directly by U.S. exporters to foreign buyers and requires that the importers sign
a promissory note in case of default on the CCC-backed payment guarantee. The SCGP
emphasizes high-value and value-added products, but may include commodities or products
that also have been programmed under the GSM-102 program.
Table 2 presents the FY 1999 SCGPs
for which USDA has authorized credit guarantees for sales of U.S. horticultural products
as of January 20, 1999. Additional information about the SCGP, regulations, country
specific press releases and program announcements, and a Monthly Summary of Export Credit
Guarantee Program Activity may be accessed on the Internet at:
Note: The GSM will consider requests to establish a SCGP
and/or GSM Program for a country or region or amend an authorized program to include
horticultural commodities and products which are currently not eligible.
(For further information on the SCGP or GSM-102 Program
for horticultural commodities, contact Yvette Wedderburn Bomersheim, 202-720-0911).
California kiwifruit finds temporary market in New
Zealand
High domestic and international demand for New Zealand
kiwifruit has resulted in a shortage of domestically grown fruit, prompting imports of
California kiwifruit into the market. California exporters have shipped more than 350,000
lbs of kiwifruit to New Zealand since December 1998, compared to zero shipments in
1997/98. Exports to this market represent about ten percent of California's kiwifruit
offshore exports this season. According to the Agricultural Attache in Wellington, the New
Zealand market was depleted by strong demand in Australia and a larger than usual amount
of fruit being sold as stock food because it was not firm enough for storage. Also, some
producers have reportedly switched over to the Chinensis or Zespri Gold variety of
kiwifruit. New Zealand consumers are reportedly paying up to N.Z.$6.00/kg (U.S.$1.46/lb)
for imported California fruit, compared with the usual N.Z.$2.50/kg (U.S.$0.60/lb) for
domestic kiwifruit.
