Facility Guarantee Program
The Facility Guarantee Program (FGP) provides credit guarantees for infrastructure improvements in countries where demand for U.S. agricultural products may be limited by lack of adequate facilities.
The program is designed to boost sales of U.S. agricultural products in countries where demand may be limited due to inadequate storage, processing, handling, or distribution capabilities. The program provides credit guarantees to facilitate the financing of manufactured goods and U.S. services to improve or establish agriculture-related facilities in emerging markets.
Under the FGP, the Commodity Credit Corporation (CCC) reduces the financial risk to lenders by guaranteeing payments due from approved foreign financial institutions to U.S. sellers or financial institutions.
How to Apply
New to the Program? Start by submitting the Exporter Qualification Application.
Program Parameters
Participants are advised to note the following program parameters and limitations that are referenced in 7 CFR 1493 subpart C.
- Maximum Tenor: 10 years (Maximum tenor allowable will be determined on a case-by-case basis depending on the details of the transaction including, but not limited to, the destination country and the country of the foreign financial institution.)
- Initial Payment: For transactions with tenor of 24 months or longer, 15 percent of the net contract value. For transactions with tenor less than 24 months, no initial payment is required.
- Maximum Guarantee Coverage (Principal): For transactions with tenor of 24 months or longer, 100 percent (after deduction of the initial payment). For transactions with tenor of less than 24 months, 98 percent.
- Eligible Local Costs Percentage: Up to 50 percent
- Eligible Interest: The lesser of (1) the interest rate specified between the U.S. financial institution (or seller) and the foreign financial institution; or (2) 55 percent of the average investment rate of the most recent 52-week Treasury bill auction as announced by the U.S. Department of the Treasury prior to the date the eligible interest rate is established or adjusted. For a given contractual event, the interest rate used to calculate eligible interest will be established as of the date of performance and remain in effect through the first interest and/or principal due date. The Commodity Credit Corporation will adjust that rate as of each interest and/or principal due date. The adjusted rate shall take effect on the day after an interest and/or principal due date and remain in effect though the next interest and/or principal due date.
[Note: In the event of any discrepancy between this website and the payment guarantee, the language on the payment guarantee shall prevail.]