The Export-Import Bank may help finance U.S. exports of oil and gas equipment to Russia if Russian oil and gas production is provided as collateral, the bank's chairman said Wednesday.
John Macomber said he is "convinced there's a possibility of large-scale financing" for Russian oil and gas development. "I think this can happen if they (the newly formed Russian Oil and Gas Co.) accept some form of production payments as collateral for commercial bank guarantees.Ex-Im Bank would provide the guarantees to commercial banks extending credits to Russia.
Meanwhile, the bank has tentatively cleared relatively small credit guarantees for U.S. sales to Russia of nuclear power plant safety and control systems as well as equipment for making glass, batteries and construction panels. But all await payment guarantees from the Russian government.
Mr. Macomber told the World Affairs Council of Washington that Ex-Im Bank's lack of exposure in the Soviet Union is good because of "shaky conditions there."
The Soviet economy, he said, is "in a free fall," and basic questions, such as who has the authority to contract or who controls the foreign currency, cry out for an answer.
But, he also noted, Ex-Im Bank's limited Soviet activity is "bad because it puts American companies way behind their Western European counterparts in market share."
Under U.S. law, Ex-Im Bank's exposure in the former Soviet Union is limited to $300 million. The Bush administration has proposed lifting this ceiling, but Congress has not yet voted to do so.