By Daniel Hunter
UK Export Finance (UKEF) has signed a Memorandum of Understanding (MOU) with the Russian-based bank, Alfa Bank, to help British firms looking to export to Russia.
The MOU was signed during the two-day trade visit to Russia led by Business Secretary Vince Cable, and comes as the Government launches its 'Exporting is GREAT' campaign.
The MOU sets out UKEF's and Alfa Bank's intention to establish a $50 million facility which will provide financing for UK export contracts, and is particularly geared towards exports to Russia by small and medium-sized enterprises (SMEs) in Britain.
The proposed facility is set to be the first under the umbrella of UKEF's Direct Lending Scheme. It will enable UKEF to provide funding to Alfa Bank, for them to make medium-term loans to Russian businesses buying goods and services from UK exporters. The $50 million facility will be available for export contracts over £1 million.
Trade Minister Lord Green said: "Our exports to Russia have nearly tripled since 2002 and it is set to be the largest market for UK goods exports outside of the US, the EU and China. Today's trade delegation aims to identify and secure further opportunities for UK exporters.
"Making it easier for British firms to export must be a priority for rebalancing the economy. But exporting is not just for big corporates or the tech sector, and that is why we have launched the new 'Exporting is GREAT campaign', focused specifically on small and medium-sized businesses.
Head of Project Marketing at UK Export Finance, John Snowdon said: "This facility offers UK companies the opportunity to expand into Russia by ensuring Russian buyers are able to access competitive financing to pay for UK goods and services. The parameters of the facility are set to target finance at contracts between £1m and £25m."
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