Senate debates

Wednesday, 19 March 2014

Questions without Notice

Export Finance and Insurance Corporation

2:43 pm

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

I thank Senator Xenophon for that question and for some notice of it. The Export Finance and Insurance Corporation was established by the then Labor government in 1991. The way it was set up and continues to operate is important to note: it is completely independent of government, within an established commercial framework, supporting viable companies where there is a financial gap in the market. My advice is that this transaction was approved under such a market gap test. I am further advised that, when working within global supply chains, our small and medium sized enterprises need the opportunity to be drawn into the orbit of larger projects. This is a decision taken by EFIC, fulfilling its role and responsibilities as it sees fit and, as I said, entirely independently of government, as is appropriate. The advice I have also been given is that this will assist small and medium sized enterprises to enter the global supply chain. If we are going to compete globally in this supply chain, they need to be in that orbit. In the case of this particular loan, I am advised that the financing will be to the benefit of some 80 Australian companies, large and small, who are engaged in the global mining supply chain. In this case, the longer loan terms required could not be met by the financial market in Chile, and EFIC of course does not undertake projects that do not have any Australian content.

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