The new export credit rules agreed this week, to be confirmed by January 20, will make financing more expensive using export guarantees because the premiums will be raised from February 1.
Minimum premiums, the new proposals say, will be set annually with reference to market conditions, although more detail on what this will mean in practices has not been forthcoming. However it has been revealed that for in investment-grade airlines, premiums will double to around 8%. A market surcharge has also been introduced that will be revised every quarter.
Deliveries made throughout 2012 are allowed to be financed under the current rules for export credit guarantees, and for all aircraft orders before May 2007 for Boeing and Airbus, and before 2006 for Embraer and Bombardier, says media reports. These waivers have disappointed home country airlines because they say it does not address their immediate concerns over unfair subsidies to cash rich airlines, particularly those in the Gulf, swamping the market with over capacity through cheaply financed aircraft. However it is a step in the right direction, said a spokesperson for British Airways; while Air France threatened to test the new rules by applying for export credit once the new rules come into force.