Ex-Im Bank to fund US$1 billion GE venture in Angola

GE chuck miller flickrThe Export Import (Ex-Im) Bank of the US has agreed to finance a deal worth US$1bn between GE and the government of Angola to purchase railway and energy equipment

The US-based lender will help GE with funds to rebuild Angola's transport, electricity and communication networks, which were destroyed by war in 2002.

The loans from Ex-Im Bank will include US$350mn for locomotives and US$650mn for power equipment. This deal is part of the Power Africa initiative, where the Ex-Im Bank is set to provide US$5bn for private investments across the continent, said Reuters.

The IMF said Angola's US$122bn economy is set to grow by 5.3 per cent this year, and then by 5.5 per cent and 5.9 per cent in the next two years. Angola's crude oil production alone contributes to 95 per cent of the nation's revenue and the Ex-Im Bank hopes to help diversify its economy by boosting other sectors.

Jose Eduard Dos Santos, president of Angola, has given the Finace Ministry the “green light to move forward” with the deal after meeting with Ex-Im Bank officials.

The US has always maintained good business relations with Angola. Oil companies like Exxon and Chevron have a solid presence in the country but the US is keen to expand these relations into other parts of Angola's economy.

Ex-Im Bank has previously financed a US$600mn deal for TAAG Angola Airlines, the state-owned carrier of the country, to buy aircraft from The Boeing Company, according to a BA Analyst Report.

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