Czech Export Bank Will Continue Crediting Uralvagonzavod Upgrade

08.05.2009 — News

THE SVERDLOVSK OBLAST.

The Czech Export Bank will continue crediting the ALTA equipment and components supplies for OAO NPK Uralvagonzavod (Ural Railway Car Plant). The Russian Government can help strengthening the financial relations.

In the spring 2006 Uralvagonzavod opened a credit facility with the Czech Export Bank to the amount of 300 million Euro. In accordance with the terms of the contract, one of the largest companies of the Sverdlovsk Oblast shall use 40% of the funds to purchase equipment made in the Czech Republic and 60% to purchase equipment from any other producers. In 2007 the bank raised the credit facility limit to 1 billion Euro.

At the end of March 2009 the plant stopped its car-building production line due to a considerable decrease in the amount of orders form OAO Russian Railways. More than 20 thousand workers are on a forced vacation now.

Miroslav Rames, the Consul General of the Czech Republic in Ekaterinburg, told RusBusinessNews that the current economic situation will not influence the crediting of the Urals company. The Czech Export Bank's policy is highly conservative and the bank only finances those projects which were examined in every detail and only if they are entirely transparent. Moreover, the Czech state-owned insurance company EGAP considers such financing programs very thoroughly.

In the beginning of April Viktor Khristenko, the Russian Minister for Industry and Trade, had a meeting with his Czech colleague Martin Riman in Ekaterinburg. The parties agreed to consider, in the nearest future, the option to prolong the repayment period for the loans received by Uralvagonzavod as well as to review the amount and procedure for the subsequent loan repayments.