Estimated reading time: 4 minutes
For over 65 years, Export Finance Australia (EFA) has been helping businesses take on the world. Over this long history, we have gained a unique perspective on the challenges faced by exporters, and how finance can help address them.
The benefits of exporting are significant. In the 2020-21 financial year, Australian companies exported to more than 230 markets. The total value of goods and services exports out of Australia in 2020-21 was $458.8 billion (Australian Bureau of Statistics (2022) International Trade: Supplementary Information, Financial Year).
In total, Australian exporters generated over $1.5 trillion in turnover, contributing approximately $650 billion to the Australian economy and providing employment for around 3 million Australians.
The most frequent challenge EFA addresses is the need for businesses to secure finance to explore export opportunities. With an explicit mandate to provide commercial finance where market gaps exist, EFA has designed specific offerings for SME exporters, who constitute 88% of all Australian exporters. EFA also provides finance to larger corporate entities or those requiring specialist project finance.
Long-standing obstacles in the path of export opportunities and finance include breaking into new markets, setting up overseas operations, and securing customers without prior in-market experience. Some commercial finance can be challenging to secure, such as for business expansion into other countries or for working capital requirements to fulfil international orders. EFA addresses these challenges with offerings of loans, bonds, and guarantees, taking on financing challenges others may shy away from.
In recent years, Australian exporters have also been confronting new challenges. These include COVID-19 pandemic restrictions, supply chain disruptions, extreme weather events, escalating air and sea freight costs, delays in receiving stock, and lags in product delivery to buyers.
These issues have necessitated higher levels of working capital for businesses to maintain their export operations. In response, EFA has worked with our customers to ensure our offerings are evolving as business needs change. For example, we have expanded the scope of our online Small Business Export Loan product to simplify eligibility criteria and add new financing purposes to meet the changing needs of SMEs.
EFA’s support across the globe
Our customers span a diverse range, from individuals who’ve grown businesses from their garages into global brands, to companies needing finance to supply products to international customers, and even businesses with permanent operations overseas.
Over the past decade, we’ve provided more than $9 billion in finance, supporting almost 700 customers with exports to over 100 different countries. This has supported over $30 billion in exports and projects. We tailor our offerings to each transaction, meaning we devote time to understanding your needs and finding the right solution.
In addition to our support for SMEs, we also have a mandate to finance Indo-Pacific infrastructure projects, critical minerals projects and defence exports. For businesses and projects in these sectors, we have specific offerings.
For Indo-Pacific infrastructure, we provide project finance for overseas projects that provide a benefit to Australia – including opportunities for Australian companies to work as contractors or to supply into those projects. For example, we provided a $30 million loan to support the rollout of an EV bus fleet and national charging network in Vietnam and are working with Austrade to connect Australian businesses to the opportunities supported by our financing.
In the critical minerals sector, we have approvals in place for over $1.6 billion in finance for Australian critical minerals projects. EFA has also supported Australian SMEs participating in these export projects, by providing loans and bonds, so they can benefit from this fast-growing sector.
In the defence industry, there are solutions that enable SMEs to become part of the supply chains of major international prime contractors and participate in key defence projects.
Case studies
Here are just a few real examples of how EFA has supported Australian exporters:
McGregor Coxall is an interdisciplinary design firm that offers a range of services, including landscape architecture, urban design, engineering and city intelligence and design research. EFA provided a loan facility known as an export line of credit to McGregor Coxall. This enabled the business to pay for upfront business expenses such as salaries and wages before they received payment, ensuring the successful delivery of design services to an international client in the Middle East.
Easy Signs, an online signage manufacturer with 120 employees, launched its export journey in 2019. EFA provided Easy Signs with an Overseas Direct Investment Loan to set up operations in the USA, enabling it to be closer to its customers and continue its growth.
Marr Contracting (aka the Men from Marr’s) is a world leader in the design and delivery of heavy lift luffing cranes and other complex craneage solutions. Marr Contracting supports large-scale projects across the construction, infrastructure and resources sectors. We provided an export contract loan and performance bond facility that enabled Marr Contracting to purchase equipment and deliver contracting services for the high-profile 1915 Canakkale Bridge and Motorway Project in Turkey.
At EFA, we have witnessed remarkable levels of innovation and resilience across various exporting industries, with Australian businesses often leading the global stage within their sector. We look forward to continuing to support more Australian businesses on their export journey.
Comments are closed.