The Financing Frayby Candace Port-Hull, Contributing Editor; Worldwide Projects, 3804 Underwood St., Chevy Chase, MD 20815,
Serial Information: Worldwide Projects, 1993, Vol. 1, Issue 2, Pg. 26-29
Document Type: Feature article
Abstract: Interview with two executives of the U.S. firm Morrison-Knudsen: Donn Smith, senior vice president of project finance at M-K's International Group, and Richard White, vice president of international operations and marketing at its Transportation and Water Resources Group. They say that, with financing crucial to winning contracts in developing countries, U.S. firms are often at a disadvantage because of mixed-credit programs (a combination of standard export credit financing, concessionary loans and bilateral aid) offered by such countries as France, Italy and Japan. In the last year or so, however, the Japanese have been much less aggressive in buying contracts overseas, partly because of their troubled banking sector, while the French and Italians have had budget problems. The U.S. government is trying to rein in mixed-credit programs, but it also offers U.S. firms some help through the Export-Import Bank and the Trade and Development Agency, which funds feasibility studies and other project planning services by U.S. firms (though only to a limited extent). Financing is less of a problem in certain countries, such as Taiwan, and on projects for multinational consumer-product companies that need production or distribution facilities. M-K is involved in BOT (build, operate, transfer) projects in Canada and Argentina; these offer additional risk but also additional profit. The procedure within Morrison-Knudsen for putting together a financing package is discussed, as are sources of project information and procurement and M-K's recent venture into rail passenger-car manufacturing.
Subject Headings: International development | Financing | Competition | Engineering firms
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