New agreement boosts Danish export to Mexico
EKF Denmark’s Export Credit Agency has signed an agreement with Banorte, one of Mexico's largest banks, on financing of exports from Danish businesses to Mexican buyers. This agreement will primarily boost agricultural, industrial and energy exports.
Under the agreement, Banorte will issue a financing offer to Danish exporters which the exporters can include in their equipment quotation to their prospective buyers.
"Danish exporters gain a significant competitive advantage because it will facilitate financing of Mexican purchasing of goods in Denmark. EKF guarantees the financing, which thereby grants Mexican buyers credit for 3-10 years - for renewables up to 18 years," explains Lars Smed, EKF Chief Underwriter.
“We are convinced that EKF is a great ally to support the investment projects of Mexican companies. With this agreement we will combine Banorte’s specialization in infrastructure and energy with EKF’s experience in renewable energy projects, in line with our commitment to sustainability in Mexico, as well as numerous sectors in which our economies are complementary,” says Marcos Ramírez Miguel, CEO of Grupo Financiero Banorte.
As interest organisations, the Confederation of Danish Industry and the Danish Agriculture & Food Council welcome the new agreement.
"The Confederation of Danish Industry sees the EKF-Banorte partnership as very promising, as a number of our members export to Mexico, and the opportunities on that market are immense in all sectors from agriculture and food to green energy and water supply. With this agreement, Danish exporters are even better placed to compete for orders, as Banorte enjoys high standing as one of the largest commercial banks in Mexico," says Jens Holst Nielsen, Director for International Trade and Market Development, Confederation of Danish Industry.
"EKF's partnership with the customers' banks is the foundation for enhanced export potentials, and the agreement with Banorte gives Danish exporters access to the decision-makers at major customers through a financing scheme. Denmark has a unique value chain within food production. It is coherent, robust and tried-and-tested. This is the foundation for our highly specialised Danish agro- and food industry businesses and hence for their exports," says Susanne Zwergius Teilmann, Market Developer, Trade Policy & Market Access, Danish Agriculture & Food Council.
Intensified focus on Mexico
EKF, the Confederation of Danish Industry and the Danish Agriculture & Food Council all work closely with the Danish embassy in Mexico. In recent years, Danish exporters have intensified their focus on opportunities in Mexico.
Last year, three Danish trade delegations visited Mexico and two - three delegations with focus on water and foodstuffs are expected in 2020.
“There is a great potential for Danish companies here in Mexico within energy, health and foodstuffs. Mexico has a strong home market with approximately 130 million consumers as well as a growing middle class with great purchasing power. Furthermore, Mexico is adjacent to the United States, who is one of the largest economies in the world. The Danish embassy has a close and ongoing cooperation with 40-50 Danish companies.”, says Jacob Green, Deputy Head of Mission, Embassy of Denmark, Mexico.
Several Danish companies such as Vestas and LEGO have established production facilities in Mexico for years in order to be close to the markets in both North America and Latin America.
In 2018, Danish businesses exported DKK 5.7 billion in goods and services to Mexico, while Denmark imported DKK 3.7 billion-worth from Mexico. The Danish Ministry of Foreign Affairs projects that Danish export of goods and services to Mexico is set to increase by 5.5 percent this year. The largest categories of export goods to Mexico are pharmaceuticals, equipment and machinery for industrial businesses.
EKF Denmark’s Export Credit Agency assists Danish businesses with export finance. For details, visit ekf.dk.