The Taiwan government's National Development Fund (NDF) has approved the establishment of a NT$10 billion (US$345.7 million) lending program to offer loans for exports of green energy products. To encourage local banks to participate in the program Taiwan's Small and Medium Enterprise Credit Guarantee Fund is planning to set up a fund to specifically provide local banks with credit guarantees, according to industry sources.
According to the NDF's management committee, loan guarantees will encourage banks to finance projects and would benefit firms that plan to set up solar PV power plants overseas. The NDF added that the main financing bank will be the Export-Import Bank.
The NDF's NT$10 billion (US$344 million) plan to provide funding for solar firms to invest in overseas projects was passed in the second half of September 2012. According to the plan, for every project, the NDF will provide two-thirds of the total funding while banks finance the rest. Nevertheless, banks need to be responsible for 100% of the risks. This has caused banks to be reluctant to back projects, especially ones that are overseas.
The suggestion of providing credit guarantees will be discussed by the related authorities on November 16, 2012.
