France welcomes aircraft export credit deal

PARIS, Dec 22 (BestGrowthStock) – French ministers said they were
pleased that aircraft-producing nations had agreed a deal on
export credits, in a move that will cool long-running tensions
between airlines over the system used to sell aircraft.
Airlines have long been lobbying for a change to the rules,
which allow the home governments of U.S. manufacturer Boeing
(BA.N: ) and Europe’s Airbus (EAD.PA: ) — France, Germany, Spain
and Britain — to give export financing to some, but not all
carriers.

“The new agreement allows financial support conditions for
all civil aircraft to be unified,” said Economic Minister
Christine Lagarde, Foreign Trade Minister Pierre Lellouche and
Transport Minister Thierry Mariani.

They did not give details of the deal.

A previous informal agreement between the five countries
involved meant the export credits could not be offered to
airlines based in any of the five countries where Boeing and
EADS subsidiary Airbus are based.

That meant an airline in an Airbus home nation, such as
British Airways (BAY.L: ), would not qualify for U.S. credits when
buying a Boeing in the same way that a U.S. airline buying an
Airbus would not secure European export credits.

Airlines in the countries where Airbus and Boeing planes are
made say they are unfairly locked out of a system of export aid
which reduces costs for major carriers in the Gulf — like
Emirates — and Asia which have grabbed market share from older
rivals. [ID:nN07162741]

The role of export credit financing has increased sharply as
private financing dried up during the financial crisis and the
entry of smaller competitors such as Canada’s Bombardier
(BBDb.TO: ) and Brazil’s Embraer (EMBR3.SA: )(ERJ.N: ) into the market
for larger planes, challenging Airbus and Boeing’s duopoly, has
also brought the issue to a head.
“This new regulatory framework takes into account the
interests of the European manufacturer Airbus, which will
continue to benefit from the state guarantee in some of its
exports,” the French ministers said in a statement. Airbus “will
be subject, as far as financing is concerned, to the same rules
of the game as its competitor Boeing,” they added.

The ministers said the deal would allow for a better balance
between French, German and British airlines and their
competitors.
(Reporting by Helen Massy-Beresford; Editing by Jon
Loades-Carter)

France welcomes aircraft export credit deal