Swedish export loan funding for Vietnam Airlines

Vietnam Airlines’ purchasing of new Boeing Dreamliner aircraft, with the first one of those delivered in the end of July 2015, has co-financing from the Swedish Export Credit Corporation (SEK). Swedish funding for U.S-manufactured aircraft to Vietnam, in other words! That prompted the question what the Swedish connection could be, and ScandAsia has looked into it.

SEK, ‘experts in international financing’, lends money to Swedish exporters and their overseas customers. Loans are also awarded international buyers, and for an export project to qualify for financing from SEK there must be an element of Swedish interest. All of the loans that SEK provides to overseas buyers have one thing in common: the proceeds from these loans are used to buy Swedish goods and services.


Export sales can be financed in a number of different ways. SEK makes use of several financing tools available in the market to tailor each loan to the needs of exporters and overseas buyers.

SEK provides funding for one of the four Boeing 787-9 aircraft Vietnam Airlines is buying.

“The Swedish export of aircraft components amounts to approximately Skr 20 billion per year, according to estimations done by the SAI (Swedish Aerospace Industries). The industry consists of quite a number of Swedish SME that export different small parts to each plane and in order to support this important industry SEK has decided to finance a couple of planes every year,” replies Edvard Unsgaard of SEK.

The particular lending to Vietnam Airlines (VNA) is backed by the US Exim, which has closed down. SEK cannot on if it would consider increasing its financing of Boeing planes.

“Every question to us will be investigated separately.”

As for the size of the loan SEK is not at liberty to disclose the credit amount.

“Compared to our core flow of export credits, the amount financed for this particular aircraft is quite normal,” replied Edvard Unsgaard.

The 787 provides airlines with unmatched fuel efficiency, resulting in exceptional environmental performance. The family uses 20 to 30 percent less fuel with 20 to 30 percent fewer emissions than the airplanes they replace, according to manufacturer.

Meanwhile SEK has initiated Green Lending for a selected pool of projects, which promotes the transition to low-carbon and climate resilient growth, as determined by SEK through an evaluation process. In 2015, SEK took further action to support sustainable and eco-friendly business by setting a target of providing Skr 10 billion in green lending over the next three years.

As for the lending to the purchase of Boeing planes, it is however not part of this scheme.

“According to international standard, the finance of the planes is not green lending, even though it is very good that the airplane contributes to fewer emissions,” replied SEK.

As the first European export credit agency SEK has issued its first green bond, amounting to USD 500 million with a maturity of 5 years. The funds from the issue will be used to finance exports of Swedish environmental technology and know-how throughout the world. SEK’s framework for green bonds incorporates a measure of carbon dioxide reduction in the projects that are financed, providing investors with a tool to evaluate the emissions reductions resulting from their investments.

SEK Sustainability Department assesses as to whether a project qualifies as an Eligible Project and validates reported reductions of greenhouse gas emissions. Reductions of CO2 emissions will be measured on a project basis in proportion to the percentage financed by SEK.


“We want to contribute to the development of the green bond market and we’re pleased that this issue was well received by the market and that a high percentage of environmentally focused investors participated. The bond was oversubscribed quickly, despite market conditions not being optimal, in part because of continued uncertainty surrounding Greece,” said Per Åkerlind, Executive Vice President of SEK.

Around 65 percent of purchasers of the bond are ‘ESG’ investors (with a focus on environmental, social and corporate governance issues). In geographical terms, most interest was from Europe (53 percent) and North America (33 percent). Some 29 percent of the bond was purchased by central banks, and a further 29 percent was subscribed by asset management companies.

“Sustainability has long been an important aspect of our business and the green bond market provides us with a tool to earmark capital for a transition to a low-carbon economy,” said SEK’s Chief Sustainability Officer Johan Henningsson.

Examples of Green Lending projects so far:

  • Renewable Energy in India (World’s first multi-terminal UHVDC transmission link, where Swedish ABB delivers the HVDC terminals.)
  • Solar Power in Europe, Africa and America (Siemens Industrial Turbomachinery (SIT) Ltd in Finspång, Sweden, designed and manufactured 13 steam turbines for solar power plants.)
  • Sustainable Transport in Turkey (Construction of metro, with Bombardier’s Swedish subsidiary as exporter.)

About Joakim Persson

Freelance business and lifestyle photojournalist

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