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U.S. To Help Vietnam Buy Four Boeing 787s  
User currently offlineKeesje From , joined Dec 1969, posts, RR:
Posted (7 years 10 months 3 hours ago) and read 4836 times:

HANOI, Vietnam: The U.S. Export-Import bank http://www.exim.gov/ has given Vietnam Airlines preliminary approval for a US$400 million loan to help purchase four Boeing 787 airliners, the U.S. Embassy announced Wednesday.

http://www.iht.com/articles/ap/2006/.../asia/AS_FIN_Vietnam_US_Boeing.php

Ealier on the EXIM bank financed large 787/777 deals for airlines like Air Canada, Air India and Emirates.

The Export-Import Bank supports the financing of U.S. goods and services, maintaining, and creating more U.S. jobs...


I really like the Vietnam Airlines livery

35 replies: All unread, showing first 25:
 
User currently offlineBobski From United Kingdom, joined Feb 2006, 83 posts, RR: 1
Reply 1, posted (7 years 10 months 3 hours ago) and read 4828 times:

Damn those Airbus anti-competitive subsidies, they should be more free-market and fair, like Boeing...

Oh wait...

As long as Boeing gets US Government support for its customers to buy its products, Airbus will get cheap loans from the EU. Its the same thing, honest hard-working taxpayers like us having to foot the bill for Airbus/Boeing to get orders.

I love aviation, and I love airliners, but this kind of thing makes me sick, it really does.



Who is Benjamin Breeg?
User currently offlineSupa7E7 From , joined Dec 1969, posts, RR:
Reply 2, posted (7 years 10 months 3 hours ago) and read 4807 times:

Nice, but it is hard to believe this type of thing is permited by WTO. Below-market loans (or generous credit) is similar to a state subsidy.

"Ex-Im Bank does not compete with private sector lenders but provides export financing products that fill gaps in trade financing. We assume credit and country risks that the private sector is unable or unwilling to accept. We also help to level the playing field for U.S. exporters by matching the financing that other governments provide to their exporters."
- Ex-Im bank website

Other industrial countries probably do the same thing. Nontheless, it is unclear why the government needs to pump money into deals no commercial bank wants to touch.


User currently offlineBobski From United Kingdom, joined Feb 2006, 83 posts, RR: 1
Reply 3, posted (7 years 10 months 3 hours ago) and read 4802 times:

Quoting Supa7E7 (Reply 2):
Other industrial countries probably do the same thing. Nontheless, it is unclear why the government needs to pump money into deals no commercial bank wants to touch.

Its to guarantee jobs and to maintain Boeing's market position. With Government subsidies, Airbus and Boeing would both struggle and neither of them would be able to produce new aircraft nearly as frequently as they do now.



Who is Benjamin Breeg?
User currently offlineAA1818 From Trinidad and Tobago, joined Feb 2006, 3433 posts, RR: 4
Reply 4, posted (7 years 10 months 3 hours ago) and read 4785 times:

Can we expect Vietnam to firm up any options now that they have secured financing for the original 4- they have loads of options- 11 i believe!

AA1818



“The moment you doubt whether you can fly, you cease for ever to be able to do it.” J.M. Barrie (Peter Pan)
User currently offlineKeesje From , joined Dec 1969, posts, RR:
Reply 5, posted (7 years 10 months 3 hours ago) and read 4770 times:

Quoting Supa7E7 (Reply 2):
"Ex-Im Bank does not compete with private sector lenders but provides export financing products that fill gaps in trade financing. We assume credit and country risks that the private sector is unable or unwilling to accept. We also help to level the playing field for U.S. exporters by matching the financing that other governments provide to their exporters."
- Ex-Im bank website

EK 777-300ER´s, including engines.



[Edited 2006-11-08 12:53:37]

User currently offlineFoxBravo From United States of America, joined Nov 2003, 2996 posts, RR: 4
Reply 6, posted (7 years 10 months 1 hour ago) and read 4618 times:

Quoting Bobski (Reply 1):
As long as Boeing gets US Government support for its customers to buy its products, Airbus will get cheap loans from the EU. Its the same thing, honest hard-working taxpayers like us having to foot the bill for Airbus/Boeing to get orders.

Totally different. This is not a loan from the government to Boeing. This is export credit support, which is done all over the world--Brazil does it for Embraer, Canada does it for Bombardier, and you can be sure that Europe does it for Airbus. In fact, Vietnam Airlines has received the same sort of support from Europe for its Airbus purchases. See, for example, this press release from a law firm that represented the airline: http://www.whitecase.com/news/detail.aspx?news=396

Folks, please get your facts straight before turning a run-of-the-mill press release into another launchpad for a pointless A v. B battle.  Sad



Common sense is not so common. -Voltaire
User currently offlineBobski From United Kingdom, joined Feb 2006, 83 posts, RR: 1
Reply 7, posted (7 years 9 months 3 weeks 6 days 22 hours ago) and read 4286 times:

Quoting FoxBravo (Reply 6):
Totally different. This is not a loan from the government to Boeing. This is export credit support, which is done all over the world--Brazil does it for Embraer, Canada does it for Bombardier, and you can be sure that Europe does it for Airbus. In fact, Vietnam Airlines has received the same sort of support from Europe for its Airbus purchases. See, for example, this press release from a law firm that represented the airline: http://www.whitecase.com/news/detail.aspx?news=396

Folks, please get your facts straight before turning a run-of-the-mill press release into another launchpad for a pointless A v. B battle.

It is exactly the same, because the money is still ending up in Boeing's pockets, just via a different route. The money is being loaned by the US Government with the express purpose of securing orders for Boeing. Its exactly the same as Airbus being lent money to compete with Boeing on airliners. This isn't Boeing v Airbus, its free market v Government interference. I'm not condemning Boeing whilst supporting Airbus, I hate all the subsidies because I see them as a waste of tax money. If you read my post properly, you'll note that I say the whole thing stinks on all sides.



Who is Benjamin Breeg?
User currently offlineGr8Circle From Canada, joined Dec 2005, 3100 posts, RR: 4
Reply 8, posted (7 years 9 months 3 weeks 6 days 21 hours ago) and read 4200 times:

Quoting Bobski (Reply 7):
I'm not condemning Boeing whilst supporting Airbus, I hate all the subsidies because I see them as a waste of tax money. If you read my post properly, you'll note that I say the whole thing stinks on all sides.

Just curious to know how some of you view this sort of thing as a "waste of tax money". These loans ensure that American or European products are sold, which in turn provides manufacturing sector jobs and keeps the economy rolling, whichever side of the Atlantic it may be.....ultimately, the concerned airline would also repay the loans, right? So, where is the waste of tax money....? I thought governments were supposed to use public money to enhance the economy overall....and remember, along with the aviation industry, both the US as well as European governments would be similarly supporting other strategic industries as well.....


User currently offlineRoseFlyer From United States of America, joined Feb 2004, 9619 posts, RR: 52
Reply 9, posted (7 years 9 months 3 weeks 6 days 20 hours ago) and read 4105 times:

Quoting Bobski (Reply 7):
It is exactly the same, because the money is still ending up in Boeing's pockets, just via a different route. The money is being loaned by the US Government with the express purpose of securing orders for Boeing.

No the express purpose of the loans is to generate exports. The US government does this as a way to lower the trade deficit rather than using your tax dollars to pay for the massive trade defiicit. This financing is one way to loan money out for exports. Other ways are to sell the debt off to other countries to fund imports. Collectively Japan and China own a significant part of the US government since they purchased the US government's debt at the market interest rate for a no risk loan. By promoting exports, the US government is causing capital to flow back in to the United States. You might think that the money goes out in a loan and comes right back with a below market interest rate, but that isn't the way that the government loans money since the government is not a bank. The government gains more than the interest since taxes are paid on the purchase of a new plane and jobs are generated and the loan is not for the entire amount of the plane. In the end all of the money does get paid back to the US government and therefore the trade deficit decreased. The US government is benefiting the US economy by promoting exports. Boeing strongly benefits from this of course more than other companies, but that is primarily because based on a dollar amount, Boeing is the United States' largest exporter.

This isn't about securing orders and helping a private company as much as it is about helping the US economy. If Airbus manufactured its planes in the United States and if its revenue for those planes stayed in the United States, the US government would just as happily give loans to foreign governments and companies to fund purchases. These loans are offered on things other than airplanes. The same loans help other industries, although aviation is one of the few heavy industries that the United States is actually competitive in.



If you have never designed an airplane part before, let the real designers do the work!
User currently offlineATCT From United States of America, joined Mar 2001, 2288 posts, RR: 38
Reply 10, posted (7 years 9 months 3 weeks 6 days 20 hours ago) and read 4081 times:

Awesome. I hope those Vietnam B787's are used for some US runs!

I cant wait to seem em.

ATCT



"The way to get started is to quit talking and begin doing." - Walt Disney
User currently offlineAeropiggot From United States of America, joined May 2005, 283 posts, RR: 0
Reply 11, posted (7 years 9 months 3 weeks 6 days 20 hours ago) and read 4042 times:

Quote:
To Keesje et al.........

This is just business as usual, both the European Union and the United states, have EXIM type banks, that facilitates exports loan for big ticket manufacturered goods. Those who compare this to the type of subsidies Boeing as accused Airbus of receiving from the European government are comparing apples and oranges.



A scientist discovers that which exists, an engineer creates that which never was.
User currently offlineHamlet69 From United States of America, joined Mar 2000, 2744 posts, RR: 58
Reply 12, posted (7 years 9 months 3 weeks 6 days 19 hours ago) and read 3983 times:

Quoting Bobski (Reply 1):
As long as Boeing gets US Government support for its customers to buy its products, Airbus will get cheap loans from the EU. Its the same thing, honest hard-working taxpayers like us having to foot the bill for Airbus/Boeing to get orders.

I'm sorry to be blunt, but you have NO IDEA what you are talking about.

The U.S. Ex-Im bank is a financial institution set up to guarantee market loans which thereby encourages foreign sales of U.S. products. In layman's terms, here's how it works in relation to aircraft orders:

An airline, in this case VN, wants to purchase certain aircraft from Boeing. They need to arrange the financing to do so, and therefore put in an application with Ex-Im (btw - as a foreigner, you can do so yourself: http://www.exim.gov/news/exim_online_spl.cfm). Once the application is approved, in most cases a private financial institution then provides the actual financing, while the Ex-Im charges an exposure fee. You can find a list of lenders on the website noted above. This loan is done with the BACKING of Ex-Im, but not done BY Ex-Im. While one can take out a loan directly from Ex-Im, this is not usually done.

Almost all industrialized countries have such a system, as pointed out previously. They are usually referred to as "Export credit agencies" (ECA's). If you had bothered to read the link provided by FoxBravo, you would have seen the names of the three major ECA's of Europe that support Airbus sales: COFACE (France), Euler Hermes (Germany), and ECGD (U.K.).

Quoting Bobski (Reply 7):
It is exactly the same

As you can see, it's not. If you can not see that, I will try and explain more clearly.

Regards,

Hamlet69  profile 



Honor the warriors, not the war.
User currently offlineRichard28 From United Kingdom, joined Aug 2003, 1619 posts, RR: 6
Reply 13, posted (7 years 9 months 3 weeks 6 days 19 hours ago) and read 3944 times:

good explanation Hamlet69.

It can however still be said that the government is guaranteeing the loans - which the market would otherwise be unable or unwilling ( or perhaps too expensive?) to support.

So in its way it still amounts to a form of government aid.

As you say every government does it. Indeed in the UK most apparently goes to the arms trade, which is a much sicker state of affairs than it being used to benefit an airline purchasing airliners.


User currently offlineFumanchewd From , joined Dec 1969, posts, RR:
Reply 14, posted (7 years 9 months 3 weeks 6 days 19 hours ago) and read 3921 times:

Quoting Bobski (Reply 1):
Damn those Airbus anti-competitive subsidies, they should be more free-market and fair, like Boeing...



Quoting Supa7E7 (Reply 2):
Nice, but it is hard to believe this type of thing is permited by WTO. Below-market loans (or generous credit) is similar to a state subsidy.

Typical selective European cynicisim. Anyone remember a certain war in the 60's and 70's. America has been continually assisting the current Vietnamese government in a number of ways. This is just a matter of us trying to set things right.

And you all jump on your nationalistic bandwagons instead of seeing the good that will come of this.

Some examples of aid to Vietnam in ALL areas.

http://www.fas.org/sgp/crs/row/RL32636.pdf
1990s. As the
normalization process has proceeded, the U.S. has eliminated most of the Cold Warera
restrictions on U.S. aid to Vietnam, and U.S. assistance has increased markedly
from around $1 million when assistance was resumed in 1991 to nearly $50 million
in FY2004.


http://hanoi.usembassy.gov/pr040406i.html
The Vietnam Red Cross and American Red Cross, in cooperation with the Ministry of Education, will use $2.7 million in proceeds from the sale of this shipment, as well as proceeds from another donation arriving later in the year to assure that 60,000 primary school children in Vietnam receive a nutritious meal each day while attending school. The project targets 169 schools in six central and northern Vietnamese provinces with high malnutrition and poverty rates. The donation comes from the United States Department of Agriculture Food for Education program.

http://www.confectionerynews.com/news/ng.asp?id=14298-us-to-aid
Vietnam's burgeoning cocoa industry received a significant boost last week after the US government confirmed it would provide $4 million (€3.4m) in development aid.

The move comes after concerted efforts by the Vietnamese government to diversify the country's agricultural produce.


There's alot more as well.

Sure this helps an American company, but quite a few myopic a.net members seem to completely miss the point that this is primarily an act of reconciliation and strengthening diplomatic ties with a previous "enemy" government.

Congratulations to the US, the Vietnamese people, and congratulations to Boeing.

[Edited 2006-11-10 21:28:21]

User currently offlineHamlet69 From United States of America, joined Mar 2000, 2744 posts, RR: 58
Reply 15, posted (7 years 9 months 3 weeks 6 days 18 hours ago) and read 3888 times:

Quoting Richard28 (Reply 13):
It can however still be said that the government is guaranteeing the loans

Indeed they do. That is, in essence, the point of ECA's. Thus, also the reason why a company must put in an application with an ECA to be approved or rejected, based on that ECA's own evaluation of the application.


Regards,

Hamlet69  profile 



Honor the warriors, not the war.
User currently offlineN1786b From United States of America, joined Sep 2005, 559 posts, RR: 17
Reply 16, posted (7 years 9 months 3 weeks 6 days 17 hours ago) and read 3803 times:

Quoting Bobski (Reply 1):
I love aviation, and I love airliners, but this kind of thing makes me sick, it really does.

I must ask you - were are your comments about COFACE (France), Euler Hermes (Germany), and ECGD (U.K.)? Are you still "sick" when they are supporting Airbus sales?

And you Keesje? Stop drinking the coolaid. When your head clears, you may condem COFACE just as quickly as the US EXIM bank.

-n1786b


User currently offlineRoseFlyer From United States of America, joined Feb 2004, 9619 posts, RR: 52
Reply 17, posted (7 years 9 months 3 weeks 6 days 17 hours ago) and read 3785 times:

Here are some short excerts from the COO of United Technologies regarding Vietnam and aviation potential. United Technologies is the parent company of some of the larger aviation companies in the United States: Pratt & Whitney, Sikorsky and Hamilton Sundstrand, which would see increased business with more aviation infrastructure in Vietnam.

President and COO Louis Chênevert said establishing permanent normal trade relations between the United States and Vietnam is overdue. Speaking at an American Chamber of Commerce luncheon Oct. 24 in Ho Chi Minh City, Vietnam, Chênevert said UTC strongly supports permanent normal trade relations for Vietnam and has been an advocate in urging the U.S. Congress to take action granting this status.

Chênevert concluded his remarks by noting positive developments taking place in Vietnam including the country’s liberalized economic policy that is leading to growing foreign investment. He also cited strong growth projected for Vietnam’s aviation sector, and said the trend toward urbanization, the rate of which is projected to double by 2030, could mean opportunity for the building equipment industries. “In Vietnam I see great potential for a bright future,” Chênevert said.



If you have never designed an airplane part before, let the real designers do the work!
User currently offlineFlysherwood From United States of America, joined Jul 2006, 1115 posts, RR: 0
Reply 18, posted (7 years 9 months 3 weeks 6 days 17 hours ago) and read 3770 times:

Quoting Bobski (Reply 1):
As long as Boeing gets US Government support for its customers to buy its products, Airbus will get cheap loans from the EU. Its the same thing, honest hard-working taxpayers like us having to foot the bill for Airbus/Boeing to get orders.

First of all, all the US Government is becoming is a co-signer on the loan that Vietnam must make with a private bank in the U.S. This is not subsidization. Every country in the EU has a similar process for exporting their products.


User currently offlineStirling From Italy, joined Jun 2004, 3943 posts, RR: 21
Reply 19, posted (7 years 9 months 3 weeks 6 days 17 hours ago) and read 3737 times:

Talk about making a mountain out of mole-hill! and the complete ignorance of how things work! This is a prime example!

Quoting Supa7E7 (Reply 2):
Nice, but it is hard to believe this type of thing is permited by WTO

They work closely with each other.

Any nation that has an export economy, meaning, they make stuff to send beyond their borders, they are going to have an arm of government, or some other vehicle to enhance the attractiveness of the domestically produced item in foreign markets.
What is so hard about this to undestand?



Delete this User
User currently offlinePlanemaker From Tuvalu, joined Aug 2003, 6158 posts, RR: 35
Reply 20, posted (7 years 9 months 3 weeks 6 days 17 hours ago) and read 3715 times:

Quoting Fumanchewd (Reply 14):
Anyone remember a certain war in the 60's and 70's. America has been continually assisting the current Vietnamese government in a number of ways. This is just a matter of us trying to set things right.

How about setting things right with Cuba?  Big grin



Nationalism is an infantile disease. It is the measles of mankind. - A. Einstein
User currently offlineShenzhen From United States of America, joined Jun 2003, 1710 posts, RR: 2
Reply 21, posted (7 years 9 months 3 weeks 6 days 17 hours ago) and read 3678 times:

Germany to help finance over 300 airplanes for the Chinese....

Export Credit Guarantees of the Federal Republic of Germany

China holds second place with cover to the tune
of 584 million EUR (first half of 2006). After the previous year’s
record figure, this is a decrease of 60 % (from 1.36 Billion). Large
guarantees were assumed for investments for..... Airbus aircraft.
As in the preceding years, capital goods transactions are carried out almost exclusively on short payment terms.

Cheers


User currently offlineFumanchewd From , joined Dec 1969, posts, RR:
Reply 22, posted (7 years 9 months 3 weeks 6 days 16 hours ago) and read 3647 times:

Quoting Planemaker (Reply 20):
How about setting things right with Cuba?

Off subject but I'll post one statement on that...

IMO things are right with Cuba. I love the people but am well aware of the historical actions of Castro.

As for Vietnam, our trade has been increasing with them every year and a government sponsored loan is a good thing for the people and inconsequential. BTW, there are alot of Vietnamese Americans who will be happy to have easier access to their homeland. I believe that people shouldn't bother looking at this as an A vs B but as a country being given something very important for its economy and its people.


User currently offlinePlanemaker From Tuvalu, joined Aug 2003, 6158 posts, RR: 35
Reply 23, posted (7 years 9 months 3 weeks 6 days 16 hours ago) and read 3647 times:

Quoting Shenzhen (Reply 21):
Germany to help finance over 300 airplanes for the Chinese....

And this with the amount of foreign currency reserves China holds...



Nationalism is an infantile disease. It is the measles of mankind. - A. Einstein
User currently offlineAtmx2000 From United States of America, joined Oct 2004, 4576 posts, RR: 38
Reply 24, posted (7 years 9 months 3 weeks 6 days 16 hours ago) and read 3617 times:

Quoting Fumanchewd (Reply 14):
Typical selective European cynicisim. Anyone remember a certain war in the 60's and 70's. America has been continually assisting the current Vietnamese government in a number of ways. This is just a matter of us trying to set things right.

Oh that's a load of crock. This has nothing to do with setting "things right".
The US and Vietnam have a common interest in the containment of China, and improving relations are in part a result of that. Vietnam fought a war with China, who had supported Vietnamese Communists against South Vietnam and the US, in the late 70s which they won relatively quickly. But China was a backwards country back then. As China becomes technologically sophisticated, Vietnam can't expect to win so easily so they need allies. That has led to increased military contacts and even talk of a US naval base in Vietnam.



ConcordeBoy is a twin supremacist!! He supports quadicide!!
25 Fumanchewd : So you actually believe that trade has nothing to do with it, its all balance of power? That's a crock. Vietnam will never agree to a Naval base. I a
26 777ER : Wow, that livery really makes the B787 stand out. Got to love colourful liverys like that
27 Post contains images Stitch : Actually, once the Soviets left Cam Rah Bay (sic), the Vietnamese floated the idea of letting the US back once we lost Subic Bay in the Phillipines.
28 Post contains links Atmx2000 : I believe Vietnam proposed the idea. The only reason why Vietnam may not offer the base is worries about what China might do to them. http://www.atim
29 Fumanchewd : Setting things right is diplomacy-which is directly related to economics and trade. This has everything to do with it.
30 Fumanchewd : About as strategic as Myanmar, but we aren't helping them to finance aircraft.[Edited 2006-11-11 01:25:17]
31 AirNZ : Yep, indeed it does....especially when US companies suddenly see it as in their economic interest! Quite simply, Vietnam has markets that US companie
32 TrevD : Hamlet - great response! Welcome to my respected users list. And don't be too hard to on Keesje, Airbus marketing doesn't have any positive news of t
33 BoomBoom : Boeing vs. Airbus Clash of the Corporate Welfare Titans By Timothy P. Carney July 2005
34 Atmx2000 : Myanmar is dependent on China and is their client state, Vietnam is not. Quite frankly it doesn't work that way. Countries without access to US inves
35 Planemaker : What does Castro have to do with it? 50K American soldiers didn't lose their lives in Cuba. Yes, this is a bit off topic but it does illustrate how p
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