GE Deal With UK Export Body Creates 1,000 Jobs

GE Deal With UK Export Body Creates 1,000 Jobs

The American industrial giant GE will announce a deal on Thursday with a Government finance agency that could see up to 1,000 jobs created in Britain's embattled energy sector.

Sky News understands that GE & UK Export Finance (UKEF) will jointly unveil a memorandum of understanding that paves the way for more than £8bn of financing support for projects involving the conglomerate's energy unit.

Sources said the agreement had been signed by ministers & Mark Elborne, GE's UK chief executive, during a private meeting in Downing Street earlier on Thursday, & would be announced shortly.

News of the potential job creation programme may offer some relief amid uncertainty facing more than 2,000 steelworkers on Teesside , whose Thai-based employer, SSI, is facing a financial crunch during the coming days.

The GE-UKEF deal will include the capacity to provide financing support for more than £7.7bn of projects under consideration by GE's energy arm, as well as a ‘top-up’ support facility of up to £500m, depending upon individual project approval & due diligence.

Sources said the announcement would moreover include the disclosure that GE had been approved as a member of UKEF's Direct Lending Facility Partnership Panel, which arranges Government loans to overseas buyers of UK exports.

Such a substantial deal with a major multinational is unusual for UKEF, which last year provided £2.7bn of support to domestic exporters & overseas buyers of those exports.

GE is among the UK's biggest inward investors across its different activities, employing more than 17,000 people in its industrial business units.

Its Oil & Gas Subsea Systems division, which is based in Aberdeen, exported $1.3bn-worth (£850m) of products to 54 countries last year.

According to a copy of the announcement seen by Sky News, David Cameron will hail the agreement as "fantastic news". 

He will say: "We are doing everything we can to make Britain the best place in Europe to start, finance or grow a business.

"It will provide jobs & security for people working in the energy sector & elsewhere. It is a vote of confidence in our long-term economic plan."

The deal with UKEF will come amid criticism levelled by GE against the US government over uncertain prospects for the country's Export-Import Bank.

Jeff Immelt, the GE chairman & chief executive, who was present at Thursday's signing with UKEF, is expected to deliver another veiled rebuke to Republican opponents of ExIm Bank by warning that "in today's competitive environment, countries that have a strong export credit agency will attract investment."

Mr Immelt is expected to say: "We are fortunate to have the support of UKEF – one of the most flexible [export credit agencies] in the world.

"The UK is pro-export & pro-manufacturing."

Critics of Britain's export performance say the Government has been too slow to deliver the required resource to UKEF & complained that its overseas trade strategy, which is led by UK Trade & Investment, is often ponderous & of little value to smaller companies.

Source: “Sky News”