HUNGARIAN ENVIRONMENTAL AND SOCIAL POLICY APPLIED IN EXPORT CREDIT
During financing of export credits, integration of aspects of environmental protection (including sustainable development) is considerably important therefore environmental and social impacts and risks are taken into account during our evaluation process. By this the institution contributes to environmental protection as it cannot provide support for an environmentally harmful project.
The Government Decrees regulating the activities of Hungarian Export-Import Bank PLC (Hereinafter referred to as "the Bank") stipulate that beside the conditions of financing the Bank shall also consider the environmental and social aspects of the project according to the OECD common approachescommon approaches.
The Bank can only provide export credit guarantee according to point 2 (b) of paragraph 7 of Government Decree 435/2012 on Guarantees Assumed by the Hungarian Export-Import Bank with a State Payment Guarantee and on the Conditions and Detailed Regulations of the Replacement and Interest Costs of Foreign Currency and Interest Swap Transactions, if the transaction to be financed is not harmful for the environment as a result of the environmental screening carried out on the basis of OECD common approaches on Export Credits and Social Due Diligence.
The interest equalisation can only be taken for export credits with the period of 2 years or more than 2 years, for export credits for refinancing and for financing purchase of receivables according to point 2 (b) of paragraph 5 of Government Decree 85/1998 on Interest Equalisation System of the Hungarian Export-Import Bank, if the transaction to be financed is not harmful for the environment as a result of the environmental screening carried out on the basis of OECD common approaches on Export Credits and Social Due Diligence.
The OECD Common Approaches was developed and adopted in 2003. It established a set of rules for the environmental risk assessment of officially supported export financing. The document contains common practices for identifying and mitigating the environmental impact of projects. In addition to the impact on the environment, there has been an increasing emphasis on assessing social impacts. The OECD has expanded its existing approach with elements on social impact assessment and finalized it in 2012. In 2016, it has been revised which is the current version in use. The OECD Common Approaches aims to develop procedures for assessing the environmental and social impacts of officially supported export financing, to prevent and mitigate the adverse environmental and social impacts of projects, and to create the overall process of financial risk assessment for a supported project.
PRINCIPLES OF HUNGARIAN ENVIRONMENTAL AND SOCIAL POLICY APPLIED WITH EXIM
- It should comply with Hungarian legal requirements, international obligations, environmental social and human rights agreements undertaken by Hungary.
- It should respect the laws and competition aspects of business secrecy, in accordance with the laws on public disclosure of environmental information.
- The operating rules and procedures should be flexibly applicable and could be further developed.
- The Bank cooperates with stakeholders in assessing environmental and social impacts and respects the sovereign rights of the purchasing country.