More than two years after the government decided to merge the Export-Import Bank of Japan and the Overseas Economic Cooperation Fund, officials involved in its preparation are now unable to find a good way to unite the two institutions.
According to the government’s March 1995 decision, there are two more years before the consolidation of the two institutions must be completed. But because the plan requires a revision of relevant laws, a concrete blueprint for the merger needs to be wrapped up this year, some officials say.
The OECF, which was set up in 1961, provides developing nations with yen-denominated soft loans for 20- to 30-year terms.
The Export-Import Bank mainly provides credit for Japanese firms’ exports and imports as well as investment in other countries, although in recent years it has also been providing low-interest shorter-term loans to countries moving from typical aid recipient status to that of an advanced nation. The bank was created in 1952.
Officials say the biggest problem is the government’s request that each institution’s tasks not be combined. “The government’s plan seems to be contradictory,” said a government official who declined to be named. “People would naturally wonder what the advantage of making the two corporations into one would be.”
Some analysts even suggest that, although the plan received Cabinet approval when it was submitted, the government should consider canceling it. They say the government instead should consider integrating the Export-Import Bank and the Japan Development Bank in line with its review of government corporations.