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					 EDC MEXICO
 Export Development Canada
International Business Development Group
                April, 2007
EDC: FACILITATING CANADIAN TRADE

       ● EDC is Export Development Canada (Exportation et
         développement Canada) Canada’s official export credit
         agency (ECA).

       ● EDC helps:
             Canadian firms complete international sales,
             foreign buyers purchase Canadian goods & services
            and,
             Canadian firms invest with confidence

       ● Founded in 1944, EDC is owned by the Government of
         Canada and operates as a commercial financial institution.
         EDC is AAA rated.




                                                                  2
 CORPORATE MANDATE


             At EDC our mandate

to support and develop, directly or indirectly,

Canada’s export trade and Canadian capacity

     to engage in that trade as well as to

respond to international business opportunities,

            guides everything we do.



                                                   3
            CORPORATE PROFILE

● As a Crown corporation EDC reports to Parliament through the
  Minister for International Trade. – David Emerson

● EDC provide trade finance and risk management services in excess
  of 66.1 billion in 2006, a 15 per cent increase over 2005.

● EDC also facilitated a record $15.2 billion in trade with emerging
  markets and $6 billion in Canadian direct investment abroad in 2006,
  increases of 14 per cent and 50 per cent, respectively, over 2005.

● EDC served Canadian exporters and investors in 177 foreign markets

● More than 85 per cent of EDC’s customers are small- and medium-
  sized enterprises.

● about 1200 employees with HQ in Ottawa.


                                                                         4
          CORPORATE PROFILE

Head Office:
     Ottawa

Business Development Group
National Sales (11):
     Vancouver, Calgary, Edmonton, Winnipeg, London,
     Toronto, Montreal, Quebec, Moncton, Halifax and St John’s

International Business Development (11) :
     Brazil (2), China (2), Malaysia, Mexico (Mexico City and
     Monterrey), Poland, India (2) and Russia



                                                                 5
EDC CANADIAN BENEFITS POLICY


● EDC’s approach to Canadian benefits
   • the export of goods and services
   • Canadian foreign direct investment
   • dividends to Canadian companies
   • stream of future revenues under related contracts
   • research and development levels in Canada
   • world product mandates
   • follow-on opportunities for Canadian companies




                                                         6
                EDC OFFERINGS
● Account Receivable Insurance
      Credits insurance to exporters
      Protection against the non-payment of international buyers for a
      variety of commercial or political reasons
● Bonding Services
      Wide variety of instruments to support bid bonds, performance
      bonds and warranty bonds
● Financing
      Based on corporate risk, sovereign risk and project risk
      Pre-export financing for exporters
● Political Risk Insurance
      Private sector investments and loans
      Can be provided to equity investors and/or banks

                                                                      7
      Where are you selling?

  Emerging Markets-
        Mexico

● Know your potential buyers

● Basic credit information

● Buyer financing

  EDC – International Business
   Development Group (IBDG)




                                 8
                EDC Value Creation Process
                Business
                                               Transacting                  Post-sale
              Development

                                                             IBDG Value Creation
    IBDG Mission Critical Tasks
1. Origination of New Business             •    Early identification of new opportunities

2. Account Management of                   •    Leverage Relationships with our customer’s customers
   Foreign Buyers
                                           •    Value added local network

3. Transaction Facilitation                •    Market Knowledge + Sector Knowledge = success


4. Planning                                •    Strategic focus


5. Corporate Development                   •    Building the EDC brand locally
   Representation
                                           •    Focus on value added market knowledge
6. Market Intelligence


                                 Our network of Foreign Representations greatly enhance the
                                      ability of IBDG to create value for our customers.
                                                                                              9
KEY STRATEGIES – MEXICAN STRATEGIC
ACCOUNTS
      1.    STRENGTHEN THE RELATIONSHIP WITH MEXICAN
            STRATEGIC ACCOUNTS


                                         6)    COMISION FEDERAL
 1)        GRUPO MINERO                        DE ELECTRICIDAD
           [Extractive - Mining]               [Infrastructure – Power]
 2)        HYLSA S.A. DE C.V.            7)    MABE
           [Extractive - Steel]                [Light Manufacturing – Appliances]
 3)        PETROLEOS MEXICANOS           8)    METALSA
           [Extractive – Oil & Gas]            [Transportation – Automotive]
 4)        AMERICA MOVIL                 9)    NEMAK
           [ICT – Mobile]                      [Transportation – Automotive]
 5)        TELEFONOS DE MEXICO           10)   SCOTIABANK INVERLAT
           [ICT – Integrated Carriers]         [Financial Institution]




                                                                                    10
           Example of Credit Insurance

                      Claim
                                        Canadian
   EDC Credit
   Insurance
                                        Exporter

                Claim Payment
                     90%        Buyer non-payment, insolvency,
                                  Buyer contract cancellation,
EDC
                                     or political risk event
Recourse
                                    Foreign buyer
                                        Buyer

                                          CREDIT INSURANCE
                                     Commercial and political risks covered
                                     Increases export opportunities
                                     Enhances competitiveness
                                     Increases working capital
                                     Access to EDC world-wide credit networks
                                                                           11
  Example of Financing


                         Foreign Buyer
Loan Agreement               Buyer


                               goods &
                               services
  EDC
                            Canadian
                            Exporter


   Direct Disbursement                FINANCING
   to Exporters          To offer buyers a complete sales package
                         To meet foreign competition
                         To provide a cash sale for Exporter and
                          Repayment terms for buyer
                                                              12
                 EDC opening doors to Canadian Exporters
                               in Mexico


                             American
                              Movil                                           Nemak
                              $125                                             $15                 Controladora
                Galvak                             Controladora
                              million                                         million              MABE $22.5
 Telmex          $10                                MABE $20
                million
                                                                                                     million
  $400                                               million                                                         Daimler
                                        Cemex
 million
                                         $15                       Femsa Coca           Navistar                   Chrysler $200
                                        million                     Cola $25              $40                         million
                                                                     million             million



2001                      2002                    2003                 2004                2005             2006


                                                   Metalsa
      Nemak                                         $20
       $15                          Femsa          million                                                 Pemex $250
                           TFM
      million                       Empaq                                               Hylsa                million
                           $25                                           Galvak
                          million    ues                                                 $10
                                     $20                     Nemak        $10           million
                                    million                   $30        million
                                                             million




Key Business Development Initiatives                                                    *All values in USD



                                                                                                                          13
Direct Loans/Lines of Credit
             Mexico                      Mexico
             Telmex                    America Movil

          Line of Credit               Line of Credit
         USD 400,000,000              USD 250,000,000




 Recent Syndicated Loans
       Mexico                  Spain                      Mexico
       Telmex                Telefonica                 America Movil
    Mandated Lead
      Arranger                Arranger                    Arranger
   USD 150,000,000         USD 400,000,000             USD 175,000,000



                                                                         14
Example of Political Risk Insurance

                        Claim Payment
      Canadian
      Company                Claim                     EDC
                                                        EDC


                           Loss due
  Investment            To Political Risk

                                                       Recourse



        Foreign Buyer
                                 POLITICAL RISKS
                                 • Transfer & Inconvertibility
                                   Political Violence
                                   Expropriation
                                   Non - Honouring Sovereign
                                                                  15
      Example of Bonding Support

                            EDC Performance
                            Security Insurance
 Reimbursement                                   Recourse (5%)

                                                 Canadian
    Canadian                                     Exporter
      Bank                 Recourse
                            (95%)                 Commercial contract
Letter of                                         for sale of goods
Guarantee                                         and services ( say
( for 15% of                                      $10 million)
Contract or$1.5 million)
                                                 Foreign
              BONDING
                                                  Buyer
Frees up Exporter’s collateral
Recourse to Exporter
95% insurance to exporter for wrongful call


                                                                        16
                       EDC OFFERINGS

EDC Tools       - Support Through a Project Life Cycle
                           Development/          Production
       Exploration         Construction




   •PRI                 •Project Financing        •Lines of Credit
   •Credit Insurance    •Acquisition Financing    •Credit Insurance
                        •Bonding                  •Corporate Finance
                        •PRI (bank lenders)       •Procurement Advice
                        •Procurement Advice       •Environmental Advice
                        •Environmental Advice



                                                                          17
IBD VISION

                    Local SME’s


                       Mid Tier             Covered by IBD


                          61
   Emerging
    Markets   Intl’ Strategic Accounts



   Canada        Strategic Accounts
                                             Covered by Account
                          120                    Executives


                                             National Business
                      Mid Tier                 Development


                       SMALL             Small Business Development




                                                                  18
IBD VISION - MEXICO


                               Local SME’s


                                   Mid Tier                                IBD’s Strategy is to
                                                                          strengthen and grow
                                        10                                the foreign customer
                        Intl’ Strategic Accounts                                  base.
   MEXICO


  CANADA
                                     Alcan Inc.                               CANADIAN
                             Canpotex Limited Stelco
                           Inc. ATI Technologies, Mitel
                                                                               Strategic
                          Networks, Corporation,Nortel                         Accounts
                      Limited,Research in Motion Limited                       in Mexico
                 TransAlta Utilities Corporation, Husky Injection
              Molding Systems Ltd.,Bowater Incorporated, Catalyst
            Paper Corporation,GL&V Canada Inc.,Tolko Industries Ltd
            West Fraser Mills Ltd., Western Forest Products Inc., Pratt
            & Whitney Canada Corp., Standard Aero Limited, Wescast
                  Industries Inc,Woodbridge Foam Corporation



                                                                                                  19
SECTOR CAMPAIGNS
                                             Yes
                                                                            MEXICAN
                                                                           STRATEGIC
                                                    CLIENTS
                                                                           ACCOUNTS
                                                      130
                                                                              10
                             Existing
                              Clients
                                                    AVOID                QUALIFIED
                                                                         PROSPECTS



                                             No         Client Potential                       Yes




          ICT SECTOR                               TRANSPORTATION SECTOR                                    EXTRACTIVE SECTOR

 Onexa (Grupo Alfa), Flextronics, Siemens,          Grupo Cintra, Grupo Aeromexico, Mexicana         CEMEX, Grupo IMSA, DESC,Alpek, Altos Hornos de
  Grupo Posada, Grupo Televisa, Nextel,                de Aviacion, Daimler Chrysler, GM,                                      Peñ
                                                                                                             Mexico, Industria Peñoles Mittal
   MVS, Telefonica, Ericsson Telecom,                   Volkswagen, Nissan, Ford, Grupo                           Steel Lazaro Cardenas
        Biper, Grupo IUSACELL,                              Condumex, DESC, Grupo                              Industrias CH, Grupo Simec
               Axtel, Grupo                                     Indus Saltillo, San                             Deacero, DuPont, Holcim
                  Salinas                                        Luis Corporacion                                  Apasco, Mexichem,
                                                                                                                          Cydsa




                                                                                                                                       20
MARKET EVALUATION : STRUCTURE OF
IMPORTS
                                                                                                                             Total Imports (FOB): $221.3 billion

            Country                    Merchandise
                                       Imports USD                                                Mexico Imports by Country 2003-2005


                                                                                                            2003   2004   2005   Average
      1     United States              $118.7 (billion)
                                                                              $20
      2     China (Popular Republic)   17.7




                                                          Volume (millions)
      3     Japan                      13.0
                                                                              $10
      4     Germany                    8.7
      5     South Korea                6.5
                                                                               $-
      6     Canada                     6.2                                          Chin   Japa   Germany S. Korea Canada Brazil        Taiwan Malaysia Italy        USA
                                                                                     a       n
      7     Brazil                     5.2
      8
                                                                                            The United States accounts for 88% of all
            Nationalistic China        4.0
                                                                                            merchandise trade
            (Taiwan)
      9
                                                                                            Main imports consist of intermediate goods
            Malaysia                   3.6
                                                                                            (76%) and consumer goods (13%)
      10    Italy                      3.5                                                  Provided by EAF
           Source: INEGI 2005


______________________________
PRELIMINARY ASSESSMENT:
Structure of Imports


                                                                                                                                                                21
MARKET EVALUATION : STRUCTURE OF
IMPORTS

                                                Value                                           Value
              Top Imports from WORLD                        Top Imports from CANADA
                                                (billion)                                       (million)
              Electrical machinery and              $44.0   Vehicles other than railway or       $1,029.6
              equipment and parts thereof;                  tramway rolling stock

              Machinery and mechanical               33.8   Machinery and mechanical               $658.9
              appliances; parts thereof                     appliances; parts thereof

              Vehicles other than railway or         18.6   Electrical machinery and               $454.1
              tramway rolling stock                         equipment and parts thereof;
              Plastics and articles thereof          12.6   Meat and edible meat offal             $399.6
              Mineral fuels, mineral oils and         7.5   Oil seeds and oleaginous fruits        $358.4
              products of their distillation
                                                            Other commodities                    $2,426.4
              Other commodities                     $80.2
                                                                                     Source: COMTRADE 2004
              Source: COMTRADE 2004




                            Mexico’s top three imports from Canada match Mexico’s top three
                                                  imports from the world

______________________________
PRELIMINARY ASSESSMENT:
Structure of Imports


                                                                                                             22
MARKET EVALUATION : IMPORT FORECAST
    EDC Economics’ Trade Opportunity Matrix identifies the following as
    the top industries to watch in the Canada-Mexico export relationship:

           Actual Canadian                         Top Potential Markets
           Exports to Mexico                       for Mexico
     1     Agriculture, Forestry, Fishing     1    Industrial Chemicals                      The Trade
                                              2    Electrical & Electronic Products   Opportunities Matrix
     2     Motor Vehicles & Parts
                                              3
                                                                                        considers Mexican
                                                   Machinery & Equipment
     3     Food                                                                        import demand and
                                              4    Energy Mining
     4     Industrial Chemicals                                                           Canadian export
     5
                                              5    Paper & Products                   supply and capability
           Paper & Products
                                              6
                                                                                         to determine Top
     6     Machinery & Equipment                   Non-Ferrous Metals
                                                                                        Potential Markets.
     7                                        7    Plastic Products
           Electrical & Electronic Products
     8                                        8    Motor Vehicle & Parts
           Iron & Steel
     9     Non- Ferrous Metals                9    Food
     10                                       10   Rubber Products
           Non-Energy Mining
          Source: EDC TOM                          Source: EDC TOM


______________________________
PRELIMINARY ASSESSMENT:
Import Forecasts


                                                                                                        23
                                                                                                                                                           PRODUCT DISTRIBUTION
EDC BUSINESS METRICS                                                                                                                                                    2001-2006

                                          Mexico Volumes by Product

                  $3,000                                                                                                                       Mexico Transactions by Product
Business Volume




                  $2,500
                                                                                                                          700
                  $2,000
   (millions)




                                                                                                 Number of Transactions
                                                                                                                          600
                  $1,500                                                                                                  500
                  $1,000                                                                                                  400
                   $500                                                                                                   300

                      $-                                                                                                  200
                                 2001      2002      2003          2004      2005        2006
                                                                                                                          100
                                                            Year
                                                                   ST      CIB     FIN   PRI                                0
                                                                                                                                 2001             2002         2003          2004         2005
                                                                                                                                                               Year

                      Millions                                                                                                                                         ST      CIB       FIN         PRI
                                   2001      2002     2003          2004         2005    2006
                       CDN

                                                                                                                                 Number of       2001    2002         2003      2004
                                    538       556      523          584                                                                                                                    2005
                       STI                                                       575      548                                   Transactions


                      CIB                                                                                                          STI           453     457          534       509            415
                                    307       201      153           58           46      72
                                                                                                                                  CIB
                      FIN           791       455      783          282          356     1,047                                                    50      45           68           96         126

                                                                                                                                  FIN             83     102           84           76         56
                      PRI          1,072     1,068     996          986          704      956

                                                                                                                                  PRI             16      12           12           16         11
                      Total        2708      2280     2455          1910         1680    2624




                                                                                                                                                                                                           24
                                                                                                      LATIN AMERICA AT A GLANCE
EDC BUSINESS METRICS                                                                                                    2002-2006
            Latin America                                2002             2003               2004                 2005               2006
Business Volume                                    $6,446,473,238      $6,302,730,810    $6,215,911,520       $5,449,875,367     $7,359,083,570
Share of Markets Globally                             12.58%             12.13%              11.32%              9.49%              11.13%
Share of Developing Markets Volume                       65%              60%                 54%                 41%                48%
Transaction Count                                        3,120            3,152                     2,949                2,622        tbd

Customers Served                                         953              908                 945                  979                tbd

SME Count                                                663              658                 682                  717                tbd

SME Ratio                                                70%              72%                 72%                 73%                 tbd


                                                                    Latin America Volume
                                                                             by Region

                                                     8
                                                     7
                                                     6
                                       Volum ($)




                                                     5
                                            e




                                                     4
                                                     3
                                                     2
                                                     1
                                                     -
                                                             2002    2003         2004    2005         2006
                                                                                  Year
                                     Mexico                                         Andean Region
                                     Caribbean Region                               Brazil & The Southern Cone
                                     Central America
                                                                                                                                            25
                  THANK-YOU

International Business Development Group – Latin America

             Stephen Benoit, Senior Advisor
          Michel Villeneuve, Chief representative
             Terri Nizzola, Sector advisor ICT




                                                       26

				
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