• 한국무역상무학회:학술대회논문집
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• 2006.06a
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• pp.45-72
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• 2006

The Equator Principles are a set of voluntary environmental and social guidelines for ethical project finance. These principles commit banks and other signatories to not finance projects that fail to meet these guidelines. The principles were conceived in 2002 on an initiative of the International Finance Corporation and launched in 2003. Since then, dozens of major banks have adopted the Principles, and with these banks among them accounting for more than three quarters of all project loan market volume the Principles have become the de facto standard for all banks and investors on how to deal with potential social and environmental effects of projects to be financed. While regarding the Principles an important initiative, NGOs have criticised the Principles for not producing real changes in financing activities and for allowing projects to go through that should have been screened out by the Principles, such as the Sakhalin-II oil and gas project in Russia. In early 2006, a process of revision of the principles was begun. The Equator Principles state that endorsing banks will only provide loans directly to projects under the following circumstances: - The risk of the project is categorized in accordance with internal guidelines based upon the environmental and social screening criteria of the International Finance Corporation (IFC). - For all medium or high risk projects (Category A and B projects), sponsors complete an Environmental Assessment, the preparation of which must meet certain requirements and satisfactorily address key environmental and social issues. - The Environmental Assessment report addresses baseline environmental and social conditions, requirements under host country laws and regulations, applicable international treaties and agreements, sustainable development and use of renewable natural resources, protection of human health, cultural properties, and biodiversity, including endangered species and sensitive ecosystems, use of dangerous substances, major hazards, occupational health and safety, fire prevention and life safety, socio-economic impacts, land acquisition and land use, involuntary resettlement, impacts on indigenous peoples and communities, cumulative impacts of existing projects, the proposed project, and anticipated future projects, participation of affected parties in the design, review and implementation of the project, consideration of feasible environmentally and socially preferable alternatives, efficient production, delivery and use of energy, pollution prevention and waste minimization, pollution controls (liquid effluents and air emissions) and solid and chemical waste management. - Based on the Environmental Assessment, Equator banks then make agreements with their clients on how they mitigate, monitor and manage those risks through an 'Environmental Management Plan'. Compliance with the plan is required in the covenant. If the borrower doesn't comply with the agreed terms, the bank will take corrective action, which if unsuccessful, could ultimately result in the bank canceling the loan and demanding immediate repayment. - For risky projects, the borrower consults with stakeholders (NGO's and project affected groups) and provides them with information on the risks of the project. - If necessary, an expert is consulted. The Principles only apply to projects over 50 million US dollars, which, according to the Equator Principles website, represent 97% of the total market. In early 2006, the financial institutions behind the Principles launched stakeholder consultations and negotiations aimed at revising the principles. The draft revised principles were met with criticism from NGO stakeholders, who in a joint position paper argued that the draft fails by ignoring the most serious critiques of the principles: a lack of consistent and rigorous implementation.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.2
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• pp.281-289
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• 2020

This research analyses the challenges facing SMEs in Oman in their quest for internationalization. The study is based on the OECD Model of Internationalization put forward in the report titled "How to Foster the Internationalization of SMEs through the Pacific Alliance Integration Process" which focuses on four factors namely finance, business environment, firm capabilities and market access, which are appropriate for an emerging economy like Oman. This study used a descriptive and quantitative research design in attempting to analyze the challenges being faced by Omani SMEs in their endeavors to internationalize. The research investigates causal relationship between variables using positivist and deductive approach. Data collected from 102 respondents was analysed by Structural Equation Modeling(SEM) using AMOS. It was found that finance availability was the most significant predictor of internationalization challenges followed by market access and business environment, while firm capabilities had no impact. Thus SMEs need easier access to credit and have to develop their international business networks and their marketing capabilities in order to grow internationally. Keeping in mind the contribution made by SMEs the government has to intervene by opening up easy lines of credit to SME exporters and allowing them relaxations in customs and other duties.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.11
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• pp.867-875
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• 2020

Quality internal audit (IA) plays a crucial role in accountability, transparency and preserving public properties. This paper gives a brief background of the IA system in Yemen and examines its impact with regards to financial performance in Yemeni commercial banks based on five factors: (i) independence of IAs, (ii) adherence to IA standards, (iii) governance principles implementation, (iv) size of the IA, and (v) frequency of internal audits committees' meetings. The primary data for the study were collected through a questionnaire prepared for this purpose. Fifty questionnaires were distributed out of which forty-two were retrieved and valid in the analysis process. For the empirical analysis, descriptive analysis and T-test were used for verification of the research hypotheses. Results revealed that sticking to standards internal audit, internal auditors' independence and quality governance have significant impact on banks' financial performance, while the size of internal audits committees, as well as their meeting, frequently has insignificant positive impact on banks' performance. Moreover, the country results show that the use of automated internal audit in banks has an impact on improving financial performance. This article provides avenues for further studies, mainly in developing countries, including Yemen, in quality internal audit and financial performance.

• International conference on construction engineering and project management
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• 2009.05a
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• pp.800-807
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• 2009

The limited public funds available for infrastructure projects have led governments to consider private entities' participation in long-term contracts for finance, construction, and operation of these projects to share risks and rewards between the public and the private. Because these projects have complicated risk evolutions, diverse contractual forms for each project member to hedge risks involved in a project are necessary. In light of this, Build-Operate-Transfer(BOT) model is considered as effective to accomplish Public Private Partnerships(PPPs) with a characteristic of an ownership-reversion. In BOT projects, the government has used such an incentive system as minimum revenue guarantee(MRG) agreement to attract the private's participation. Although this agreement turns out critical in success of BOT project, there still exist problematic issues in a financial feasibility analysis since the traditional capital budgeting theory, Net Present Value(NPV) analysis, has failed to evaluate the contingent characteristic of MRG agreement. The purpose of this research is to develop real option model based on option pricing theory so as to provide a theoretical framework in valuing MRG agreement in BOT projects. To understand the applicability of the model, the model is applied to the example of the BOT toll road project and the results are compared with that by NPV analysis. Finally, we found that the impact of the MRG agreement is significant on the project value. Hence, the real option model can help the government establish better BOT policies and the developer make appropriate bidding strategies.

• The Journal of Economics, Marketing and Management
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• v.2 no.4
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• pp.1-19
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• 2014

The rule of Islam is simple: if you advance a loan, you are entitled to receive your capital only and nothing more. If you wish to secure profit you should enter into a partnership and become a shareholder. Prohibitions against interest are not peculiar to Islam. If we were to trace back through history, a number of examples of such prohibitions can be found in the early Greek, Roman and Rabinnical thought. With the decline of the influence of the Catholic Church interest transactions become legal and stimulated giant Western corporations which forged capitalist imperialism. The practice of charging interest (usury) now dominated Western law and ethics for over a millennium. But, the Western or capitalist economic system has proven a failure in its quest for economic justice, which serves to benefit all in society, both the rich and the poor. In particular, capitalism is currently causing a terrifying scenario of making the rich richer and the poor poorer due to interest charges. An alternative banking model, called Islamic finance and banking, is evoked in this study in order to depress financial exploitation by banking institutions.

• KDI Journal of Economic Policy
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• v.30 no.2
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• pp.27-59
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• 2008

This paper empirically investigates the finance-growth linkage in Korea by utilizing firm-level data of manufacturing industries before and after the 1997 financial crisis. We find that, first, an increase in external finance is associated with a faster subsequent capital accumulation of firms. However, this capital accumulation channel became relatively attenuated after the crisis. Second, the total factor productivity growth effect of external finance has been considerably weak both before and after the crisis. Third, the information production and industry restructuring effects of external finance have also remained weak after the crisis. The limited role of external finance in post-crisis Korea partially reflects sluggish corporate investment and weakening dependence of good credit firms on external finance. The evidence suggests that, in order to effectively sustain economic growth, further reform efforts may be required to strengthen resource allocation and corporate restructuring roles of financial markets and institutions.

• The Journal of Asian Finance, Economics and Business
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• v.10 no.2
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• pp.29-39
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• 2023

The goal of this study is to understand how financial inclusion (FI) as influenced by Internet subscribers in India, affects India's Sustainable Development Goals (SDG). This study makes use of secondary data that was collected from 16 Indian states and one Union Territory between the fiscal years of 2018 and 2020. The goal of this study has been investigated using panel data regression analysis (PDR). And the study's findings indicate that wages received through MNREGA accounts and post office operating accounts under the supervision of Internet subscribers have a significant negative impact on India's SDGs, demonstrating how financial inclusion is harming the country's efforts to achieve sustainable development. This study suggests that it is important to pay attention to rural areas' access to the digital environment and their degree of digital literacy. These findings imply that improving the MGNREGA program and employees' pay might help the government alleviate poverty in India. Financial inclusion also depends heavily on financial literacy. The government should improve its digital infrastructure in rural and urban areas so that people there may better understand and utilize it given that it promotes financial inclusion, digitalization, economic advancement, rural development, and poverty reduction.

• The Journal of Asian Finance, Economics and Business
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• v.9 no.5
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• pp.377-388
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• 2022

The purpose of this article is to investigate the impact of competition on the performance of Indian banks. The survey includes banks from both the public and private sectors. The study will collect data for four years, from 2015 to 2019. Dynamic and static panel data are applied to estimate the association between competition and the bank's performance. Profitability and risk-taking are the performance measures used in the study. The study's main findings are that competition does not impact the banks' profitability in India. However, the findings concerning risk-taking are mixed. Therefore, it can be inferred that overall competition does not impact the banks' performance in India. Other measures of performance of the banks could have been used in the study. It is a limitation to use data of four years. Data for a much more extended period could have also been used. This is one of the few papers on the subject. Therefore, its contribution is very significant. The gap in studies on the topic of competition versus performance of the banks is veritably filled by the current study's findings.

• International conference on construction engineering and project management
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• 2009.05a
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• pp.962-969
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• 2009

The market of building construction has been competitive in Hong Kong, perhaps as anywhere else in the world. The barrier to entry is low because there are relatively low requirements on the three factors of production - technology, manpower and finance. The prevailing building technology is traditional and labour-intensive. There is also not much need of capital because clients' periodic payments have been the main source of project finance. Further, capitalizing on trade sub-contracting, contractors have been able to keep their direct labour-force small and to transfer much of their business risk to the sub-contractors. Based on interviews to solicit the perception of a sample of building contractors on the particular issues of construction finance, we present the findings in this paper and discuss the various implications. We believe that the current practice of construction financing is both the cause and effect of the competition within, and the competitiveness of, the building construction sector in Hong Kong. We conclude that the building construction sector is "locked or stuck" in this "equilibrium" of traditional technology, reliance on clients' finance and exploitation of sub-contracting. In this "equilibrium" state, there is hardly any motivation for contractors to engage themselves in product or process innovation. Consequently, any talk of industry reform or innovation could only remain just that. We believe that this problem is not unique in Hong Kong. The building construction sector in many other developed and developing economies is posed with similar if not the same problems and constraints. We conclude that there has to be some "external forces" to bring this "equilibrium" state to a higher level "equilibrium" one where higher value-added building construction services are supplied and demanded. This is a state where building contractors possessing innovative technology, better financial and manpower resources could thrive to build better buildings with innovative building methods and processes.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
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• v.39
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• pp.143-175
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• 2008

The documentary letter of credit is the most preferred and frequently used method in International Payment System in Korea, as it has less possibility of occurring credit risks in export than any other payment system. That's because the exporter can get payment from the issuing bank(confirming bank) by delivering the goods and presenting documents following the required procedure under the letter of credit, as the payment is affirmed by the issuing bank(including the confirming bank in case of the confirmed letter of credit) regardless of the buyer's payment. However, the pattern of payment methods used in international trade of Korea is changing dramatically like the importance of the credit is decreasing continuously among the payment methods while the remittance is increasing. The increase of remittance has a positive aspect that International Payment System are changing into those of advanced countries, but the decrease of the credit also has a negative aspect that the exporter might have a greater credit risks. Therefore, we need a systematic device to deal with this. Exporters in Korea usually have used the export credit insurance to deal with the credit risks However, the export credit insurance also have a limitation as the policy finance due to the limitation based on the credit status of the business and the limitation of acceptance from the lack of financial resources of the government, etc. Korea, which is the 11th export power in the world, has a basic limitation to deal with the credit risks by depending on the export credit insurance only. So, in this thesis, I have studied on the international factoring, forfaiting, which are advanced export finances and widely used in advanced countries, as substitutes to deal with the credit risks. the international factoring is an trade financing in which a factor offers full services such as credit cover, offering prepayment, collection, account receivables, management, etc, instead of the exporter on the account receivables occurred by the exporter's delivering goods to the importer. This international factoring has a high possibility of using as a means to deal with the credit risks, because it offers prepayment without recourse. the forfaiting is another export financing in which a forfaiter purchases the draft, the promissory note and other negotiable instruments issued from the international trade, with fixed interest rate without recourse from the exporter or previous holder. By using this method, they can avoid foreign exchange risks, contingency risks as well as credit risks, as the conveyances like the promissory note, etc are issued with the note warranty so-called 'per aval' in business practice. These trade financing are good substitutes to deal with the credit risks in export, but they are not widely used in Korea. Though it can be explained with various reasons, the common reasons are the lack of understanding on the use of advanced export finance, the lack of experts to manage the advanced trade finance, the conservative way of thinking of domestic organizations related to trade financing, the lack of organizations supporting the trade financing, etc.