VIII.  TRADE AND PROJECT FINANCING

- Description of Banking System

Credit-market institutions in Sweden fall into two main
categories, banking institutions and capital-market institutions.
Apart from the Central Bank, there are two main types of banks:
commercial banks and savings banks. After amendments to banking
legislation in 1969, the various types of banks are entitled to
operate in what are basically identical areas. In 1990, Sweden
opened its borders to foreign-owned banks but to date, these have
primarily concentrated on the business sector. For banking
operations, a charter ("oktroj") is necessary. Moreover, the
banks' activities are subject to close supervision by the Swedish
Finance Inspectorate (Finansinspektionen). The banking sector has
been rocked to its very foundations by developments in the recent
past. Deregulation of the sector, followed by sharply expanded
lending (especially for real estate acquisition) during a period
of overheating and rapid inflation in the second half of the
1980's, and the subsequent bursting of the bubble when real
estate prices collapsed toward the end of the decade, led to
substantial loan losses for the banks. As the bank crisis
accelerated, the government had to engage itself in a series of
ad hoc rescue efforts to guarantee the commitments of banks and
mortgage institutions toward their depositors and investors and a
special agency, the Bank Support Council, was set up to manage
the assistance program. A turn for the better has taken place
last year and this year but the Swedish banking sector has not
yet recovered completely. The largest banks are the state-owned
Nordbanken (the first bank to run into difficulty), Skandinaviska
Enskilda Banken, Svenska Handelsbanken (which did not need to
approach the authorities for help) and Swedbank (The Savings Bank
Foundations). The only American bank represented in Sweden is
Citibank.


- Foreign Exchange Controls Affecting Trading

Foreign exchange restrictions in Sweden were removed in 1991.
Commercial transactions are in general not subject to any
restrictions. There are no restrictions on remittances of
profits, or from investment liquidation proceeds. Royalty and
license fee payments may be freely transferred out of Sweden.
Moreover, yields on invested funds, such as dividends and
interest receipts, are usually freely transferred.


- General Financing Availability

Sweden does not offer special tax or other inducements to attract
foreign capital. Foreign-owned companies enjoy the same access as
Swedish-owned enterprises to the country's credit market and
government-sponsored incentives to business.


- How to finance exports/Methods of Payment

The Swedish Government provides basic export promotion support,
through its financing, jointly with Swedish industry, of the
Swedish Trade Council.

There are two general risks in the financing of foreign trade;
the credit risk and the foreign exchange risk but the latter can
be avoided by quoting sales in dollars only. Prepayment and
letters of credit involve the least risk for the exporter but is
not conducive to increased sales. After a relationship has been
established, U.S. exporters should be open to other trade credit
terms.


- Types of available export financing and insurance;
- Project financing available:

The Swedish Government and Swedish industry jointly finance the
Swedish Export Credit Corporation, which grants medium- and long-
term credits to finance exports of capital goods and large-scale
service projects.


- List of banks with correspondent U.S. banking arrangement:

Nordbanken AB                      Nordbanken U.S.
Smalandsgatan 17                   555 Theodore Fremd Avenue
S-105 71 Stockholm                 Suite B300
Tel: Int/46/8-614 7000             Rye, NY 10680
Fax: Int/46/8-200846               Tel: (914) 925-2344
                                   Fax: (914) 967-0519

Svenska Handelsbanken AB           Svenska Handelsbanken
Kungstradgardsgatan 2              599 Lexington Avenue
S-106 70 Stockholm                 New York, NY 10022
Tel: Int/46/8-701 1000             Tel: (212) 326-5100
Fax: Int/46/8-701 4835             Fax: (212) 326-5196


SE-Banken                          Scandinaviska Enskilda
                                   Banken
Kungstradgardsgatan 8              245 Park Avenue
S-106 40 Stockholm                 New York, NY 10167
Tel: Int/46/8-763 8000             Tel: (212) 286-0600
Fax: Int/46/8-763 7163             Fax: (212) 370-1709

Citibank                           Citibank
Box 1422                           399 Park Avenue
S-111 84 Stockholm                 New York, NY 10167
Tel. Int/46/8-723 3400             Tel. (212) 559-1394
Fax  Int/46/8-611 4843             Fax  (212) 759-3973