Guarantees issued by UK Export Finance (UKEF) are allowing London-based consultancy Gleeds - working alongside partners Mace and Arup - to help Peru rebuild towns and villages after El Niño brought devastating floods to the country in 2017.
UKEF now builds on this success story by announcing a £1.75 million boost to the government-backed financing available for Gleeds' overseas projects.
Between December 2016 and May 2017, the El Niño Costero event brought intense rainfall to Northern Peru; this caused floods and landslides which devastated communities over an area four times as large as the UK, creating approximately £2.3 billion in damages.
The government of Peru called on international support for its rebuilding programme; with expertise in programme management and consultancy for construction projects, Gleeds wanted to support. It joined forces with firms Mace and Arup in 2020 to form the UK Delivery Team (UKDT), an official reconstruction partner to Authority for Reconstruction with Changes (ARCC), the Peruvian Government entity created to rebuild destroyed infrastructure.
When securing contracts as part of the joint venture, Gleeds had to provide a performance bond to assure the Peruvian government that it could deliver on its services, whilst also issuing a guarantee to obtain payments in advance.
Under its Bond Support Scheme, UKEF helped Gleeds to solve both challenges without restricting its working capital. In 2020, a UKEF guarantee to the firm's lending bank, Barclays Corporate Banking, allowed Gleeds to secure not only a performance bond unlocking contracts in Peru, but also the advance payments needed to deliver them.
Backed by UKEF, Gleeds has since been able to fulfil programme management contracts with its UKDT partners Mace and Arup, which have helped the Peruvian government rebuild vital infrastructure. Delivering workshops and courses alongside Mace and Arup, Gleeds has also helped Peru develop in-house expertise in planning and management for future construction projects.
Three years on, UKDT is helping to construct 18 healthcare facilities and 74 secondary schools, creating space for up to 115,000 students. To ensure that Peruvian communities are better protected against climate shocks, UKDT has also supported the construction of flood defences, including 150 kilometres of embankment, alterations to water-flow in 19 river basins and a network of national tsunami early-warning systems.
Since first helping Gleeds win contracts in Peru, UKEF has provided further support for the firm's overseas activities through its General Export Facility (GEF), allowing the firm greater access to bonds, guarantees and working capital from its bank, Barclays Corporate Banking. This boost for a British business is helping to grow the UK economy in line with the Prime Minister's priorities.
With a first, £4.25 million facility issued in 2021, UKEF has now expanded this support so that Gleeds can access up to £6 million through the GEF for its work on transformational projects both in Peru and around the world.
This announcement comes ahead of the COP 28 Summit being hosted by the United Arab Emirates from next month.
Countries - including the UK - will come together to discuss key issues like sustainable energy solutions to help offset the many negative effects of carbon emissions on our planet, including extreme weather conditions.
Tim Reid, CEO of UK Export Finance, said:
In supporting UK exporters, UK Export Finance is also able to support positive change around the world. Our backing for Gleeds in transferring skills, knowledge and expertise to overseas institutions is helping them to create lasting impacts for international prosperity and sustainability.
Building on our initial bond support in 2020, this most recent increase in our working capital support for Gleeds is good news as it sees us continue to help impactful UK services reach the world.
Graham Harle, Global CEO of Gleeds, said:
Thanks to UKEF's backing, Gleeds - alongside Mace and Arup - has been able to procure $3BN worth of contracts in two years and support ARCC in rebuilding Peru in a way that will benefit generations of Peruvians for centuries to come; with a focus on longevity, sustainability and user experience. The proactive and sustained transfer of knowledge from us to Peru's local, regional and national professionals is our legacy - and success in its own right.
The UKDT was invited to present the climate credentials of the programme in the UK Presidency Pavilion at COP26 and the average life cycle of a Peru construction project was 7-9 years; it's now down to 3 years. To quote our client ARCC: 'United we create the future'.
