Tied Loan

Tied Loan

A loan that a government makes to a foreign borrower in exchange for the promise that the borrower will use the loan to purchase goods from the lender's country. A tied loan may be mutually beneficial; for example, it may spur business in the lending country while aiding the borrower's economic development.
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References in periodicals archive ?
The YLP, YLP Preferential, and the SECURE loans are all untied loans while the STEP is a tied loan.
Yokohama shipyard under the Official Development Assistance project, via a tied loan extended by the Japan International Cooperation Agency.
The Higher Education Amendments of 1992 revised the Federal Stafford Loan program to remove restrictions that tied loan amounts to parental income.
But a tied loan would actually be worth less than its face value because of the effect of the excess cost of tying.
The project is being implemented as an Official Development Assistance (ODA) via a tied loan extended by the JICA.
South Korea is providing the loan for the project hence it is a tied loan that could only be participated in by Korean companies.
South Korean firms in joint venture with local companies can also tap Kexim's credit line through a tied loan facility, it said.
The ships will be acquired with official development support, through a tied loan extended by the Japan International Cooperation Agency.
The Cabinet Committee on Economic Affairs has approved the utilisation of Japanese assistance under the Japan International Cooperation Agency (JICA) through Special Terms for Economic Partnership (STEP) of Japanese official development assistance loans for the Delhi Mumbai Industrial Corridor (DMIC) project and the operational rules, terms and conditions of this tied loan facility.
And I hope we don't agree to bring in foreign governments and foreign workers (under ODA) with tied loans, in which they're the supplier and builder-except in exceptional cases.
The accusation arises from the IMF's "structural adjustment" programs of the 1980s and 1990s, which tied loans to strict budget regimes, and might have resulted in cuts to health spending.