4. A well-known school is planning to have a new campus in the New Capital. It invites construction companies to bid for the building of the new campus. Hassan Allam Holding is awarded the contract of building the new campus. Hassan Allam Holding decides that it needs to import specific construction equipmeny from abroad. So, after receiving the advance payment from the school, it contacts one of the suppliers in England to buy/ import the equipment. Yet, there are no established relationship between the construction company and the supplier.

A) After Hassan Allam Holding received the advance payment, what kind of instrument should be issued by the bank to ensure that the school will get back its advance payment in case something goes wrong? What is the instrument that would best secure the purchase of the construction equipment? Is it a funded or an unfunded instrument? Explain.

B) What kind of risk are both the importer/ issuing bank as well as the exporter/ beneficiary bank carrying under the import trade instrument of the construction equipment?

C) What is the bank instrument that would best cover Hassan Allam Holding contsruction performance risk under the contract?

D) What is the banking instrument that should be issued before the tender to ensure the school that each bidder would commit to the terms and conditions of their offer for the new campus?