Several countries in Asia have been busy boosting export credit insurance schemes to protect domestic exporters from buyer default risks and to help them cope with a tight credit market globally.
Last week, Singapore announced the new Export Coverage Scheme (ECS) which will start on 1 March and is expected to cover up to S$4 billion (US$2.7 billion) worth of trade involving about 1,000 Singapore-based exporters. Under the ECS, the government-run trade promotion agency, International Enterprise Singapore, will act as underwriter and by pooling insurers, increase the insurance coverage capacity for firms. There are for now four participating insurers - Atradius, Coface, Euler Hermes and QBE.
Explaining the need for the scheme, Singapore's trade minister, Lim Hng Kiang, said: "Demand for trade credit insurance is growing. Exporters are now more wary of buyers' credit risks and hence want to get coverage to protect against the risk of buyers default. But insurers have also become more selective. Furthermore the cost on insurance is rising."
Meanwhile, Thailand's Export-Import Bank plans to expand its export credit insurance scheme this year. Apichai Boontherawara, president of Exim Thailand, says that as the Finance Ministry plans to inject additional capital of 5 billion baht (US$142 million) into the bank, Exim is expected to be able to expand this business.
In Seoul, the Korea Export Insurance Corp says that it will increase export insurance by 4.5 trillion won (US$3.2 billion) to 6 trillion won this year. Qualified exporters will be able to get a 20% increase in export insurance, and the insurance ceiling will be lifted on firms whose debt ratio exceeds 650%.
Last week, Singapore announced the new Export Coverage Scheme (ECS) which will start on 1 March and is expected to cover up to S$4 billion (US$2.7 billion) worth of trade involving about 1,000 Singapore-based exporters. Under the ECS, the government-run trade promotion agency, International Enterprise Singapore, will act as underwriter and by pooling insurers, increase the insurance coverage capacity for firms. There are for now four participating insurers - Atradius, Coface, Euler Hermes and QBE.
Explaining the need for the scheme, Singapore's trade minister, Lim Hng Kiang, said: "Demand for trade credit insurance is growing. Exporters are now more wary of buyers' credit risks and hence want to get coverage to protect against the risk of buyers default. But insurers have also become more selective. Furthermore the cost on insurance is rising."
Meanwhile, Thailand's Export-Import Bank plans to expand its export credit insurance scheme this year. Apichai Boontherawara, president of Exim Thailand, says that as the Finance Ministry plans to inject additional capital of 5 billion baht (US$142 million) into the bank, Exim is expected to be able to expand this business.
In Seoul, the Korea Export Insurance Corp says that it will increase export insurance by 4.5 trillion won (US$3.2 billion) to 6 trillion won this year. Qualified exporters will be able to get a 20% increase in export insurance, and the insurance ceiling will be lifted on firms whose debt ratio exceeds 650%.
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