How the Government enters into export credit insurance on private sector terms

By Giorgos Lampiris

An active role in the field of credit insurance for small and medium-sized export companies that do not have access to coverage from the insurance market is undertaken under private law terms by the Hellenic Export Credit Company (Export Credit Greece), which is an independent from the State and self-financed body, which according to its head, Grigoris Stamatopoulos. Within the scope of the responsibilities of the anonymous company which is an evolution of the former Export Credit Organization, it is to carry out mainly commercial activity – but also consulting – by selling contracts to private companies. Now, however, the role of the organization is being significantly expanded, with the aim of gaining flexibility, having the possibility of establishing subsidiaries in Greece and abroad, but also expanding the services provided. The interest of the venture is found in the intention of the Company to search for customers door-to-door (door-to-door), through consultants it will have in each region of the country. It is noted that Export Credit Greece is supported by the political leadership and the Deputy Minister of Foreign Affairs for Economic Diplomacy, Kostas Fragogianni, as well as by Enterprise Greece.

The first products will be available by the end of 2022 for sale through relevant contracts to exporting SMEs. A big bet for the new operator is to build a climate of trust towards its potential customers. We remind you that international players from the private sector such as Euler Hermes, Atradius and several others are active in the sector.

According to the managing director of the Company, Grigoris Stamatopoulos, there will be cooperation with the banks to provide financing, while in terms of the reserves available to the organization to support its activities, they come from its presence in the market for the previous 50 years as well as from the state’s guarantee. Provision is, among other things, to reduce the risk, to have reinsurance coverage from the private market, for reasons of coverage in the reinsurance sector. As far as abroad is concerned, the nature of the reinsurance is different, however it is also carried out in this case with private market criteria. It can also reinsure other export credit agencies, as is the case in Poland for the implementation of a project with Greek participation.

The main products available

The main products it has are credit insurance to the exporter (supplier’s Crecit Policy), credit insurance to the buyer (Buyer’s Crecit Policy), letters of Credit Confirmation, Political Risk Insurance (Politician Risk Insurance). These products are offered by all export credit agencies internationally. Surety Bonds, Working Capital Finance Guarantees, Financial Guarantees on Investments will also be provided. Among the provided tools – solutions for businesses are short-term credit insurance (Short Term Credit Policy), future factoring services and forfaiting services.

For its establishment, individual models were examined, where the model of the credit insurance bond of Italy (SACE) was selected. Thus, within the pandemic, the business model that led to the design of the Hellenic Export Credit Company was implemented and, in collaboration with Deloitte, the transition plan to this new business model was developed.

The anonymous company aims to cover products that will enable exports that will be ensured by a network of services provided. We will remind you that as an institution, the Credit Insurance Fund was founded in 1968, followed 20 years later by the Export Credit Insurance Organization and it took 34 years for the establishment of the Hellenic Export Credit Company today, which bears the international title Export Credit Greece.