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Expectedly, the first product of export credit insurance (ECI) provided by Bao Viet will be launched onto market in the 2nd quarter of 2010.

Nguyen Anh Duc, head of the risk fire insurance department under Bao Viet Insurance Corporation, sai ECI serves to mitigate some of risks associated with international trade. It generally covers commercial looses – insolvency of the buyer, bankruptcy or default and political losses. Depending on values of goods and payment forms, ECI products can be short or long-term ones.

Aside from its various benefits, ECI creates competition for exporters in actively offering credit for buyers, entering new export market confidently, raising capacity on credit loan approach. Besides, export credit agency (ECA) is also a market information provider, helping exporters enjoy safety and efficiency in business transactions.

Duc added ECI provision is relatively complicated, owing to assessment on solvency capacity and among others. Exporters can choose insurance products for package quota or concrete contracts, but financial capacity and solvency capacity of buyers and business environment are crucial elements for ECA to receive insurance or not. In addition, exporters must pay more charge of assessment for importers at 10-15% premium.

Reported by H.Phuc – Translated by A.C