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BACK             Issue No. 4/2004
 Qualified credit insured exporters awarded by ECGA

 Total Credit Limits Issued by ECGA to Exporters increasing

 Africa-Middle East Regional Committee Meeting of the Credit alliance held in Istanbul, Turkey

 Country Profile of Buyers of Omani Insured Exports

 Questions & Answers

 Hint to Exporters

 Domestic Credit Insurance has attracted a Number of Policyholders

 The Omani Insured Exporter by ECGA

 Congratulatory Message


 
Qualified credit insured exporters awarded by ECGA
The Chairman of Export Credit Guarantee Agency (S.A.O.C) Sheikh Yaqoob bin Hamed Al Harthy presented Business Association Awards of ECGA to a number of Omani credit insured exporters during the occasion held on 18/9/04 at ECGA's Offices in CBD area. These special awards were conferred to a number of Omani exporters who have been associated and availed the export credit insurance services of the Agency for more than 10 years now. They have been active policyholders of the Export Credit Insurance Policy and managed the Policy very effectively through the years. The policyholders represent exporters producing and exporting variety of products which are credit insured by ECGA to many countries. The Agency conveys its congratulations for their outstanding achievements and recognition. The policyholders who have received the Award were as follows:



No.
Policyholder
Date of Issuance of Export Credit Policy
Products
Number of countries for insured products of Exporters by ECGA
1
National Aluminium Products Co. SAOG
01/11/1991
Aluminium Profiles
21
2
Amiantit Oman Company LLC
10/11/1991
PVC / PE Pipes
16
3
Oman Abrasives LLC
01/12/1991
Copper Grits
8
4
National Biscuit Industries Ltd. SAOG
01/01/1992
Biscuits
15
5
The National Detergent Co. SAOG
01/04/1992
Detergent Powder
13
6
Sadolin Paint (Oman) Ltd.
01/07/1992
Paints
10
7
Areej Vegetable Oils & Derivatives SAOG
01/08/1992
Cooking Oil
8
8
Reem Batteries & Power Appliances Co.
01/11/1992
Batteries
30
9
Oman National Dairy Products Co. Ltd. SAOG
01/06/1993
Dairy Products
34
10
Poly Products LLC
01/11/1993
Furniture
9
11
Ali & Abdul Karim Product Co.
01/06/1994
Ketchup
11




 


The Chairman presented the Award to the Representative of National Aluminum Products Co. SAOG, which was the first exporter availing ECGA's services



 
Total Credit Limits Issued by ECGA to Exporters increasing
Total credit limits issued by ECGA to exporters till end of six months of 2004 was RO164.5 million to 92 countries world-wide compared to RO150.2 million for corresponding period of 2003. Of the total credit limits issued, 73.7% were under letters of credit and 26.3% under open account. GCC countries constitute 57.4% of the total credit limits issued by the Agency. The period covered exports to 3440 buyers compared to 3220 buyers for corresponding six months period of 2003. It is worth mentioning that the Agency's Gross Premium Income increased by 58% that is from RO.122,000/- for the six months period of 2003 to RO.192,000/- for corresponding period of 2004.

 
Africa-Middle East Regional Committee Meeting of the Credit alliance held in Istanbul, Turkey
The Regional Committee Meeting for Africa/Middle-East Group of the Credit Alliance was held in Istanbul, Turkey on the 11th and 12th of October 2004 hosted by Coface subsidiary in Turkey. The meeting was attended by a number of ECAs as well as Regional Credit Information Agencies members of the Credit Alliance. These included ECGA of Oman, Egypt, South Africa, Turkey, Tunisia, Morocco, Jordan, Saudi Arabia, Iran, Cyprus, ICIEC (Islamic Corporation of Investment & Export Credit) and Coface. Mr. Nasir bin Issa Al-Ismaily, the General Manager of ECGA who is also the Regional Coordinator for Africa-Middle-East Group and member of the General Steering Committee attended and chaired the meeting. The meeting approved the minutes of the last meeting which took place in Paris earlier as well as reviewed the performance of the members in availing Coface services. The meeting also identified the obstacles to the development of credit insurance/credit management services in the Region. Other areas which were discussed were domestic on credit insurance, credit information on buyers, development on credit information bureaus as well as feedbacks and insights of the experiences of the entrepreneurs in the Region.


 
COUNTRY PROFILE OF BUYERS OF OMANI INSURED EXPORTS - IRAN

Kilometers. The capital is Tehran. The population of Iran as per the estimated statistics for 2003 is 69 million inhabitants.

Export Credit Guarantee Agency (SAOC) has insured Omani exports to various products to Iran. These include detergent products. Dairy products, chemical products, packaging materials, pipes & fittings batteries and polypropylene etc. The total credit limits issued by the Agency till August 2004 amounted to R.O.5,308,000/- to 44 buyers yet which are under letters of credit. The Agency has not paid any claims on buyers in Tehran.

During the year 2003, total on Omani exports to Iran were RO.165151744 million compared to RO.199947593 million for the year 2002, while the imports were 17576787 in 2003. The Omani exports and imports to Iran for the last 5 years are listed as below. Oman has maintained net trade surplus during the last 5 years.


 
1999
2000
2001
2002
2003

Exports

46159437

58453465

174884430

199947593

165151744

Imports

15218254

23411501

17748836

8644696

17576787

Surplus

30941183

35041964

157135594

191302897

147574957





As per the publication of International Trade Finance Magazine January 2004, Issue No. 441, in its survey highlights in Iran it states as follows:-

"One in four shipments is on open account, one in fours is paid for in advance, and half are covered by L/CS. Importers are a month late on average in depositing payments locally, with banks delaying exchange transfers and additional three months."

The usual minimum terms of payment are confirmed letters of credit between 60-120 days.
A number of ECAs provide short term cover for Iran including US Eximbank, Atradius, ECGD, Euler Hermes UK.ECGA of Oman has signed Cooperation Agreement with the Export Guarantee Fund of Iran (EGFI) in 23rd October 2002 promoting cooperation among the two organizations. EGFI of Iran as with ECGA of Oman are both members of the Credit Alliance Network under the auspices of Coface as well as active members of the Prague Club.
 
Questions and Answers


Q- How many countries world-wide does Oman exports and imports its goods during 2003?
A- The Sultanate, during the year 2003 exported and imported goods to 132 countries world-wide.

Q-What percentage of Oman's total non-oil exports and imports with the GCC countries during 2003?
A-
The GCC countries account for 45% of the total non-oil exports and 28% of imports. Among the GCC countries, the U.A.E accounted for 72.4% of total non-oil exports to the GCC and 77.6% of imports from GCC.


Q-What are the benefits to Oman exporters for availing ECGA's services?
A-
The benefits to Omani exporters for availing ECGA's services are several. These include mitigation of credit risk because of inability of the buyer to pay due to protracted default, bankruptcy or non acceptance of the goods that is commercial risks non- commercial or political risk events which hamper such payments. Moreover, by availing such credit insurance protection, the exporters liquidity position can be improved by discounting their its export bills under the Agency's post shipment financing scheme. Furthermore, the credit insured exporters can also be eligible for working capital financing of their exports orders under ECGA's pre-shipment export credit guarantee scheme arranged with the commercial banks.

Q-How many claims were indemnified by ECGA to exporters and what it the distribution of claims paid on buyers to different countries?
A-
ECGA has indemnified a total of 28 claims of total amount of over RO.420000 to credit insured exporters to 11 countries world-wide. The number of buyers for which the claims were paid and percentages of the claim amount are listed as follows:


No.
Country
Number of Buyers For
which claims were paid by ECGA to exporters
% of total
claim paid
1
Saudi Arabia
5
67.3
2
UAE
10
11.9
3
Kuwait
2
4.4
4
UK
1
3..5
5
The Netherlands
1
29
6
Jordan
2
2.8
7
USA
2
2.7
8
France
2
2.0
9
Qatar
1
1.4
10
India
1
0.8
11
Italy
1
0.3
Total
28
100.0%
The neighbouring GCC countries constitutes 85% of total indemnified claims by the Agency to the exporters.

Q-What action as policyholder should take when recoveries are received from buyer?
A-
All proceeds of recovery action must be remitted in full promptly to ECGA for allocation. It will then allocate them in the proportion in which the original loss was shared between the exporter and ECGA.


Q-Does ECGA contribute to recovery costs?
A-
Yes. Where action is taken to recover the debt in accordance with its requirement, it will be prepared to reimburse the legal fees paid to lawyers in the buyer’s country up to the proportion in which liability for the debt has been admitted by ECGA.
 
Hint to Exporter

 Whatever you trade, you want to be paid and in an uncertain world, you need financial protection. A credit insurance policy of ECGA could be the answer. Wherever you trade, ECGA's policies cover against the damaging consequences of unpaid domestic and overseas debt and customer insolvency, as well as events caused by non-commercial risks.


 If your customer can't pay ECGA will. Commercial risks are innumerable. Sometimes the slightest event can result in non-payment. It's vital that you protect your turnover. Credit insurance from ECGA offers you protection you need.

 
THE OMANI INSURED EXPORTER BY ECGA
GULF ACRYLIC INDUSTRIES LLC
M/s. Gulf Acrylic Industries LLC is a joint venture manufacturing company established in 1996. Its shareholders are from among the top ten business groups in the Sultanate. It is based in the Sohar Industrial Estate and manufactures acrylic, high impact acrylic, SAN, poly carbonate, poly styrene and ABS sheets. The company is highly export oriented with exports contributing to 90% of its sales. It exports to the GCC countries, Europe, Africa and other countries. The company has achieved a robust growth in sales volume over the last two years on account of high quality standards and product innovation backed with strong customer support. It has strong focus on advanced testing systems and stringent quality control to maintain the superior quality of its product range which include Poly Vnyl Chloride Sheets (PVC), Poly Carbonate Sheets (PC) & Poly Methyl Methacrylate Sheets (PMMA).

 
 


 
CONGRATULATORY MESSAGE
The Omani exporters have long recognized and appreciated that one of the major keys to success is to insure with ECGA for safe export business. The Agency provides confidence, encouragement and incentive in support of its services to exporters for more than ten years.


ECGA is here to help you minimize your risks

BUYER’S RISK
COUNTRY RISK
   buyer’s insolvency/bankruptcy

   buyer’s failure to pay

   buyer refusing delivery of goods


   foreign exchange transfer delay

   import bans or cancellation of import licence

   payment moratorium

   war, civil disorder, natural disasters

Other benefits of service provided to credit insured exporters include domestic credit insurance, post shipment financing through bills discounting by commercial banks as well as issuance of guarantees to commercial banks for pre-shipment financing needs of the exporters.
   
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