| Issue No. 4/2006
In this fourth quarterly issue of ECGA's News Bulletin, it provides the coverage on the meeting of the Prague Club of the Berne Union that is International Union of Credit & Investment Insurers in Muscat, which was hosted by the Export Credit Guarantee Agency (ECGA) of Oman in coordination with the Secretariat of the Berne Union. It was highly successful gathering. This is unique as it was first Prague Club meeting held in the Arab and Middle-East Region. It is worth mentioning that ECGA of Oman was the first ECA from the Region to qualify for membership of the Prague Club. The meeting in Muscat was represented by ECAs from 30 countries in addition to invited external speakers under the auspices of the Berne Union. An article entitled "ECGA's valuable experiences as member of the Prague Club" discusses the background of the Agency's involvement and its membership of the Club as well as the benefits it derives from such association through the years.
Among other important events In the News, is the remarkable growth of domestic credit insurance offered by ECGA to Omani exporters as they have also realized the need to mitigate credit risks from domestic buyers, coupled with the export credit insurance. The cover for domestic business provides necessary protection against the risks of non payment from local buyers due to protracted default and insolvency.
Under Hints to Exporters, the Agency highlights the importance of good credit management which ensures the success of the business as well as minimization of the risks through credit insurance. The Agency sheds insights of the Do's and Don'ts for its credit insured exporters as required under the Export Credit Policy which include the importance of prompt submissions of business declaration so as to ensure that the suppliers export shipments are on cover. Thus export shipments should be declared to Agency timely so as to guard the interest of the exporters in meeting the necessary obligations and conditions as stipulated in the Policy for credit cover.
Under the Country Profile of Buyers of Omani Insured Exports, the level of exports and imports between Oman and Taiwan for the last 5 years is revealed and the extent of ECGA's credit insurance to Omani exporters to that country. It is interesting to note that during the last two years that is 2004 and 2005, the level of the Omani exports to Taiwan exceeded imports from that country thus enjoying trade surplus.
In our Q&A forum, it addresses a variety of questions and answers on credit insurance, underwriting, claims, recoveries, and export financing areas. The importance of timely declaration of exports to ECGA is also raised so as to manage the policy effectively.
As per the section on the Omani Insured Exporter by ECGA, the Bulletin provides profile of National Heaters Industries Co. LLC as one of the Omani non-oil exporters that has experienced successful growth of exports through its high quality electric water heaters to customers world-wide.
As always, ECGA is encouraged by constructive comments from of our credit insured exporters and others who felt that the ECGA News Bulletin provides timely, relevant, thought provoking and beneficial infromation to them.
Nasir bin Issa Al-Ismaily
Prague Club meeting held in Muscat
In the News
- Country Profile of Omani Insured Exports
- Hints to Exporters
- Questions & Answers
- Omani Insured Exporter by ECGA
National Heaters Industries Co. LLC
3. H E the Chairman of ECGA welcomed participants at fromal reception
The Chairman of the Export Credit Guarantee Agency (S.A.O.C) His Excellency Sheikh Yaqoob bin Hamed Al-Harthy welcomed the participants of the Prague Club meeting of the Berne Union at the reception function held at the Grand Hyatt Hotel in Muscat on December 5, 2006. Among the guests attended the function included the Secretary General of the Berne Union Ms. Kimberly Wiehl and the Chairperson of the Prague Club Ms. Vida Zabukovec. Other guests and participants who attended the function included delegates of ECAs from Bosnia & Herzegovina, Botswana, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Iran, Jordan, Kazakhstan, Macedonia, Philippines, Poland, Romania, Saudi Arabia, Serbia, Slovak Republic, Slovenia, South Africa, Thailand, Uzbekistan and Multilateral ECAs included Africa Trade Insurance Company based in Nairobi, Kenya, Inter-Arab Investment Corporation in Kuwait and Islamic Corporation of Investment and Export Credit based in Jeddah as well as other invited external speakers
|Participants of the Prague Club Meeting of the Berne Union
on Dec.4th to 6th Muscat, Oman
|| 4. ECGA Signs Cooperation Agreement with UZBEKINVEST
Export Credit Guarantee Agency SAOC, of the Sultanate of Oman signed Memorandum of Understanding (MOU) with the National Export-Import Insurance Company of Uzbekistan (UZBEKINVEST) in Muscat, Oman 8th December 2006. The Memorandum included various areas of cooperation towards its activities and services such as exchanges of infromation of buyers and banks, assistance in recoveries, exchanges of experiences and claim payments, training etc.
The UZBEKINVEST of Uzbekistan as with ECGA of Oman are both members of the Prague Club.
5. Botswana Export Credit Insurance officials visited to ECGA
Two officials from the Botswana Export Credit Insurance Agency – Mrs. Pauline Sebina the General Manager and Mr. Bonani Dube the Marketing Manager visited ECGA's offices on December 7th for familiarization of the Agency's operations. Both ECGA of Oman and BECI of Botswana are members of the Prague Club and the officials from Botswana attended the Muscat meeting of the Prague Club.
6. ECGA officers attended Training Program in Export-Import Bank of Thailand
Two of the Agency’s officers i.e. Mr. Saif bin Nasir Al-Mahdi, Underwriting Officer and Mr. Ahmed bin Khalfan Al Baloushi, Senior Underwriting Officer have attended a Training Program in Export-Import Bank of Thailand during the period from 24 to 27 July 2006. The main objective of the training program is to share the experience of Exim Bank of Thailand and ECGA in export credit insurance field. Topics covered included underwriting, claims, recoveries and reinsurance.
7. Familiarization visit of officials from National Agency for Insurance & Finance of Exports of Sudan to ECGA
Two officials from the National Agency for Insurance & Finance of Export of Sudan visited ECGA from the 7th till 9th October for familiarization program on ECGA's activities. They were Dr. Mohamed Yousuf Ali – the General Manager and Mr. El Rasheed Abdulrahman Ali - Manager of Export Credit Insurance Dept. The officials were provided with the presentation of various services offered by ECGA to Omani exporters which included export and domestic credit insurances, post-shipment financing through bills discounting with commercial banks, pre-shipment financing, marketing etc. The officials were also demonstrated with the ECGA's computerized system which included generation of various reports needed, buyers infromation files, underwriting, claims and recoveries as well as risks monitoring of buyers. National Agency for Insurance & Finance of Export of Sudan (NIFES) commenced its operations in January 2006, it is a government owned entity.
Higher growth of the Domestic Credit Insurance
Domestic Credit Insurance Services has attracted a growing number of Omani exporters since it was introduced in September 2003. ECGA has issued with total credit limits of RO.5.2 million on 122 buyers till end of September 2006. The total business declared for domestic credit insurance for the nine months period of 2006 has increased to RO.5.72 million compared to RO.4.17 million for corresponding period of 2005. The Gross Premium Income for domestic business has grown up by 40%
Oman & US signed the Free Trade Agreement
The Sultanate of Oman signed Free Trade Agreement with the USA. Oman is the second GCC member country to sign the FTA with the USA after Bahrain. With the signing of the agreement, it would allow more exports from Oman to the USA which is a major market for several products in the world as duties on almost all industrial and consumer products will be immediately exempted in addition to many other benefits to be derived from it. It is worth mentioning that the Export Credit Guarantee Agency SAOC has insured exports of various Omani products to the U.S market including such products as garments, fish, aluminium profiles, marbles, polypropylene products, flexible packaging materials, sewing threads, biscuits etc. Total credit limits approved amounted to RO.10.5 million. In 2005 total Omani non-oil exports to USA were RO.19.1 million while imports were RO.208.8 million.
Total Omani export and imports to the U.S.A during the last 5 years are shown below:-
|Figures in RO.
COUNTRY PROFILE OF BUYERS OF OMANI INSURED EXPORTS TAIWAN
TAIWAN is an island situated in Eastern Asia. The total area of the country is 35,980 square kilometers. The capital city is Taipei. The population of Taiwan is 23,036,087 (July 2006 Est.)
Export Credit Guarantee Agency (SAOC) has insured Omani exports to various products to Taiwan including perfumes, dairy products, fish and marine products, biscuits and chocolate coated products, garments, marble tiles, etc. The total credit limits issued by the Agency to date amounted to RO.619,316/- of which RO.571,816/- or almost 92% under letters of credit and remaining 8% RO.47,500/- are on Open Credit. The Agency has not paid any claims to insured Omani exporters to Taiwan yet.
.During the year 2005, total Omani exports (excluding oil) to Taiwan were RO.11,010,703/-, while imports were RO.6,470,453/-. The Omani exports and imports to Taiwan for the last 5 years are listed below. Thus Oman has recorded substantial a net trade surplus with Taiwan during two years 2004 and 2005.
(All figures in RO.)
Source: Extracted from Foreign Trade Statistics
As per the latest publication of International Trade Finance Magazine February 2006, issue No. 485, in its survey highlights in Taiwan it states as follows:-
“Out of three shipments are on open account; one in three covered with an L/C. importers deposit local currency payments within two weeks of due date. Banks transfer foreign exchange in three months”.
As per D&B COUNTRY RISK INDICATOR, for the month of March 2005 a number of ECAs provide full cover for Taiwan including US Eximbank, Atradius, ECGD and Euler Hermes - UK.
The maximum terms of payment are SD and Open Account with usual terms of 30 -60 days.
HINTS TO EXPORTER
•Good credit management is knowing the customer, assessing the risk the investment in that customer represents, and keeping control-from opening the account to getting paid. Put simply, good credit management improves the cash flow of your business reduces your dependence on lending and produces the foundation for expansion, improved competitive advantage and sustainable profits.
•For all businesses, extending credit to customers involves a certain amount of risk. You can, however, minimize this risk by insuring yourself against the possible default and insolvency of your customers.
•Trade Credit Insurance can be an important tool in credit management and can help to minimize the risk of potential problems with late payment and bad debts. It can also provide much needed replacement working capital when your customers fail to pay within the agreed credit period.
QUESTIONS & ANSWERS
Q. Why exporters sometimes do not get larger credit limits on certain buyers or ECGA refuses or reduces cover on a buyer?
A. ECGA may restrict or refuse cover on certain buyers for various reasons. For example, it could happen if the buyer is not sufficiently credit worthy based on their financial standing or if his total commitment with other suppliers are already too high in relation to its size and financial capability or we may have recorded or received adverse payment experience or disputes with those buyers. Thus ECGA is of the view that such restriction of cover on buyers will safeguard the interest of the exporters against possible losses.
However, ECGA always try to decide on cover as objectively and pragmatically as we can in order to promote and enhance Omani exports while evaluating the risks on buyers.
Q. Do I have to declare to ECGA when the total outstanding on the buyer exceeds the credit limit approved? If so why?
A. Yes, you must. The rationale is that the "excess" outstanding will automatically come under ECGA cover once previous shipments are paid for: This fits in with the revolving nature of your credit limit. If the "excess" shipments were not declared and the buyer subsequently runs into a liquidity problem, ECGA could technically refuse to cover those "excess" shipments which were not declared.
Q. What should I do when a buyer asks for a change in payment terms or an extension of the payment due date?
A. You should immediately seek ECGA's consent because you require prior written approval before agreeing to any change in the payment terms or extension of credit period.
Q. How can I make use of my insurance policy to get export financing?
A. You can arrange a letter of Authority (L/A) which is a written authorization initiated by you containing the written consent of your banker, requesting us to directly pay the nominated bank all claims which may become payable under your policy.
Q. What is credit risk and why it is necessary to insure with ECGA?
A. It is the risk that the insured will not be able to recover all or part of receivables against trade transactions due to the occurrence of a cause of loss. Therefore, it is necessary to mitigate such risks through credit insurance services against both commercial and non-commercial risks.
Omani Insured Exporter by ECGA
NATIONAL HEATERS INDUSTRIES CO. LLC
M/s. National Heaters Industries Co. LLC has been availing ECGA's export credit insurance services since its inception in 1991 very effectively. ECGA had approved credit limits amounting to RO.3.3 million on various buyers located in 9 countries including all GCC countries.
Established in 1983, taken over by Omzest Group in 1988, National Heaters Industries Co. LLC continues to be a classic Omani success story and is a Company growing from strength to strength.
The Company’s “HOTEX” electric water heaters enjoy the reputation of trendsetter and Industry leader. Innovation, best technology, high quality and excellent customer service are the key drivers of the company.
National Heaters is recognized as one of the technically top companies in the GCC and is the leading brand of water heater sold in all 6 GCC states. Today HOTEX is considered as a standard for design and manufacture of water heaters in the region.
In export, the company sells Hotex G.I., Copper and Glass-lined heaters through established distributors, dealers. The company identified the need for an economy brand for the price sensitive and highly competitive export markets. National Heaters introduced Sunex brand exclusively for exports. Sunex is considered as the best brand in that price segment. 60% of production is exported to GCC, Yemen, Tanzania, Jordan and Sri Lanka. The Company makes constant investments in exploring new export markets.
The company launched its advanced technology Coolex range of products water purifiers, air purifiers and thermoelectric refrigerators and water coolers. These products sold through leading hypermarkets in Oman with excellent export potential. The company has already launched these products in Saudi Arabia, Yemen & Sri Lanka.
NATIONAL HEATERS INDUSTRIES PRODUCTS
EXPORT CREDIT GUARANTEE AGENCY (S.A.O.C.)
DO's & DONT'S
As credit insured exporter should declare all shipments to ECGA made during the previous month on or before the tenth day of each month
Delay in submitting monthly declaration to ECGA. This despite several written reminders from the Agency
continue vigorous recovery action prior and after payment of your claim as agreed with ECGA.
|Write off any amount of overdue debt without written consent from ECGA
Take all possible steps to minimize or prevent the loss and infrom ECGA accordingly.
|Effect further shipments while previous export bills are overdue to the buyer.
complete your claim from in full and send all relevant documentation with your from
hang on to any sum recovered-where a claim has been paid most of it belongs to ECGA
As credit insured exporter you need, infrom the Agency all amounts which at the end of previous month remain unpaid for more than two months from the original due date.
|Agree to postponement of extension of further period for payment by the buyer without consulting with ECGA .
The Export Credit Guarantee Agency of the Sultanate of Oman is honoured for hosting the meeting of the Prague Club members of the Berne Union which is the International Union of Credit & Investment Insurers in Muscat from 4th till 6th December 2006. ECGA would like to share some of the extracted complimentary messages received from the participants of the Prague Club of the Berne Union in Muscat
"Thank you and your team once again for perfect organization of the meeting, excellent and kind hospitality and memorable social program. I was very much impressed by Oman and very honoured that I could chair the meeting of the Prague Club in Muscat"
Vida Zabukovec – Chairperson of the Prague Club
"The meeting was very successful and well organized. I very much enjoyed my stay in Oman and Gala dinner was fabulous. I was impressed with ECGA's operation and the level of professionalism. I do hope that the meeting will contribute to your endeavours to increase the awareness of credit insurance in your country."
Head sales - The Inter-Arab Investment Guarantee Corp.
"I wish to sincerely thank you for your kindness in hosting us at your office after a very busy 3 days of the conference. In addition to the Prague Club, our visit to ECGA was really workable"
Poiline Sebina - General Manager
Botswana Export Credit Insurance Corporation.
"We are impressed by the outstanding hospitality we have received from ECGA at the meeting in Muscat. It was our first time to your beautiful country and hope it is not the last. I am sure we all have had a both professional and personal benefit from it. I would like to thank sincerely, to all colleagues in the ECGA who helped us from the preparation stage of our travel until we left. I would like to repeat my best wishes for future cooperation between our constitutions."
Marija Tanasoska - Chief of Insurance Department
Macedonian Bank for Development Promotion
"We would like to thank you and the whole staff of ECGA for your unique arrangement and wonderful management in arranging the Muscat meeting for the Prague Club which was useful for us."
Sayed kamal Sayed Ali, Chairman & President
Haideh Youness – Underwriting Deputy
Bijan Solemanzaleh- International Affairs Manager
Export Guarantee Fund of Iran
"Please accept once again our sincere congratulations and appreciation for excellent organization of the held Prague Club meeting in Muscat and kind hospitality. Our visit was really interesting and memorable."
Shavkat Inamov -First Deputy Director General
"Thank you very much. It was really a very nice meeting and organization. We thank you for your kind hospitality."
Khamis El-Gazzah - Underwriting Manager
Islamic Corporation of Investment & Export Credit
"Thank you once again for a memorable event in your beautiful country Oman. We had a great time there and I wanted to thank you and your colleagues for all the hard work you did for us."
Jako Kruuse - Head of Export and Enterprise Division
Kredex – Estonia
"I am most grateful for the kind hospitality to us during the Prague Club Meeting in Oman. It is an interesting country. If I had a chance, I will ride the came in Oman!"
Suchada Akkasatavorn - Senior Officer
Prague Club meeting held in Muscat
ECGA's valuable experiences as member of the Prague Club
The second bi-annual meeting of the Prague Club was held in Muscat from 4th to 6th December 2006 hosted by the Export Credit Guarantee Agency of the Sultanate of Oman in coordination with the Secretariat of the Berne Union which is International Union of Credit & Investment Insurers. In the following article, Mr. Nasir bin Issa Al-Ismaily the General Manager of ECGA who is also a member of the Working Group of the Prague Club discusses the background of the Agency's involvement and membership with the Prague Club as well as the benefits it derives from such association.
Before the Export Credit Guarantee Agency (ECGA) became a member of the Prague Club, it was invited by the Secretariat of the Berne Union to attend as an Observer in its first meeting six years ago that was in May 2000 in Tashkent, Uzbekistan. At that meeting, most of the qualified members of the emerging markets were Export Credit Agencies (ECAs) from Central and Eastern European countries.
A year later in May 2001, ECGA qualified as a full member of the Prague Club and it was the first ECA in the Africa-Middle/East Region to be admitted as member. Other ECAs members were from the Asian countries such as Thailand and Phillipines. Subsequently, the Prague Club expanded and admitted increasing number of members from Africa/Middle-East Region that is from such countries as Saudi Arabia, Iran, Jordan, Egypt, South Africa and most recently Botswana. In addition to national ECAs from the Region, other regional multilateral ECAs also joined the Prague Club that included Inter-Arab Investment Guarantee Corporation (IAIGC), Islamic Corporation of Investment and Export Credit (ICIEC) as well as newly established African Trade Insurance Agency. The list of ECAs members of the Prague Club are now 30 countries as shown below:
PRAGUE CLUB MEMBERS & COUNTRIES
||ATI – AFRICA TRADE INSURANCE
IGA - BOSNIA & HERZEGOVINA
||BAEZ – BULGARIA
||JLGC - JORDAN
||BECI - BOTSWANA
||KECIC – KAZAKHASTAN
||EGAP - CZECH REPUBLIC
||KREDEX – ESTONIA
||ECGA-SULTANATE OF OMAN
||ECGC - ZIMBABWE
||LEI - LITHUANIA
||ECGE - EGYPT
||MDPB - MACEDONIA
||ECIC -SOUTH AFRICA
||MEHIB – HUNGARY
||EXIMGARANT - BELARUS
||PHILEXIM - PHILIPPINES
||SEC – SLOVENIA
||EGFI - IRAN
||SEP - SAUDI ARABIA
||SMECA – SERBIA
||HBOR - CROATIA
||SLOVAK EXIM-SLOVAK REPUBLIC
||IAIGC - KUWAIT
||tru - Iceland
||ICIEC - SAUDI ARABIA
||UZBEKINVEST - UZBEKISTAN
Historically, the Prague Club originated in the early 1990s as an initiative from the Berne Union and European Bank for Reconstruction and Development (EBRD) to establish meeting facilities with four embryonic export credit agencies (ECAs) in Central and Eastern Europe. These ECAs were from Czech Republic, Hungary, Poland and Slovenia. The meeting of the four agencies were held in Prague in May 1993, where they signed a declaration committing them to observe the Berne Union General Understandings in their business. The Berne Union Secretariat co-ordinates the work of the Prague Club members. The aim was to help the ECAs of developing countries to learn all about the export credit business from the existing Berne Union members. It is interesting to note that ECGA of Oman started its export credit insurance operations way back in November 1991 at the same development phase where other emerging ECAs from Central and Eastern Europe commenced their operations.
As the number of new agencies began to grow rapidly, and new agencies from Asia and Africa were invited to join their Eastern and Central European peers, the organizational framework was established in 2000, when it was given the name Prague Club in recognition of its first meeting held in Prague in Czech Republic. Rules and Regulations were then approved. The organization's primary objective as envisaged was to support members and observers – those who have yet to write any credit insurance business - in developing their export credit and investment scheme and facilities, primarily through technical discussions provided at the Club's twice-yearly meetings at venues held in member countries.
The purpose the Prague Club was to work for the international acceptance of sound principles of export credit insurance and the establishment and maintenance of discipline in the terms of credit for international trade maintenance and sound principles of foreign investment insurance. Also for encouragement of a favourable investment climate, by co-operating in efforts to provide investment insurance for the benefit of investors and host countries as well as provide for the exchanges of infromation, assistance, expertise and advice in relation both to the commercial and political risks involved in export credit insurance, as well as investment insurance and to the range of associated matters relating thereto. The participating ECAs are required to observe the Berne Union Understandings and Agreements and report any deviations from them.
Membership of the Prague Club is restricted to organizations engaged in insuring or guaranteeing export credit transactions and in underwriting political risks in a significant way in such transactions and/or the insurance of outward investments or organizations not yet legally established but in the stage of development to become ECAs.
Prague Club has proved a striking success. Members regularly participate in its meetings, and so far their experiences have been very positive. They have gained a lot from shared experiences from other ECAs that are members of the Club to practical problems that have evolved during the underwriting processes
According to Berne Union Yearbook 2006 publication, the business volume of Prague Club members increased significantly from just $468 million in 1994 to nearly $13 billion ten years later. The Group has become a self-sustaining entity.
Members within the Club are constantly looking to grow their business. Those members that underwrite the largest business volumes eventually seek and gain membership to the Berne Union which still maintaining their status as active members of the Prague Club.
Although the Prague Club and Berne Union are separate associations, the links are plentiful, especially as they share the same Secretariat support. Representatives from Berne Union Members are invited to Prague Club meetings as speakers, and to conduct workshops and seminars, while reciprocal invitations are extended to Prague Club members for seminars and workshops hosted by the Union and its members. The activities of the Prague Club are managed by the Berne Union Secretariat and follow very closely the structure and fromat of the Berne Union meetings.
The level of expertise within the Club is increasing very rapidly. Adding to the expertise levels of invited speakers during Prague Club meetings include such international organizations as the OECD, IMF the World Bank, MIGA and EBRD for which the Berne Union maintains relationship with them. All of which have contributed regularly in the promotion of the credit insurance best practices.
Spread over two full days of meeting and one day of workshop, the Prague Club meetings in Muscat as in previous other meetings in other venues, focused heavily on tackling range of technical and underwriting questions that arise through business in emerging markets. Among such topics include underwriting and other technical topics being discussed including buyer scoring, premium pricing, portfolio risk management as well as reinsurance support. Relationships and contacts are continuously being developed between participating ECAs. The networking among ECAs through e-mailing forum allows each participating ECA to ask for answers on technical/underwriting questions and to answer questions from other ECAs or just to share experiences in underwriting risk with certain buyers, banks and countries.
The Prague Club has allowed new ECAs members to better comprehend standard regulations such as the OECD Consensus, the Berne Union Understanding, premium system standardizations and to assist members to align their procedures as well as processes with generally accepted standards. This has contributed to the transparency of the national export credit insurance scheme.
New products are another area for detailed exchanges, as members expand their offerings into areas such as domestic credit insurance, pre delivery products, local currency, investment insurance, and corporate risks etc. Even if the business in not covering these, they are looking ahead to develop best practices, as well as look at developing complementary products such as factoring and co-operation with commercial banks. While the meeting focus has traditionally tended to fall on short term issues, where most emerging ECAs are involved, it also spotlight medium/long term (MLT) credit and investment insurance which has grown in tandem with business trends of other large ECAs.
The great value in listening to the exchanges among members by learning alot as sometimes the newer ECAs raised questions that have not been raised earlier or covered in previous meeting thus allowing members to re-think an issue on problem and share their experiences.
During country risk session, several selected countries are discussed and the risks on payments and collection experiences are reviewed by ECAs as well as the levels of financial commitment made and arrears. Country Risk discussions are included in the agenda based on the queries raised by the members themselves. The credit insurance obligations of countries as insured by the Berne Union members are shared by the Secretariat to the Prague Club members. Also experiences of certain banks from which other ECAs possess is shared.
Furthermore, the highlights of the perfromance of the ECAs of the Prague Club are compared and reviewed too. These include business declared, premium collected, claims paid, recoveries made, as well as underwriting results. This is interesting as it may provide basis of bench of mark of comparison to various ECAs as well as the average for the whole members of the Club.
Case studies for both short term, medium and long term credit insurance are tackled in various syndicate groups which provides necessary practical learning experiences for ECAs staff. Various findings and alternative solutions and justifications by the groups are reported to all the participants once it reconvenes.
The ECGA has entered into such bilateral cooperation agreements with a number of ECAs of the Prague Club that include ECAs from such countries as Romania, Iran, Slovenia, Thailand, Jordan, Kazakhstan and lately with Uzbekistan. Such bilateral cooperation include exchanges of infromation of buyers, sharing experience in payments of claims on particular debtors/guarantees, assist in the recovery efforts, or rendering legal opinion as well as recommending lawyers and familiarization visits and training.
Prior to its meeting in Muscat, the Prague Club at its previous Spring meeting in Belgrade, Serbia approved the fromation of the Working Group which is an advisory body whose function is to support the Secretariat in the preparation of its meetings/workshops by actively proposing and developing agenda, topic ideas as well as to take on active part of technical discussion and when required, assist in writing papers of technical topics. The approved 7 members of the newly established working group of the Prague Club were from Thailand, Bosnia Herzegovina, Estonia, Hungary, Czech Republic, Africa Trade Insurance Company which is multilateral ECA based in Kenya and Oman. By being a member of the Working Group, the ECGA of Oman would even play greater role so that it could contribute its own experiences through the years as well as benefit from its association from the dynamic and professional expertise of both the Prague Club members and the Secretariat of the Berne Union.
IN THE NEWS
1. The Sultanate of Oman won Grand Prize of Economic Freedom 2006
According to the annual report by International Research Organization in cooperation with Fraser Institute of Canada, the Sultanate of Oman won the grand prize of Economic Freedom 2006 in the Arab World. Thus the Sultanate was ranked number one in the 22 Arab countries in terms of economic freedom.
2. The Prague Club Meeting of the Berne Union held in Muscat
The Prague Club of the Berne Union which is International Union of Credit & Investment Insurers commenced its meeting on December 4th, 2006. The meeting was opened under the auspices of His Excellency Mr. Darwish bin Ismail Al-Balushi, the Secretary General of the Ministry of Finance. It was represented by Export Credit Agencies (ECAs) of 30 countries as well as the Secretariat of the Berne Union based in London. The Secretary General of the Berne Union welcomed His Excellency who then delivered an opening welcome speech. The meeting was chaired by Mrs. Vida Zabukovec of Slovenia who is the Chairperson of the Prague Club. The Export Credit Guarantee Agency of the Sultanate of Oman hosted the meeting in coordination with the Secretariat of the Berne Union. A number of national and multilateral export credit agencies attended for the 2 days meeting followed by the workshop on December 6th.
The agenda for the meetings and workshops covered various matters including recent developments in ECAs member schemes, technical issues of credit insurance pertaining to short, medium and long term businesses, SMEs, round table discussion on selected countries, management of credit polices, claims and recoveries, domestic credit insurance, reinsurance, etc.
There were number of presentations from invited external speakers from abroad. These included presentation by Mr. Luis Antonio Ibanez of CESCE from the Spanish Export Credit Agency on the value of export credit insurance and Mr. Henrik Welch of EKF which is Export Credit Agency of Denmark on Reinsurance Agreement and Sovereign Risks Default Swap. Ms. Anne Lisa Sandvig – the Consultant of the Prague Club provided presentation on Short Term Policy Management. . Other ECAs presenters of the Prague Club members included Ms. Aida Musagic of Bosnia Herzegovina on New Premium Calculation Method. Mr. Paul Mojalefa of South Africa an Underwriting, Mr. Jarupt Panitying of Thailand on the situation in Thailand, Mr. Edvard Ribaric of Croatia on Claims and Recoveries; Mr. Csaba Simon of Hungary new non-marketable SMEs products, as well as Mr. Nasir bin Issa Al Ismaily from ECGA of Oman who delivered presentation on marketing of ECGA's services to the Omani exporters followed by a brief film on ECGA's activities.
Among invited resident speakers included Mr. Bruce Macphail of Oxford Business Group who delivered presentation on Industrial Development of Oman focusing on Sohar where a number of big industrial and Petro-chemical projects are being implemented and Dr. Hatem Shanfari Professor of Sultan Qaboos University and Deputy Chairman of Oman Economic Association who provided presentation on GCC Economies: Opportunities and Challenges comparing various economic indicators of the six GCC countries and other selected countries who are members of the Prague Club.It is worth mentioning that the third day which was devoted to a workshop, focused on the critical elements to achieve success in marketing credit insurance as well as claims and market segmentation which were guided by moderator Mr. David Venediger of Coface Group of France.