13 minute read
Insight by Charles Berry
Uzbekistan
Uzbekistan is also a strategically important trade partner for Kazakhstan in the region . In 2020, it was planned to increase mutual trade turnover between the countries up to USD 5 billion, however COVID-19 caused a drastic decrease in these figures. Still, Kazakhstan appears among the top three trade partners in export of goods to Uzbekistan, accounting for USD 2.1 billion and even boosted exports to USD 1.9 billion in 2019.
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Agricultural products and raw materials dominated in the structure of foreign trade between two countries in 2020. However, a significant volume of Kazakhstan’s export also included products related to the processing industry: aluminium and aluminium products (USD 124 million), motor vehicles and components (USD 119 million), products of flourand-cereals industry (USD 93 million), animal or vegetable fats and oils (USD 60 million), etc.
KazakhExport opened a foreign representative office in the Uzbek capital, Tashkent, in March 2019. For a period of four years, the company has provided support to Kazakh producers with their exports to Uzbekistan to the value of USD 80 million. The highest volume of insurance support, USD 64 million, was recorded in 2020, which is a six-fold increase from the previous year.
KazakhExport supported producers with exports of transformers, confectionery, starch syrup, insulation boards and ceiling skirt boards from expanded polystyrene foam, cattle meat, coke, mineral wool, reinforcing bars, cement, polymer and cable products, sunflower oil, polysulfide joint sealer, polyethylene pipes, furniture, flour and macaroni products, pipes, dairy products, motor vehicles, gas and electric boilers. The company has also helped them to provide logistic and construction services. Export contracts in 2020 were supported to the value of USD 208 million.
KazakhExport proactively supports development of mechanical engineering in Kazakhstan. Since early 2020, it has financed a letter of credit for delivery of 1,064 JAC vehicles produced jointly with Uzavtosanoat JSC in the facilities of local automaker, SaryarkaAutoProm, to Uzbeksitan for an amount of USD 16.5 million. In Q4 2019 the company, though export credit insurance, supported a transaction for delivery of 400 Ravon Nexia R3 vehicles of Kazakh-Uzbek production for USD 3.4 million to Russia. Vehicles were also assembled by the carmaker in Kostanay.
This performance came true thanks to a close cooperation with different development institutions and financial organizations in Uzbekistan. The company can raise export trade financing from local banks to buy products made in Kazakhstan while providing importers with its insurance coverage under credit risk. In 2019, KazakhExport partnered with a number of banks in Uzbekistan, including Ipoteka bank, Turon bank, Tenge bank, Aloqabank, Qishloqqurilish Bank, etc.
In early 2021, several agreements were signed during a visit of chairman of Management Board of KazakhExport. These include an agreement with Ipak Yuli Bank to finance deliveries of products from local iron works and flour to Uzbekistan, an agreement with Asia Alliance Bank to implement a project of export deliveries of products of a meat cluster located in Aktobe Region to Uzbekistan. Tajikistan is a country of moderate export interest for producers from Kazakhstan due to its limited sales market. However, Kazakhstan’s export to Tajikistan in 2020 totaled in USD 693 mln. Major export items were grain, fuel, metals. Processing sector was represented mainly by products of flour-andcereals, animal or vegetable fats and oils, electrical machinery and equipment.
KazakhExport opened an office in Dushanbe, the capital of Tajikistan, in May 2019. This establishes contacts with the local business community and raises awareness about KazakhExport tools, helps exporters overcome different barriers to increase trade turnover between countries.
Major cases include arrangement of export financing for H125 Airbus Helicopters of Eurocopter Kazakhstan Engineering LLP for Somon Air LLC. Within this project KazakhExport has provided the company with export trade financing together with major partner bank – Orienbank – and it implemented major projects with insurance coverage for delivery of chemical and construction products for the major Tajik importer - TALCO MANAGEMENT LIMITED.
Overall, since 2017 KazakhExport has undertaken insurance obligations within export contracts for USD 19,2 million. It has provided insurance for deliveries of fat and oil products, confectionery, paint materials, motor vehicles, reinforcing bars, petroleum coke, mineral fertilizers, refractory products.
The company has reached cooperation agreements with different government agencies and financial institutions. Today, its partners include all the major banks of Tajikistan such as Orienbank, Amonatbonk, Eskhata Bank, International Bank Tajikistan, Spitamen Bank. It has also signed a cooperation agreement with Export Agency at the Government of the Republic of Tajikistan.
Looking ahead
In early 2021, President of the Republic of Kazakhstan instructed the Ministry of Trade and Integration to speed up in quality terms operations for establishment of a national distribution network, ensure conditions to saturate the market with domestic products and sustainable development of this sector. The system must become a foundation for Eurasian distribution network consisting from a network of wholesale distribution centers in Uzbekistan, Tajikistan and Russia. In particular, take measures in order to enhance trade and logistic potential of Kazakhstan from viewpoint of expansion of sales markets for products made in Kazakhstan and involvement in cooperation projects within the EAEU and with third countries.
In this connection, KazakhExport which is subordinate to the Ministry of Trade and Integration of the Republic of Kazakhstan, will continue efforts to improve tools of insurance support, enhance relations with importers in countries of presence of its foreign representatives, promote export of non-primary products abroad.
ANNOUNCEMENTS
Micaela Cojocaru
Global Head of Trade Credit & Surety Company: Sompo International’s Global Reinsurance Micaela Cojocaru has been named Global Head of Trade Credit & Surety for Sompo International’s Global Reinsurance business effective 1 March 2021. Micaela joined the company in November 2012 as Deputy Head, and succeeds Christoph Virchow, who after 30 years in the industry, will retire and transition to an advisory role on 1 May 2021.
With more than twenty years in the trade credit and surety market, Micaela has held various senior roles on both the underwriting and broker side including Senior Vice President Trade Credit and Surety with Munich Re, Senior Consultant at Chiltington Consultants and Director Credit and Bond at Howden Broking Group.
In her new role, Micaela will build on the successful strategy already in place for the firm’s Trade Credit & Surety global reinsurance offering while focusing on further positioning Sompo International and the business as a relevant and committed partner for professional players in the industry. Micaela is based in the company’s Zurich office and can be reached at mcojocaru@sompo-intl.com.
Bernardo Sanchez Incera
Chairman Company: Coface Following the change in the shareholder base and the arrival of Arch Capital Group Ltd. (Arch) - (NASDAQ: ACGL) - in Coface’s capital, COFACE SA’s Board of Directors is evolving. Bernardo Sanchez Incera has been appointed Chairman of the Board of Directors.
The transaction between Natixis and Arch for the sale of a stake in Coface’s capital, which was announced on 25 February 2020, has received all the necessary approvals for its closing. As a result, Arch now holds 44.8m shares of Coface, representing 29.5% of the company’s capital.
In accordance with the statements made when the agreement was announced, all the directors representing Natixis have resigned. The Board then co-opted four directors presented by Arch as well as Bernardo Sanchez Incera, who was then appointed Chairman of the Board.
As of today, Coface’s Board of Directors has therefore 10 members, 4 women and 6 men, the majority (6) of whom are independent directors. Coface’s general management wants to thank Natixis and BPCE board members for their personal involvement and their contribution to Coface’s governance over the past years. The Board of Directors reaffirmed its confidence in the management team and the relevance of the Build to Lead strategic plan. Bernardo Sanchez Incera, Chairman of Coface, declared:
“First of all, I would like to thank Coface’s Board of Directors for the trust they have placed in me. In this very unusual period, I have a total confidence in the ability of all the Coface teams, under the leadership of Xavier Durand, to continue implementing the Build to Lead strategic plan. I am also pleased to welcome the representatives of Arch Capital Group.”
Declan Daly is appointed Group Chief Operating Officer of Coface
Declan Daly
Chief Operating Officer Company: Coface Group Declan Daly has been appointed Chief Operating Officer of the Coface Group, effective as of April 1, 2021. He will continue to report directly to Xavier Durand, the Coface Group’s Chief Executive Officer, and will join the Group’s Executive Committee. In this newly created role, Declan will be responsible for furthering and accelerating Coface’s transformation terms of service quality and operational efficiency across the Group.
This role is a part of Coface’s “Build to Lead” strategic plan. Building on Coface’s previous “Fit to Win” strategic plan, Build to Lead focuses on operational efficiency and customer service quality. The objective of this plan, launched in February 2020, is to position Coface as a leading player in the credit insurance sector, particularly in terms of service quality. Declan has a very strong record of accomplishment in operations management as well as business transformation, both in the financial services sector and in the manufacturing industry.
Declan has been Chief Executive Officer of the Central & Eastern Europe Region at Coface since 2017. He started his career in software engineering at ABB in Ireland and Austria, before joining General Electric Company in 2000. In 2002, he became Operations Director of GE Money Bank in Switzerland, before being appointed Managing Director of GE Money Bank in Austria in 2006. In 2009, he joined the Western Union Financial Services management team as Vice President of the European region, heading the B2B business. In 2014, Declan was appointed CIO and member of the Executive Committee of Semperit Holding AG.
Declan, 54, holds a degree in electronic engineering from Dublin City University and an MBA from INSEAD. Declan’s successor will be announced at a later date. In the meantime, Jaroslaw Jaworski, CEO of Coface in Poland, will act as interim CEO of the Central & Eastern Europe region.
Liberty Mutual
Since March 1, all surety activities of Liberty Mutual in Europe operate under the name of Liberty Mutual Surety to reflect the fact that they are now one organisation.
This includes the surety activities in the branch offices of Liberty Specialty Markets in France, Germany, Italy and the United Kingdom, as well as the former AmTrust surety activities in Spain. Most notably, it also includes the activities of Nationale Borg in the Netherlands and Belgium. The Nationale Borg brand disappears from the market after more than 127 years. Nationale Borg was one of the oldest dedicated surety companies in Europe and a long-time member of ICISA.
Introducing Intact Insurance Specialty Solutions, formerly OneBeacon and The Guarantee.
We are proud to announce that we are now operating under a single name throughout North America. Intact Insurance Specialty Solutions is here with the same depth of expertise you have come to know and trust, and tailored solutions for a wide range of industries, including surety bonds.
One team. One brand.
Intact Financial Corporation (IFC) is the largest provider of property and casualty (P&C) insurance in Canada and a leading provider of specialty insurance in North America. In 2017, Intact emerged as a leading provider of specialty insurance throughout North America with the acquisition of OneBeacon Insurance Group. In 2019, the company continued to expand its North American footprint with the acquisition of The Guarantee Company of North America, further solidifying its commitment to surety.
Today, Intact is the sixth largest provider of surety bonds in North America.
This year Intact continued to expand and strengthen its surety capabilities with the acquisition of International Bond & Marine Brokerage, Ltd. (“IB&M”), a market-leading brokerage providing risk management solutions to the international trade industry. As a result, Intact Surety can provide a full suite of customs bond capabilities to customers and brokers. Now, fully integrated, the entire North American specialty team operates under a single brand. We look forward to continuing to provide our customers and brokers with our hallmark specialized products and dedicated services, backed by the strength of the Intact brand.
Euler Hermes Asia Pacific appoints ASEAN CEO
Shan Aboo
Chief Operating Officer Company: Euler Hermes Euler Hermes Asia Pacific is pleased to appoint Shan Aboo to the office of ASEAN CEO, effective 1 April 2021. Mr Aboo will be based in Singapore, overseeing Euler Hermes’ operations in the ASEAN markets, namely Malaysia, Thailand, and Indonesia as well as Singapore. He will be reporting to the Head of Region at Euler Hermes Asia Pacific Holger Schaefer.
Mr Aboo joined Euler Hermes in 2008 in Dubai as a Business Development Manager covering the GCC market, before moving to Singapore as the Commercial Director for Euler Hermes ASEAN in 2012. Since 2016, he has been the Regional Director for Euler Hermes World Agency Asia Pacific responsible for expanding and servicing the multinational business accounts in the region.
Commenting on his new role, Mr Aboo says,
“I am thrilled to re-join the Euler Hermes ASEAN team and it feels like returning home in some ways. With deep roots across ASEAN and an unmatched product offering, Euler Hermes is uniquely positioned to support our clients and business partners across the region, especially during these times of economic uncertainty. I look forward to working closely with the talented and experienced ASEAN team to drive profitable growth and localized solutions in this dynamic part of the world.”
A Guide to Trade Credit Insurance
A practical and accessible industry-wide reference on Trade Credit Insurance, written by a team of industry experts.
This compact volume is a practical guide for anyone interested in Trade Credit Insurance. The International Credit Insurance & Surety Association (ICISA) presents an approachable but detailed guide written collaboratively by carefully selected industry experts. The guide describes the ‘lifeline’ of the credit insurance product, from the initial application stage to the expiration phase of the policy, including practical use aspects for credit managers. The volume offers compact information on the history of trade, the need for protection against trade credit risks, and solutions offered by credit insurance providers. The focus is on short term credit, including whole turnover policies and single risk policies.
Readership
Suitable for anyone interested in Trade Credit Insurance, from credit managers to policymakers.
Key selling points
• Collaboration of a diverse group of experts from top organisations around the world • Written in an approachable style, accessible to the non-specialist • Includes extended glossary of key terminology • Includes a list of relevant resources for further reading
Content
Foreword; Introduction; Disclaimer; 1.What is trade?; 2. What is trade credit insurance?; 3. Product types; 4. Risk types; 5. Typical set-up of a trade credit insurance contract; 6. Premium, the price for cover; 7. Day-to-day policy management; 8. Buyer risk underwriting in trade credit insurance; 9. Debt collection; 10. Imminent loss and indemnification; 11. Renewal, expiry, termination of a policy; 12. Single risk business; 13. The single risk insurance market: Private and public players; 14. Reinsurance of Trade Credit Insurance; Trade Credit Insurance resources; Glossary of trade credit terminology
About the Author(s) / Editor(s)
The International Credit Insurance & Surety Association (ICISA) brings together the world’s leading companies providing trade credit insurance and surety bonds. ICISA promotes technical excellence, industry innovation and product integrity, as well as addressing business challenges generated by new legislation.
Where to order my copy?
The book can be ordered from Barnes&Noble and Bol.com.
