The Berne Union (BU) recently published an industry report on 2019. The report includes business data for the export credit insurance industry from the previous year as well as a look at developments in the first half of 2020.
Slight decline in new business
Berne Union Members provided USD 2.4 tn of cover in direct support of export credit and foreign investments in 2019.
As usual, the largest share of new business comes from short-term export credit insurance (repayment term less than 360 days). With a 50% share of the total volume, Europe remains the most important target market for short-term export credit insurance. The greatest growth in new business was in North America (+ 13%), Sub-Saharan Africa (+ 12%) and Russia / CIS (+ 11%).
In medium- / long-term export credit insurance, new business fell by 15% compared to 2018. Numerous economic and political challenges such as falling oil prices and uncertainties due to geopolitical tensions caused world trade to stagnate.
Export credit insurer react quickly and flexibly to the COVID-19 pandemic
The current report contains a preliminary assessment of the effects of the COVID-19 pandemic. A decline in global GDP and an increase in global corporate insolvencies are expected. So far, this increase in the number of claims has not yet been recognized. The amount of the payments in the first half of 2020 was even 16% below that of the first half of 2019. You can find more about the possible reasons in the current press release of the Berne Union:
The full impact on the export credit insurance industry remains to be seen and will be the main topic of next year's report.
However, it is clear that the export credit insurance industry has so far reacted decisively and flexibly to the crisis, for example with the introduction of new liquidity-promoting instruments for domestic exporters. More on this:
About Berne Union
The Berne Union (BU) is the association of export credit and investment insurers and currently has 84 members from more than 70 countries. The members of the BU, including OeKB, promote cross-border trade. They support exports and foreign investments by hedging political and economic risks, often on behalf of their governments. In 2019, the members of the BU insured around 13% of world trade.