The latest statistics shows that by October the credit insurance for export in our city has reached 1.4 billion USD, an increase of 100% over the same period of last year. The credit insurance for export, which is in line with WTO rules, is a legal means to promote trade. Nearly 40% major economies in the world attribute their export to the credit insurance. 25% of export increase is due to the support from credit insurance for export.  

When faced with many such disadvantages as appreciation of Reminbi, decrease in foreign demand, increase in cost and conflict in foreign trade, export-oriented enterprises are a little worried and seek security from credit insurance, which is expected to provide them a ‘seat belt’.  

In view of the great number of small and medium-sized enterprises, China Export & Credit Insurance Corporation (Cixi Branch) attracts an increasing number of them by setting a special insurance item. The first 10 month witnesses about 180 enterprises buying insurance with the Corporation. With the spreading of export insurance, the compensation case reaches 60 and the total amount compensation reaches 10 million USD.  

Experts from the corporation say that the global economy is recovering from crisis, but the risk involved can not be overlooked. Enterprises are advised to attach importance to not only exchange rate between RMB and major currencies in the world, but also the exchange rate among currencies of countries they have contact with. Appreciation of the currency of a buyer often means the lowered cost and higher export price so that both parties can share the pressure caused by appreciation of RMB. Devaluation of the currency of buyer often means a buyer is not willing to pay more money and their capacity of purchase will be affected, thus increasing the risk of their refusal of cargo and delay of paying. The export insurance is aimed at relieving the pressure of enterprises.

Experts also say that export credit insurance can help enterprises not only gain compensation when buyers refuse to pay, but also enhance their own competitive edge. By using export credit insurance, enterprises can use non-credit settlement so as to save unnecessary cost and capital used in initiating credit cards, thus enhancing the competitive edge of enterprises and increasing their market share. While implementing going-out policy, enterprises can be better protected from export credit insurance.