The Nation (Nairobi)
July 27, 2004
Posted to the web July 27, 2004
Washington Akumu
Nairobi
The African Trade Insurance Agency (ATI) has started aggressively promoting the hitherto obscure export side of its business.
It is often lost on many that the financial security of companies exporting out of the continent is also an integral part of ATI's mandate.
Chief executive officer and former Lloyds veteran, Bernard de Haldevang, explains this dual character for an institution that goes by the globally recognised, and therefore inescapable misnomer, of an Export Credit Agency (ECA)."
While this article is not about Chapter 11, it does provide an excellent argument for the use of business credit insurance.
"You send a consignment of, say, fresh produce to a European buyer, taking all due care to ensure that it arrives in good shape and on time. The contacts of the importer are a prized commodity, at this time the only tangible assurance that the buyer will pay.
But the flipside of it all, that any risk-averse trader is always alive to, is the worst-case scenario: what would happen if the buyer defaults on payment?
Many a business in Africa has gone burst as a result of being unprepared for such risks. Banks always shun such trades and doubt them as a bankable proposition, especially when there is no policy covering or guaranteeing the earnings receivable by the exporter."
Business Credit Insurance
That article told me why my bank wants me to look into it.
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