WEDNESDAY, MAY 8, 1985
9
INSURANCE ROLE IN EXPORT PRICING OUTLINED
****
THE INSURANCE COVER AND SERVICES PROVIDED BY THE EXPORT CREDIT INSURANCE CORPORATION COULD PLAY A DECISIVE ROLE IN INFLUENCING THE PRICE COMPETITIVENESS OF HONG KONG'S EXPORTS, ITS COMMISSIONER, MR K.Y. YEUNG SAID TODAY (WEDNESDAY).
MR YEUNG WAS SPEAKING ON THE HONG KONG EXPORT CREDIT INSURANCE CORPORATION - ITS RAISON D'ETRE AT A LUNCHEON MEETING OF THE ROTARY CLUB OF HONG KONG ISLAND EAST AT THE EXCELSIOR HOTEL.
HE SAID THAT THE ECI C'S ROLE IN PROMOTING PRICE COMPETITIVENESS WAS FOUNDED ON THREE MAJOR CONSIDERATIONS.
+FIRST, BY A POOLING OF RISKS, THE PRICE OF AN INDIVIDU AL FIRM'S GOODS SHOULD BE LOWER THAN WOULD BE THE CASE WERE THE FIRM TO CARRY ITS OWN RISKS AND BUILD IN ITS OWN PROTECTION.
+MOREOVER, THE INSURED EXPORTER COULD FIX HIS EXPORT PRICES IN THE CERTAINTY THAT HIS POTENTIAL LOSSES ARE LIMITED, + MR YEUNG SAID.
SECONDLY, HE SAID. THE ECIC WAS IN THE BUSINESS OF ASSESSING AND TAKING A VARIETY OF CREDIT RISKS, AND WAS IN A MUCH BETTER POSITION THAN THE INDIVIDUAL EXPORTER OR MANUFACTURER IN JUDGING THE CREDIT-WORTHINESS OF A PROSPECTIVE OVERSEAS BUYER.
THIS CREDIT ADVISORY SERVICE, HE POINTED OUT, WAS BACKED UP BY A COMPUTERISED LIBRARY COMPRISING SOME 18 000 EXPORTER FILES AND 55 000 BUYER FILES, THE CONTENTS OF WHICH WERE AUGMENTED AND UPDATED BY THE NETWORK OF BANK, STATUS AGENCY AND DEBT COLLECTOR REPORTS, AND BY REGULAR FEEDBACK FROM OTHER EXPORT CREDIT INSURANCE ORGANISATIONS IN THE BERNE UNION.
THIRDLY, AND VERY IMPORTANTLY, THE AVAILABILITY OF AN ECIC POLICY WOULD RENDER THE EXPORTER MORE ACCEPTABLE TO BANKS AND OTHER LENDING INSTITUTIONS FOR THE PURPOSE OF DISCOUNTING THE BILLS AS CLAIMS BENEFITS ARISING FROM THE ECIC POLICY WERE FREELY ASSIGN ABLE TO THE LENDING INSTITUTIONS.
+IT IS A FACT THAT OVER 65 PER CENT OF OUR POLICYHOLDERS HAVE ASSIGNED THEIR CLAIMS BENEFITS TO THEIR RESPECTIVE BANKS AND DTCS, WHICH PROVES THAT THE ECIC POLICY IS GOOD COLLATERAL SECURITY, + MR YEUNG SAID.
THE ECIC EXISTED, THEN AS A CREATURE OF PUBLIC POLICY TO PROVIDE NOT ONLY INSURANCE PROTECTION AGAINST CERTAIN CAUSES OF LOSS BUT ALSO A RANGE OF CREDIT ASSESSMENT, RISK MANAGEMENT AND LOSS SALVAGE SERVICES FOR THE BENEFIT OF THE EXPORTER AND MANUFACTURER, HE SAID.
/+WE ARE
Page 10Page 11