ENG-1987 — Page 106

INDUSTRY AND TRADE

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Transactions which include documents against payment, documents against acceptance and open account invoices concluded on short-term credits (maximum 180 days) are normally insured under a Comprehensive Shipments Policy which gives protection from the date of shipment. Cover can also be made effective from the date of the contract of sale instead of the date of shipment so as to provide the exporter with protection during the manufacturing stage. For exports of capital goods and services sold on medium or long-term credits with payments spreading over two to five years or longer, the corporation provides other types of insurance policies to cater to the individual needs of the exporters. There has been a tendency for overseas buyers to establish their own buying offices in Hong Kong. More recently, the buying offices have gradually moved away from their traditional role as agents for the overseas parent companies to become principals in their own right in transactions with local manufacturers or suppliers. This means when the buying office defaults or becomes insolvent, the Hong Kong manufacturer has no legal right to pursue payment from the parent company of the buying office. To protect Hong Kong manufacturers, the corporation created in early 1987 a new facility to cover the credit risks on sales by Hong Kong manufacturers and suppliers to the buying office.

Although the corporation itself does not provide finance, exporters find the 'letter of authority' a useful form of collateral security in negotiating export finance facilities. For exports on medium and long-term credits, the corporation can, upon application, provide a full unconditional guarantee directly to the exporter's banker.

Many of the corporation's business operations have been computerised. This enables the corporation to deal with policyholders' enquiries speedily in respect of around 55 000 overseas buyers and to process some 10 000 credit limit applications a year.

In 1987, close to $8,800 million in goods and services were insured by the corporation, which earned a premium income of more than $54 million. Some 80 claims were paid, involving a total of $13 million.

Other Trade and Industrial Organisations

The Hong Kong General Chamber of Commerce, founded in 1861, is the oldest and largest trade and industrial association in the territory. It comprises more than 2 700 companies representing all branches of commerce and industry. The chamber is actively involved in promoting Hong Kong's trade and attracting new industries. It is a member of the International Chamber of Commerce and has been approved by the Economic and Social Commission for Asia and the Pacific to arbitrate in commercial disputes. The chamber provides a wide range of services to its members and to more than 8 000 non-member companies. These include the issue of certificates or origin, commercial carnets, endorse- ment of invoices and the processing of trade and industrial enquiries. The government regularly consults the chamber on important issues affecting trade, industry and aspects of social development.

An independent body incorporated in 1981, the Hong Kong Trade Facilitation Council was set up to promote, stimulate and assist the facilitation of international trade procedures and the documentation and information flows associated with them. Its members comprise representatives of the government, and of trade and industrial organisations. In recent years, the emphasis in trade facilitation work has shifted from paper to the transmission of essential trade data by sophisticated electronic means. In line with this trend, the council is looking into a proposal for a comprehensive electronic system for the transfer of data between interested parties. To keep itself abreast of developments elsewhere, the council