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Media Release
Australian Minister for Trade, Mark Vaile
3 October 2001/ MVT139/2001
EFIC Alliance with NCM is a win for exporters
A world-leading export credit insurer, the NCM Group (NCM), has been selected as the preferred alliance partner for the Export Finance and Insurance Corporation's (EFIC) short-term export credit insurance business, Trade Minister Mark Vaile announced today.
This announcement follows a competitive tender process involving international and Australian companies.
"NCM's alliance with EFIC will build on EFIC's strengths, bringing together two corporations with complementary skills and experience to provide an improved range of services to Australian exporters, particularly small to medium sized enterprises," Mr Vaile said.
"This development is good news for Australian exporters as it will increase the opportunities for exporters to compete more effectively in international markets, especially at a time of increased uncertainty in the world economy."
NCM has a worldwide integrated information technology platform that provides sophisticated global underwriting processes and products underpinned by insured business of approximately $300 billion per annum. It has a buyer database of 30 million buyers and the scale of business necessary to generate the financial resources needed for the global networks, IT databases and e-commerce products increasingly characterising the export credit insurance industry.
Mr Vaile said NCM would use the alliance period of up to two years to demonstrate to Australian exporters its ability to meet their requirements. Once this had been demonstrated to the Government's satisfaction, the Government would withdraw from those elements of EFIC's business that NCM would be better placed to provide to Australian exporters in the rapidly evolving credit insurance market.
"NCM has proven and successful experience in servicing exporters through this kind of transition," Mr Vaile said.
Mr Vaile said the Government would retain the ability to support Australian exporters through that part of EFIC not subject to the alliance and contingent purchase, and through continuance of the National Interest Account. EFIC's medium-long term export finance services would not be affected by these developments.
The announcement of the preferred alliance partner of EFIC's short-term business will be followed by a short period of final due diligence as well as the negotiation and execution of relevant contractual agreements with EFIC and the Commonwealth. Subject to final agreement and execution of the contractual arrangements, the alliance is expected to come into effect in early 2002.
EFIC is Australia's Export Credit Agency - a Commonwealth Government statutory authority whose role is to help increase Australia's export trade by offering a range of insurance and finance services to exporters and investors doing business overseas.
EFIC's short-term credit insurance services that are the subject of the planned alliance with NCM provide exporters with protection against non-payment by the overseas buyers where the goods or services are being sold on terms normally less than 180 days.
EFIC's export finance services involve longer-term loan, guarantee and insurance facilities that assist the export of capital goods and related services from Australia or facilitate investment by Australian companies in overseas projects. These services are not the subject of the planned alliance.
Last year, EFIC supported some $6.8 billion of exports to 171 countries. Of this amount, some $6.4 billion was underwritten by way of short-term credit insurance services.
The NCM Group is a privately owned company headquartered in Amsterdam. In the 2000 financial year it insured business transactions worth EUR 172 billion (excl. Societą Italiana Cauzioni) against the risk of non-payment, and revenues totalled EUR 528 million (excl. activity on behalf of the Dutch State). The financial result before tax and the addition to the equalisation provision, was EUR 55 million. NCM services more than 20,000 customers world-wide, helps them trade safely in 250 countries, can provide access to information on 30 million companies world-wide and processes one million requests for buyer risk assessments yearly.
Contact: James Baker (Ministerial) 02 6277 7420 / Nicole Guihot (Departmental) 02 6261 1555
Local Date: Friday, 05-Dec-2008 13:53:20 EST