Bpifrance – French export market overview, an exclusive interview with the French ECA
At Excred International, Trade Finance Global’s (TFG) Deepesh Patel sat down with Maëlia Dufour, director international relations, business development, rating, environment and climate at Bpifrance and president of the Berne Union, to learn more about the intricacies of the trade credit industry.
In times of macroeconomic and geopolitical uncertainty, such as the current market environment, private companies often hesitate to engage in international trade. This fear is understandable but only exacerbates economic slowdowns and volatility. This is where public-private support from Export Credit Agencies (ECAs), supported by global organisations like the Berne Union step in and support international trade.
Credit insurance is an invaluable part of the international trade ecosystem, and multiple players exist in this arena. At ExCred International, Trade Finance Global’s (TFG) Deepesh Patel sat down with Maëlia Dufour, director international relations, business development, rating, environment and climate at Bpifrance and president of the Berne Union, to learn more about the intricacies of the trade credit industry.
ECAs and private credit insurers: same, but different?
From the outside, ECAs and private credit insurers appear to perform the same duties. But after a closer inspection, there are some important differences between the two.
Dufour said, “The main difference is that export credit agencies have to respect the principle of subsidiarity. So they let private insurers insure first and, if they cannot, the exporters then come to the ECA.”
This distinction is vital for the insurance market. In terms of trade credit, private actors are almost always the first choice when possible, but when market conditions are unfavourable or a company lacks knowledge of the local market, ECAs play an important role.
SMEs are particularly vulnerable to economic volatility. When the economy goes through a crisis, smaller companies often see their lines of credit or insurance decrease. Dufour added, “In times of crisis, if the private insurers step out, then we [ECAs] can step in by reinsuring private insurers in order for them to be able to insure the SMEs and banks.” Read More…
