Geneva, 22-24 October 2001

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E-Trade Finance as a competitiveness E-Trade Finance as a competitiveness enhancement for SME's in developing enhancement for SME's in developing

countriescountriesPresentation to UNCTADPresentation to UNCTAD

Geneva, 22-24 October 2001Geneva, 22-24 October 2001

Geneva, 22-24 October 2001

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Cost and need for credit are higher for Cost and need for credit are higher for companies in emerging marketscompanies in emerging markets

poor information

high perceived risk

low credit management expertise in companies and banks

Geneva, 22-24 October 2001

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supplier credit (in intercompany trade) is the first source of funding for

a significant number of companies and countries

This is true for trade creditThis is true for trade credit

Geneva, 22-24 October 2001

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higher cost for import

lower value for export

financial constraints for companies and economies

Consequences are very negative for Consequences are very negative for companies in emerging markets and for companies in emerging markets and for their national economiestheir national economies

Geneva, 22-24 October 2001

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more information available at lower cost,

more financial services available,

but tomorrow … credit refusal can be “at a click”...

Internet could make it betterInternet could make it better……or worseor worse

Geneva, 22-24 October 2001

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Coface enhances the credit of companies Coface enhances the credit of companies in emerging markets, through ...in emerging markets, through ...

its expertise on companies in emerging markets

its tradition of shared expertise with institutions in emerging markets

its innovative Solution

Geneva, 22-24 October 2001

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Trade credit with SME's in emerging Trade credit with SME's in emerging countries can be protectedcountries can be protected

Coface has pending trade credit risk on 220,000 companies in emerging markets, most of them SME's (out of a total of 2.2 million)

These covers represent $15 Bn turnover in emerging markets (out of a total of $150 Bn)

We have on line data on 1.2 million companies in emerging markets (out of 41 million in our database)

Our credo: there are good companies in every country

Geneva, 22-24 October 2001

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Trade Credit management expertise Trade Credit management expertise can be shared with institutions in can be shared with institutions in emerging countriesemerging countries Coface shares its credit system with partners in 47 countries, a

majority being emerging countries

Among our partners: national eximbanks or national credit insurers of

Algeria, Brazil, China, Czech Republic, Egypt, India, Kuwait, Morocco,

Malaysia, Oman, Poland, Romania, Singapore, Thaïland, Tunisia …

All these institutions are linked through Internet to our "Common Risk

System", through a CreditAlliance

Geneva, 22-24 October 2001

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The SolutionThe Solution

The @rating credit opinion@rating credit opinion on a company tells

if one can extend trade credit to this company

@rating Protection@rating Protection covers the credit risk on a

company, up to its @rating credit opinion level

A company can certify its quality worldwide

through the @rating Quality Label@rating Quality Label.

Confidence in commercial partners

Easier access to credit

Enhanced credit worthiness

is the first insurable company rating, rating 41 million companies worldwide. It is the basis of 3 exclusive lines.

Geneva, 22-24 October 2001

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@rating solution is available on line@rating solution is available on line

Though 300+ @rating partners, in 80+ countries

And via cofacerating.com

Geneva, 22-24 October 2001

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What is the What is the credit opinion? credit opinion?

It indicates on line to any interested party if one can safely extend trade credit to a company and, if so, how much :

1@, 2@, 3@, 4@ for recommended outstandings of 20 K€,

50 K€, 100 K€ or more

or X if there is an element of weakness

Geneva, 22-24 October 2001

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Quality Label: the only way to Quality Label: the only way to

certify its certify its creditworthinesscreditworthiness for an emerging for an emerging

market SMEmarket SME

You are a company, you have a contact with a new partner, a

prospective supplier or a customer; how can you tell him that you

deserve credit in a quick, understandable, free and reliable way? Just by

telling him, "my company deserves the Quality Label, which

you can check for free on cofacerating.com.”

Geneva, 22-24 October 2001

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Trade Finance on line : how it Trade Finance on line : how it worksworks

@rating protection,

single risk,

100%, on line,

without recourse, worldwide

Coface

CUSTOMER

Trade Finance on line

BANK

VENDOR

Credit opinion

Geneva, 22-24 October 2001

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Some E-Commerce / E-Finance platforms Some E-Commerce / E-Finance platforms with "@rating inside" used by SME s in with "@rating inside" used by SME s in emerging marketsemerging markets

Trade Card, end to end foreign trade e-management (members in Hong Kong, Korea, Taiwan…)

Sino Pack, e-factoring (members in Saudi Arabia, Brazil, Romania…)

VFM (Fruits) or Go Trade Sea Food (Fish), e-market places (members in South Africa, Turkey, Hungary, Angola, Vietnam…)

Geneva, 22-24 October 2001

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Integrated Solution for factors - i.e. Bank Integrated Solution for factors - i.e. Bank SinoPacSinoPac

Geneva, 22-24 October 2001

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Some projects under developmentSome projects under development

Indian Eximbank Factoring JV

IFC Securitization of Trade Finance for emerging markets exporters