export credit guarantees HOCHTIEF/Schroll

Transcription

1 export credit guarantees HOCHTIEF/Schroll interim report 2018

2 2 export credit guarantees In the first few months of the year, foreign trade slightly lost momentum, with German exports particularly feeling the effects of discussion on tariffs and trade barriers as well as the sustained political risks in key regions around the world. This presumably goes some of the way to explaining the greater demand for the German Federal Government s export credit guarantees in the first half of the year. There was a substantial increase in the number of applications as well as the value of the cover sought. As of 30 June 2018, applications worth a total of 18.6 billion euros had been received, up more than 50% on the same period in the previous year. Africa was particularly noteworthy, with exporters requesting aggregate cover of 1.32 billion euros for this region in the first six months of the year. This is just under one billion euros more than in the same period of the previous year. This growth is also reflected in the value of the cover granted. At 551 million euros for Sub-Saharan Africa, it already reached the full-year level seen in Whereas cover volume had previously been materially influenced by short-term cover under Wholeturnover Policies, guarantees were increasingly granted for individual transactions with medium and long-term payment terms in the period under review. Looking forward, demand for export credit guarantees will also hinge on the availability of sufficient alternative sources of funding in the private sector. Low interest rates and high market liquidity have also recently caused demand in government-supported cover to decline in the industrialised countries. By the same token, the risks prevailing in key foreign markets suggest that demand for export credit guarantees will remain strong as the year progresses. The combined value of applications for single transaction cover and offers of cover stood at 44 billion euros as of 30 June 2018, i.e. well up on the same period in the previous year. The extent to which the transactions for which cover has been sought actually materialise cannot be forecast reliably as German exporters are exposed to heavy international competition. 8.1 billion 77% The German Federal Government issued export credit guarantees worth 8.1 billion euros in the first half of More than three quarters of the cover provided was for the emerging economies and developing countries.

3 business performance In the first half of 2018, the German Federal Government issued export credit guarantees worth 8.1 billion euros (H1 2017: 7.7 billion euros), equivalent to an increase of 6% over the same period in the previous year. Most of the deliveries and services covered were destined for the emerging economies and developing countries. As in the previous year, they accounted for 77% of new guarantees issued. Repeating the situation in the previous year, the United States contributed the largest volume of cover primarily due to cover provided for a cruise ship. Turkey, Russia, China, Brazil and Egypt, all traditionally important markets for Hermes-covered export business, also ranked highest in the list of countries in the first half of the year. volume of new cover by country groups in billion eur Emerging economies and developing countries Industrialised countries H H top 10 markets for new guarantees as at in billion eur Financial result for the half-year Export credit guarantees generated a positive result of million euros. H H United States Turkey Russia R.F. China PR Brazil Egypt India Israel Ukraine Mexico H H Subtotal as at : (64%) 5.20 Total as at : (100%) 8.09

4 H H Brazil Egypt India Israel Ukraine Mexico Subtotal as at : (64%) Total as at : (100%) 8.09 APG Neuanträge Gesamt in Mio. EUR grundsatzzusagen Länder Schwellen- und Entwicklungsländer Industrieländer in Mio. EUR 8.118, , Anteil in % 89,0 11, in Mio. EUR 9.767, ,5 90 2,1 5,7 Anteil in % 80,9 19,1 Gesamt 9.124,0 100, ,6 100,0 4 H H As in the same period of the previous year, single transaction policies accounted for 48% of the guarantees cover by horizon provided. of Here, risk export as at credit guarantees in billion eur for deliveries of goods and services on short payment terms of less than one year rose by 25%, while the proportion of transactions with credit periods of between one and five years widened by 42%. At 2.9 billion euros, transactions with credit periods of more than five years were unchanged 36.4% 51.9% Wholeturnover and * Industrialised revolving policies: countries: 4.2 The group of industrialised countries includes the OECD premium category 0 countries, Single transaction i.e. the OECD high-income countries (according to the World Bank definition, policies these up to are 1 year: countries with 0.7per-capita gross income of more than 12,235 Single US transaction dollars in 2017), the countries of the European Monetary Union including policies affiliated 1 over - 5 years: the territories same and 0.2 period Singapore. in the previous year. ** European countries excluding industrialised countries: Single transaction 3.1% Albania, Belarus, Bosnia and Herzegovina, Bulgaria, 8.6% Croatia, Kosovo, policies over 5 years: 2.9 the former Yugoslav Republic of Macedonia, the Republic of Moldova, Montenegro, Romania, Russia R.F., Serbia, Turkey, Ukraine. Total as at : 8.1* Cover under Wholeturnover Policies rose by 4.7%, accounting for 52% of the total. * Differences are due to rounding expenses In the first six months of the year, the Federal Government paid indemnification of 150 million euros (H1 2017: million euros). These payments were almost solely for economic risks. At 27.7 million euros, Singapore accounted for the highest indemnification payments, followed by India (25.6 million euros) and Russia (20.6 million verteilung euros). der neu übernommenen regionale deckungen (ohne industrieländer*) per in mio. eur **/Zahl??? 1.HJ 16 Fußnote Text 1. HJ 2017 Europa** Asien Afrika Amerika HJ 2016 Gesamt 1. HJ 2016: HJ Gesamt 1. HJ 2017: regional distribution of newly granted cover (excluding industrial countries*) as at in million eur Energie: Schiffe: H H Erdöl- und Europe** 1,985 Erdgasförderung/ 1,878 Verarbeitung: Asia 2,028 2,123 Verarbeitende Africa 1,086 Industrie: 439 Infrastruktur: America 1,104 1,468 Papier-, H1 2018Holz-, Lederund Textilindustrie: H Agrarsektor und Nahrungsmittelindustrie: übrige: Total as at : 5,909 Total as at : 6,203 * Industrialised countries: The group of industrialised countries includes the OECD premium category 0 countries, i.e. the OECD high-income countries (according to the World Bank definition, these are countries with per-capita gross income of more than 12,235 US dollars in 2017), the countries of the European Monetary Union including affiliated territories and Singapore. ** European countries excluding industrialised countries: Albania, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Kosovo, the former Yugoslav Republic of Macedonia, the Republic of Moldova, Montenegro, Romania, Russia R.F., Serbia, Turkey, Ukraine. guarantees by horizon of risk as at in billion eur Wholeturnover and revolving policies: Single transaction policies up to 1 year: Single transaction policies 1-5 years: Single transaction policies over 5 years: Total as at : 8.1* 36.4% 51.9% 3.1% 8.6% regionale * Differences are verteilung due to roundingder neu übernommenen deckungen (ohne industrieländer*) per in mio. eur export credit guarantees for military goods 1.HJ 16 1.HJ 17 **/Zahl??? in million eur Europa** Fußnote Text Asien H Type of goods Afrika Egypt 5.9 Towing vehicles for use at the airport apron Amerika HJ 2017 Total H Gesamt 5.9* 1. HJ HJ 2016: * Total H1 2017: 4.0 million euros Gesamt 1. HJ 2017: um an En En en mit Um Ges ein Um Erdöl V Pa Agra exp in

5 in mio. eur **/Zahl??? Fußnote Text 1. HJ HJ HJ 16 Europa** Asien Afrika Amerika Gesamt 1. HJ 2016: HJ Gesamt 1. HJ 2017: * * Total H1 2017: 4.0 million euros revenues revenues as at in million eur Amortisation and recoveries: Premium/fees earned: Interest received/ exchange rate differences: % 16.5% 40.3% Revenues from premiums and fees dropped by 6% to million euros (H1 2017: million euros). Recoveries of indemnification paid in the past climbed by 51% to million euros (H1 2017: million euros). Interest income increased by 35% to million euros (H1 2017: million euros). 5 * Differences Total are due as to at rounding : 767.7* * Differences are due to rounding financial result for the half year financial result in million eur 1,184 At million euros in the first six months, the result for the federal budget was substantially up on the same period in the previous year (H1 2017: 92.7 million euros). Interest income is not included in this calculation. Interest received Annual result excluding interest H H outstanding risk The outstanding risk from current guarantees issued by the Federal Government stood at 84.3 billion euros as of 30 June 2018 and was 4% down on the year-ago figure (H1 2017: 87.8 billion euros). The United States (10.9 billion euros), Turkey (8.8 billion euros) and Russia (7.9 billion euros) account for the highest outstanding risk.

6 development of the export credit guarantees 6 Digital supplier credit cover: Hermes Cover click&cover EXPORT simplifying finance for small-ticket transactions On 1 July 2018, the Federal Government launched digital supplier credit cover for exporters known as Hermesdeckungen click&cover EXPORT. It is primarily targeted at small and mid-size enterprises (SMEs) seeking quick and uncomplicated cover for standardised export transactions valued at up to five million euros and with a payment period of no more than five years against the risk of politically or economically induced payment defaults. In addition, the Federal Government decided to extend the permissible horizon of risk for Credit Confirmation Risk Guarantees from one year to five years. Both measures can make an important contribution to improving the scope for financing small-ticket transactions. Detailed information on the digital supplier credit cover and credit confirmation risk cover can be found here. Product innovation On 1 July 2018, the Federal Government launched digital supplier credit cover for small-ticket items. Hermes cover online Hermes Cover online: digital application setting new standards Digital application simplifies process for requesting cover for exporters. Swift, simple and easy to handle: it has been possible for exporters to submit applications for supplier credit cover and manufacturing risk cover online since the beginning of the year. The digital application for single transaction policies for exporters supports companies step by step in requesting cover. It shows which documents must be submitted, automatically checks the disclosures for plausibility and provides an immediate indication of whether the transaction is eligible for cover. Exporters must register once free of charge on the customer portal in order to use the new application. Since the Compact with Africa Federal Government facilitating exports to Africa.

7 introduction of the new system, roughly one quarter of all applications for supplier credit cover and manufacturing risk cover have been submitted online. Starting in August, exporters can also submit digital applications for all other forms of cover. Country risk classifications: At its meetings held in January and June, the OECD experts reviewed various country risks. This resulted in the following changes: 7 Reduced uninsured portion: Federal Government facilitating exports to Africa The Federal Government has improved the scope of cover for selected countries in Africa so as to simplify export business in this region. The uninsured portion retained by the exporter or the financing bank has been lowered from 10% to 5% for goods and services to public buyers in the Compact with Africa countries Côte d Ivoire and Senegal. These arrangements also apply to Ethiopia, Ghana and Rwanda provided that this does not affect these countries debt sustainability. oecd country risk categories changes Belarus Croatia Fiji Iran Oman Turkey previously new * From 6 to 5 in January, from 5 to 6 in June. Therefore no change compared with Foreign trade finance: ECA-specific credit agreement facilitating contract drafting The new country classifications were duly adopted in the German cover system. They are used as a parameter in the calculation of the premium. Working together with European legal and financial experts, the Loan Market Association (LMA) has developed a model contract for ECA-covered credit agreements (ECA = export credit agency). This marks the first time that LMA standard contracts have been revised to include ECA-specific aspects, including for example the requirements arising from the OECD consensus for ECA-supported finance.

8 8 Dialogue event 2018: Important discussion platform for the further development of guarantee instruments More than 300 exporters and representatives from banks and industry associations took part in the Dialogue with the Business Community event, which was held on 7 June 2018 at the Federal Ministry for Economic Affairs and Energy (BMWi). After opening speeches by Thomas Bareiß, Parliamentary State Secretary at the BMWi, Prof. Dieter Kempf, President of the BDI, and Dr. Marcus Chromik, a member of the Board of Directors of Commerzbank, the participants gathered in moderated workshops to discuss current issues relating to the further development of export credit and investment guarantees. Representatives of foreign companies were also actively involved in this event for the first time. Entitled An Importer s View, one workshop provided a refreshingly different perspective, illuminating aspects of government export credit guarantees from a foreign buyer s vantage point. Nearly all the workshops dealt with recent digital developments in foreign trade and the challenges that these pose for guarantee instruments. A summary of the main content of the event on 7 June 2018 as well as a photo gallery can be found at the website of the Federal Ministry for Economic Affairs and Energy at Dialogue event More than 300 experts met to discuss current aspects of export credit and investment guarantees. IMC away-day meeting in Lengerich This year s away-day meeting took the Interministerial Committee for Export Credit Guarantees to Lengerich in Westphalia, where the headquarters of Windmöller & Hölscher are located. The company is one of the world s leading suppliers of machines and systems for manufacturing and processing flexible packaging. After its meeting, the committee took the opportunity to gain a first-hand impression of the company s strategy and production to better understand the needs of this industry.

9 The leadership function in the Interministerial Committee, which has the underwriting responsibility for Fed eral Export Credit Guarantees, is exercised by the Federal Ministry for Economic Affairs and Energy: Bundesministerium für Wirtschaft und Energie Referat VC2 Scharnhorststraße Berlin, Germany The Federal Government has appointed Euler Hermes Aktiengesellschaft (Euler Hermes), Hamburg, to manage the official export credit guarantee scheme. Euler Hermes Aktiengesellschaft Export Credit Guarantees of the Federal Republic of Germany Postal address P.O. Box Hamburg, Germany Office address Gasstraße Hamburg, Germany Phone: +49 (0)40/ Fax: +49 (0)40/ Further details, information, documents and advice on the opportunities offered by export credit guarantees and the applicable procedures can be obtained by contacting the Head Office of Euler Hermes Aktiengesellschaft in Hamburg or one of the branch offices. Extensive information material on the official export guarantee scheme, e.g. current editions of the AGA- Report, the General Terms and Conditions, application forms and information leaflets as well as the Annual Reports in English and German can also be accessed via Internet. You may request additional information material or raise your questions directly via . berlin liaison office Friedrichstadt-Passagen Quartier 205 Friedrichstraße Berlin, Germany Phone: +49 (0) 30/ Fax: +49 (0) 30/ aga-berlin@exportkreditgarantien.de Editorial deadline: 30 June 2018 Date of publication: August 2018

10 Euler Hermes Aktiengesellschaft Export Credit Guarantees of the Federal Republic of Germany Postal address P.O. Box Hamburg, Germany Office address Gasstraße Hamburg, Germany Phone: +49 (0)40/ Fax: +49 (0)40/ Branch offices: Berlin, Dortmund, Frankfurt, Freiburg /Stuttgart, Hamburg, Munich, Nuremberg, Rhineland