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Image source: WAM
The export credit agencies of the UAE and Kazakhstan have signed a cooperation agreement to boost trade and economic relations between the two countries
Etihad Credit Insurance (ECI) and Export Insurance Company (KazakhExport) have signed a Memorandum of Understanding to strengthen trade between the UAE and Kazakhstan and support sustainable economic growth.
The MoU is in line with the vision of “We UAE 2031”, which aims to strengthen the bilateral economic relationship between the two countries and drive the business of exporters and small and medium enterprises (SMEs) towards the prospect of sustainable growth in different sectors including renewable energy and halal Manufacture of products.
Economic Commission for Europe and KazakhExport agreed to provide UAE and Kazakhstan exporters with Shariah-compliant insurance, trade credit and export solutions to protect them from potential commercial risks in international transactions.
The agreement allows both parties to collaborate in organizing workshops aimed at educating SMEs on the advantages of using trade protection solutions to mitigate the risk of non-payment resulting from a variety of commercial and geopolitical factors.
Raja Al Mazrouei emphasized the strategic importance of the partnership, saying: “By entering into this agreement with KazakhExport, we are strengthening our commitment to enhance the global competitiveness of UAE and Kazakh businesses.
“This important partnership is directly in line with ECI’s mission to boost non-oil exports while providing comprehensive protection for SMEs, thereby enriching the UAE’s economic diversification,” said Al Mazrouei.
The two entities also agreed to set up a working group to explore further opportunities for collaboration, focusing on seven strategic areas, including insurance, trade promotion and programs to support SME businesses.
The UAE is Kazakhstan’s largest trading partner in the GCC region, with total trade between the two countries exceeding approximately US$632.6 million by the end of 2022, while UAE exports to Kazakhstan amounted to approximately US$72.3 million.
Export credit agencies provide loan guarantees and sometimes direct financing to overseas buyers to facilitate the export and supply of domestic goods or contractors.
UAE trade body boosts trade
At the same time, ECI plays an integral role in supporting the UAE’s economic development, strengthening the country’s position as a global center for business and trade.
The board discussed the company’s milestone achievements in 2022 and reviewed the annual report;
The value of non-oil insurance turnover received by exporters and SMEs registered by the trade body rose 26 percent year-on-year to reach AED14.4 billion by 2022.
Economic Commission for Europe There were 8,140 revolving credit lines issued in 2022, a 23% increase from the 6,620 revolving lines of credit issued in 2021. Likewise, the value of exposures underwritten by companies reached AED 8.1 billion, an increase of 45% from AED 5.6 billion in the same period the year before.
The company secures and facilitates the UAE’s non-oil exports to 106 countries, up from 92 in 2021, while expanding into new markets, including Egypt, Iraq, Senegal, Saudi Arabia, India, Ghana, Angola, the United Kingdom and Oman .
In November 2022, ECI was assigned an Insurer Financial Strength and Long-Term Issuer Default Rating of AA- by Fitch Ratings, citing the country’s efforts to promote the UAE’s non-oil exports and strategic sectors to achieve the country’s economic agenda.
Other key drivers include ECI’s government ownership, very strong capitalization with no debt under its capital structure, as well as prudent investments, strong reinsurance program; and profitable underwriting.
read: Etihad Credit Insurance partners with RAKEZ to boost UAE’s non-oil foreign trade
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