Credit and export insurance: anti-crisis lever – Inese

Credit insurance and exports are two fundamental keys to boost the recovery, according to experts from Cesce, Coface, Aon and Solunion who have met at a conference online.

In the meeting they have participated Juan Francisco Pacheco, Chief Risk Officer Cesce; Enrique Cuadra, corporate director of Risks, Information and Collection of Solunion; Mikel Aguirre, head of Political and Single Risk de Coface in Spain and Portugal; and Mariano Villar Abad, Director of Credit Solutions at Aon.

Analysts have highlighted the determining role of credit insurance and foreign trade as levers to overcome the current crisis. “Export is the output: already helped us during the previous crisis and will be what relaunches the activity in this pandemic, and the best travel companion is credit insurance ”, highlighted Pacheco. In the same vein, the Coface representative recalled that “there is no export if there is no financing and there is no financing if there is no credit insurance.”

Uncertainty and volatility

The speakers also agreed that the economic situation will continue to be marked for several quarters by risks such as uncertainty and volatility. Villar (Aon) has described the situation as “unprecedented”, while in the opinion of Aguirre (Coface), to these risks must be added, “the duration of the pandemic because there is already talk of a third wave” and that, he said, it is a decisive factor for companies when designing their exit strategies from the crisis. For its part, Cuadra (Solunion), has added one more factor: “Greater protectionism, which is hindering international relations”In their day to day. “This context of uncertainty and volatility is going to stay,” he predicted.

International trade down

According to experts, another threat continues to be the decline in international trade. “Tariffs in the US have hit many sectors in Spain a lot and, although the US elections and Joe Biden’s victory mark a turning point, there will still be a few months of protectionism and there is time until we see positive results “, Pacheco explained.

Regarding the various sectors, experts have highlighted that the agri-food industry, distribution, technology and the pharmaceutical industry are acting as ‘refuge sectors’ in the face of the collapse of tourism, the Horeca channel and the automotive industry. In this sense, Coface and Aon have highlighted that “the recovery will be in ‘K’ and, therefore, it will be upward for some sectors and downward for others.

Opportunities in the face of the pandemic

Regarding the support of the States to companies to overcome the economic crisis, Pacheco has recognized that many have developed a system of aid “that is working correctly, but was designed for a certain duration of the pandemic and should be expanded” . “Government management will be the key“, Has indicated in this sense Cuadra, who has recognized that” official aid is slowing down the falls and insolvencies. In the words of Aon’s representative, “delinquency, bad debts and the loss ratio “ These are three indicators that will have to be very attentive in the coming months.

The experts have also released some recommendations. For Pacheco, this “It is a difficult time, but also one of opportunities; One piece of advice is to be suspicious of new clients with large operations and to safeguard the treasury a lot because it has been proven that companies stop paying their external suppliers earlier than their local ones ”. In Aon’s opinion, “anti-incident measures will have to be taken.” Finally, Coface has highlighted that “it would be good to think that credit insurance is here to stay ”.

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