Improving the Role of Eximbanks/ECAs in the OIC Member States
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trade strategy. How the ECA contributes to the national policy should ideally be a
separate and distinct process with the Board playing the role of approving the strategic
plan that has been developed based on the directives from the Ministry.
o Undertake regular, external independent evaluations: Upon establishment, any ECA
will have specific objectives and goals, which will be used to develop key performance
indicators and corresponding targets and milestones. An independent body is then
assigned to undertake periodic evaluations on relevance of the institution’s operations,
whether targets have been met, obstacles in this process (if any) and recommendations
for next steps. This will allow the institution to take corrective action or sustain its
current approach, where applicable. Such periodic assessments will enable management
and operational staff to re-evaluate policies, approaches and offerings to effectively
serve exporters.
6.3. Applying Key Lessons for Improving Existing ECAs
Having been given a clear mandate and operating principles from the government, an ECA must
seek to operationalize this at both strategic and technical levels.
o Establish a clear vision and mission to define a market space in which to focus:
Stemming from a clear mandate, an ECA should have a clearly defined vision and mission
statement that relates directly to its role and mandate. If the role of the ECA is to help
promote diversification of the economy (away from non-oil exports, as an example), then
identifying this target in a well-articulated vision and mission statement is very helpful.
o Understand not only the nature of the market gaps but why they exist: An ECA
which is mandated to focus on market gaps needs to understand the reasons for the
existence of these gaps in the provision of private sector finance and insurance. For
example, there may be several reasons why banks do not lend to exporters or to support
export transactions: a) they could be uncomfortable with the borrowers’
creditworthiness or the type of risks involved; b) they could have reached internal risk
limits on certain types of risks; c) they might have sufficient exposure in a particular
sector; d) the costs of serving a certain market segment is not profitable (e.g. SMEs); or
e) as was happened during the global financial crisis, banks simply could not borrow in
the capital markets to on-lend. Gaps are also the result of inadequate information,
uncertainty on risks (e.g. including legal, institutional context), and the inability to assess
market potential. The nature of the gap will determine the type of solution the ECA
should offer.
o Understand the export market and exporters’ contribution to global supply chain:
The successful functioning of an ECA relies not only on the institution’s awareness of the
exports market and its role in the domestic economy, but also its linkage in global supply
chains and how this can be further developed or strengthened. One way of doing so is to
understand the financing ecosystem including the players active in upstream and