Improving the Role of Eximbanks/ECAs in the OIC Member States
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A number of the lending ECAs offer classic buyer’s credit facilities to overseas buyers of their
country’s exports. This includes Saudi Arabia’s SEP, Malaysia EXIM, Turk EXIM, Indonesia EXIM
and EDBI of Iran. Turk EIXM and MEXIM both offer Project Finance facilities.
4.6.2. Guarantees
Most of the lending ECAs/EXIMs (Turk EXIM, NEXIM, SEP, MEXIM, Indonesia EXIM), apart from
EDBI of Iran and EDBE of Egypt) also offer guarantees to commercial banks for the same kinds of
transactions described above. From the exporter’s perspective, the financing product is the same
regardless of the funding agent. Both approaches can support direct financing in both local and
foreign currencies. The guarantee programs of Jordan, Albania and Pakistan focus on offering
guarantees to banks.
The range of guarantees offered by OIC ECAs include export credit guarantees (pre and post
shipment), domestic credit guarantees, export working capital credit guarantees, as well as
international guarantee to foreign/local banks Includes buyer credit guarantees.
4.6.3. Insurance facilities
Insurance facilities of ECAs are the most common ECA product offering. All countries which have
export credit entities in the OIC offer traditional export credit insurance – either on a whole
turnover basis, or specific transaction basis. A number of ECAs offer insurance on domestic sales
as part of the whole turnover policy, notably Senegal, Egypt’s ECGE, Jordan, LCI, and Oman. The
only entities not offering this credit insurance product in the region are those with “sister
agencies”, such EDBI in Iran and EDBE in Egypt, as well as PEFG in Pakistan, although that
product was envisaged to be introduced. Some ECAs also offer banks a credit insurance product
to cover documentary credits. This includes SEP, KazExportGarant and Malaysia EXIM.
Fewer ECAs offer foreign investment insurance. The ECAs of Indonesia, Kazakhstan, Malaysia
offer this product. Uzbekistan offers inward investment insurance.
4.6.4. Bonding facilities
ECAs offer bonding facilities, in support of bonds or guarantees such as tender, advance payment,
performance bonds etc. These can include insurance against unfair or wrongful calling of bonds,
covering essentially the political risks associated with the instrument, or can be guarantees
against any calling of the bond – wrongful or rightful. A few ECAs have such facilities available,
including those from Senegal, Algeria and Bahrain (through the Bahrain Development Bank),
Iran, Malaysia, Turkey and Uzbekistan.
4.6.5. Islamic finance and insurance instruments
A small number of entities provide Islamic finance and insurance instruments, namely Qatar’s
TASDEER, Indonesia’s Eximbank and ASEI as well as Malaysia’s MEXIM.
Indonesia EXIM and Malaysia EXIM offer Islamic versions of their conventional financing
offerings. TASDEER and MEXIM offers Shariah-compliant credit insurance, while ASEI offers
Shariah-compliant general insurance. Business volume from these activities is very limited, with
almost all entities merely indicating the types of instruments offered rather than the amount.
MEXIM had more comprehensive figures on its Islamic Finance portfolio which is presented in
Table 5 below.