SME exporters seek export credit guarantee

SME exporters feel handicapped due to lack of Export Credit Guarantee (ECG): statement

(Web Desk) - The Union of Small and Medium Enterprises (UNISAME) has invited the attention of the policy makers to the lack of facilities for SMEs in exports especially to third world countries.

President UNISAME Zulfikar Thaverm said, in a statement, that  the SME exporters feel handicapped due to lack of Export Credit Guarantee (ECG) and are apprehensive in accepting orders of third world countries. A full-fledged export credit guarantee is needed to cover losses due to non-realization of proceeds and refusal of buyers to retire documents for goods shipped under firm contracts.

Secondly he stated that the premium rate for insurance under ECG must be affordable

Thirdly it is very unfortunate that the much talked about Exim Bank is yet to commence business, he added.

Fourthly the union chief lamented that it is very difficult for the SME exporters to compete globally when our competitors in neighbouring countries are facilitated fully by their governments in terms of banking, insurance and freight subsidies.

UNISAME Council has urged the State Bank of Pakistan (SBP) to advise the commercial banks to educate their customers to take best precautions and seek avalization of bills of exchange to cover and secure realization as many SME exporters are unaware of this protective measure.

UNISAME Council said our exports can increase multifold if the exporters are indemnified against losses in transaction due to contract violations under much needed ECG and urged the SBP and commerce ministry to co-ordinate and make a strong ECG scheme.