This week the New Zealand government announced the implementation of the New Zealand Export Credit Office’s (NZECO) short-term trade credit guarantee, effective immediately.
This product is an extension of NZECO’s mandate and will enable the NZECO to provide a short term trade credit guarantee to exporters and their banks where overseas buyers are offered repayment terms of less than 360 days. The NZECO will also be working with the private trade credit insurers on ways to reinsure their risks.
This new support will be provided by NZECO on a temporary basis, for a period of up to June 2011, whilst the impacts of the Global Financial Crisis are being felt. This will ensure that exporters have the means to continue to accept orders that in the current environment might otherwise not occur.
To qualify, exporters and/or their banks must confirm that the private sector is unable to provide or continue to support the export transaction(s) on reasonable terms and conditions. The export transaction must also be commercially sound with a credit-worthy buyer or bank.
The new short-term trade credit guarantee will be available immediately and the NZECO will promptly engage with private sector trade credit insurers on options for reinsurance.
For further information see Short-Term Trade Credit Guarantee and related Questions and Answers about the product.
If you have any additional queries please contact the NZECO staff, or click on Application Forms to download the Short-Term Trade Credit Guarantee Application Form.