As exports are forecast to slow down this year amid rising foreign currency exchanges rates, Korea Trade Insurance Corp. (K-sure) is rolling up its sleeves to come to the aid of SMEs and middle market enterprises, who have been buffeted by inside and outside shocks.
K-sure has a strategy to set aside to up 100 trillion won in trade insurance this year to offer financial support to SMEs and middle market enterprises, the largest-ever amount.
In a meeting with reporters at K-sure headquarters in Sejong City on Jan. 15, K-sure Chairman & President Jang Young-jin said, “Amid sagging export outlooks for this year, we have prepared much to overcome slugging exports, and K-sure, recognizing the fact that the survival of SMEs depends on the revival of exports and the national economy, will attach top priority task to supporting SMEs.”
K-sure will create a department responsible for helping SMEs grow into middle market enterprises and finance 100 trillion won this year, K-sure Chairman & President Jang said.
K-sure decided to pour a total of 252 trillion won to support exporters this year, the largest-ever amount. The figure is 15 trillion won more than the financial support extended to exporters last year.
In particular, the financial support to SMEs and middle market enterprises is set at more than 100 trillion won.
To this end, K-sure increased the number of teams responsible for middle market enterprises from one to two.
The corporation plans to diversify support of financial resources by raising contributions from banks and companies, on top of the government’s contributions, and expand preferred financing.
K-sure plans to expand the scope of export finance to cultural content sectors, such as K-dramas and web-toons, by inaugurating a cultural industry guarantee and lead efforts to globalize middle market enterprises.
K-sure Chairman & President Jang said, “We’ve prepared much to not only ensure quantitative growth but also raise the number of recipient companies, and the number of companies who signed up for trade insurance as of the end of last year totaled 46,000, half of the total export SMEs.”
K-sure is coming to the aid of companies wanting to enter overseas markets. The corporation plans to release new products guaranteeing risks of payments in arrears.
Korean financial institutions, including Korean property insurance companies, have strategies to enter global markets through localized insurance companies.
Companies’ localization in overseas markets is a must as protectionist trade policies spread. Korean businesses must realigning their global supply chains.
A K-sure official said, “Since export support primarily goes to Korean companies, there are cases of operational difficulties, and K-sure will offer support to locally incorporated companies so they can concentrate only on production and selling without fear of an operating funds shortfall and delinquency of sales receipts.”
K-sure plans to expand its branch offices’ roles by supporting large-sized overseas projects.
To this end, the corporate inaugurated the New Business Finance Division, a new entity responsible for defense industries, in a reorganization, conducted last December.
K-sure will have its overseas branches expand their responsibilities, from conventional recovery of debts and a credit survey, to help companies land orders, such as exploring information on new projects in each country.
The corporation will establish a branch in Washington DC in the first half of this year to gather real-time information on political and economic developments in the United States in accordance with the inauguration of U.S. President Donald Trump’s 2nd-term administration.
K-sure Chairman & President Jang said, “With the deepening of protectionist trade moves in the wake of the inauguration of U.S. President Donald Trump’s 2nd-term administration, China’s supply glut and widening foreign currency fluctuations, the Korean economy and exports are expected to undergo difficulties this year.
Based on a sense of pride and knowhow, K-sure contributed to achieving the best-ever export performance with the largest-ever support to SMEs and middle market enterprises last year.”
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