Chairman & President Lee In-ho of Korea Trade Insurance Corp. (K-sure) (Photo: K-sure)

Total amounts in trade financing, provided by Korea Trade Insurance Corp. (K-sure), surged to 130.8 trillion won in the first 10 months of this year, representing an increase of 6.2 trillion won over the same period last year.

The year’s total amounts are forecast to top 155 trillion won, more than the 149 trillion won a year ago.

The figures are illustrative of the stark reality facing Korean exporters of late.

Chairman & President Lee In-ho of Korea Trade Insurance Corp. (K-sure) said in a recent interview with a vernacular economic daily that Korea has a structure in which Korean-made intermediate products like semiconductors are exported to China, which has shipped finished items, made with Korean ones, to the United States, and uncertainties like U.S.-Chinese trade conflicts have been shaking up the global supply chain mechanism, particularly dealing a severe blow to countries such as Korea.

The exacerbating of overall export conditions delivered a dent to Korea’s standing as an exporter. Chairman Lee said it is too earlier to expect that the United States and China will completely conclude an agreement on trade conflicts. Lee said he was worried that such a situation of not removing such uncertainties leaves Korea’s export conditions hanging in balance.

So far this year, K-sure has taken “relief pitcher” steps to ease a shortage of funds facing exporters, a guarantee for the early encashment of export accounts receivable and a special guarantee based on export contracts.

The steps are designed to relieve the financial troubles SME exporters temporarily experience. The special guarantee based on export contracts is a facility in which K-sure helps exporters encash accounts receivable before their settlement date.

The steps are designed to ease the shortage of money by reducing the payments receivable on export accounts - two or three months it normally takes.

In the first 11 months of the year, 51 companies have export accounts receivable worth 508.3 billion won guaranteed under the acheme for the early encashment of export accounts receivable.

Four hundred and thirteen companies have export accounts receivable worth 49 billion won guaranteed under.

Japan’s export curbs on Korea, which went into force in July, have added pressure to exporters, already suffering from declining exports. K-sure has strengthened imort insurance to provide support to Korean companies in the raw materials, parts and equipment sectors being buffeted by Japan’s export curbs on Korea.

Chairman Lee said K-sure plans to introduce a special guarantee on facility funds for raw materials, parts and equipment makers as part of the corporation ‘s efforts to ramp up trade insurance financing.

For Korean exporters, this is the worst year since 2016. The nation has to brace for next year, which is predicted to be difficult.

Chairman Lee said it is hard to say that the national economy for next year will get better, saying there is no place predicted to have a rosy outlooks next year in the United States, Europe and South America on top of U.S.-Chinese trade conflicts. K-sure plans to provide 158 trillion won in trade financing support next year, 3 trillion won more than this year, particularly focusing on export financing targeting SMEs, new markets, and raw materials, parts and equipment makers.

Chairman Lee said K-sure will provide utmost efforts to help SMEs cope with the hard times. K-sure plans to provide trade financing support worth 200 billion won under the special guarantee based on export contracts next year.