|SUBJECT||Emergency Meeting Held with Ten Exporting SMEs of Gyeonggi Province and Suwon|
On June 12, the Export-Import Bank of Korea held an emergency meeting at the Suwon Ramada Hotel with representatives of ten exporting SMEs of Gyeonggi Province and Suwon*.
* Includes Suwon, Anyang, Yongin, Gunpo, Uiwang, Pyeongtaek, Hwaseong, Osan, and Anseong.
As the export environment was expected to worsen due to the Eurozone fiscal crisis, the meeting was held to listen early on to the concerns at SMEs in affected export sectors such as automotive, IT, and electronics and explain the Bank’s plans for support and assistance.
CEOs of Korea Eximbank Hidden Champion candidates such as Korea Fueltech Corporation, Partron Co. Ltd, Woory Corporation, and suppliers for large corporations such as Samsung Electronics, Hyundai Motors, and Kia Motors participated at the conference.
Chairman Yong Hwan Kim of Korea Eximbank commented, “Over the years, Korea Eximbank has augmented support provided by the commercial financing sector. To assist exporting SMEs facing tightened credit environments, Korea Eximbank will expand its trade finance volumes.“
Won Seok Oh, CEO of Korea Fueltech Corporation, stated at the conference, “Korea Eximbank’s expansion of trade finance during these tough times will be of great assistance for Korean SMEs which have the technology but not enough funding.”
At the conference, Chairman Yong Hwan Kim revealed three core strategies to strengthen trade finance.
First, the Bank will increase funding from USD 1.8 billion to USD 2.4 billion for rediscount on trade bills* to increase foreign liquidity of commercial banks and thus increase trade finance support for exporting SMEs.
This measure was taken in preparation against possible foreign liquidity shortages of commercial banks.
Rediscount on trade bills is a form of export finance support indirectly providing commercial banks with foreign currency by rediscounting trade bills that were issued on bills of exchange purchased by commercial banks.
The Bank also plans to roughly double the support provided by trade finance refinance* from last year’s KRW 600 billion to KRW 1 trillion.
* Trade finance refinance is a form of export finance support indirectly providing commercial banks with foreign currency by providing funding for trade finance loans.
In addition, Korea Eximbank will provide KRW 4 trillion in forfaiting* and KRW 4.8 trillion for export factoring** this year, an increase of KRW 1 trillion and 0.9 trillion, respectively.
* Forfaiting: the purchase of bills of exchange issued for L/C transactions without recourse to the exporter or previous holder
** Export factoring: the purchase of trade receivables from exporting firms issued for non-L/C transactions on a non-recourse basis.
Relatedly, the Korea Eximbank implemented the Global Pass Program, a shared growth initiative, last December to provide effective support to Korean SMEs exports.
The Bank plans to conclude MOUs for shared growth with 20 Korean conglomerates in major industries such as nuclear power plants, overseas construction, shipbuilding, and IT as well as provide KRW 1 trillion in financing to 5000 affiliated SMEs.
Prior to the meeting, Chairman Yong Hwan Kim visited Seojin Cam Co. Ltd. (Seojin Cam), in South Chungcheon Province.
Seojin Cam is a leading automotive parts manufacturer in Gyeonggi Province selected in 2010 for Korea Eximbank’s Hidden Champion Program.
Chairman Yong Hwan Kim commented, “Our economy will be able to overcome any crisis with technological leaders such as Seojin Cam. The Bank will endeavor to assist SMEs with great technological potential become global companies.”