EGAP Conference 13 September 2007 Berne Union and Prague Club Kimberly Wiehl SECRETARY-GENERAL EGAP Conference 13 September 2007

Berne Union and Prague Club Long term business trends Berne Union Members‘ New Business

EGAP Conference 13 September 2007 Berne Union and Prague Club New business covered (USD billion) Short Term969 Medium/Long Term130 Investment 42 Total 1,141 Premium income (USD billion) Short Term 2.3 Medium/Long Term 3.6 Investment 0.6 Total 6.5 New Business & Premium 2006

EGAP Conference 13 September 2007 Berne Union and Prague Club Claims and recoveries in 2006 Claims paid (USD billion) Short Term 0.8 Medium/Long Term 1.9 Investment 0.1 Total 2.8 Recoveries received (USD billion) Short Term 1.1 Medium/Long Term 31.6 Investment 0.1 Total 32.8

EGAP Conference 13 September 2007 Berne Union and Prague Club Claims & recoveries vs. premium

EGAP Conference 13 September 2007 Berne Union and Prague Club 1934: First meeting of the Berne Union with 4 members (public and private) 1993: First meeting of the Prague Club. Supported by funding from the EBRD. 2001: Pavol Parizek of EGAP elected as the first Chair of the Prague Club. Followed by Malgorzata Rutkowska (KUKE), Vida Zabukovec (SID) and Csaba Simon (MEHIB). 2007: Prague Club has 14 CEE members, 11 from Africa/Middle East/Asia including 3 multilaterals. 2007:Berne Union and Prague Club together are 70 members insuring 10% of total world export trade The BU and Prague Club

EGAP Conference 13 September 2007 Berne Union and Prague Club Prague Club: Business volumes Prague Club New Export Credit Business (USD millions)

EGAP Conference 13 September 2007 Berne Union and Prague Club New business covered (USD million) Short Term16,859 Medium/Long Term 3,042 Total 19,901 Change+35.5% Premium income (USD million) Short Term 51.3 Medium/Long Term 97.6 Total Change+39.6% New Business & Premium 2006

EGAP Conference 13 September 2007 Berne Union and Prague Club Claims (USD million) Short Term30.2 Medium/Long Term40.7 Total 70.9 Change +22.7% Recoveries (USD million) Short Term 6.0 Medium/Long Term49.6 Total55.6 Claims and recoveries 2006

EGAP Conference 13 September 2007 Berne Union and Prague Club Original aim to provide technical expertise to support institution building of ECAs to promote national exports. Rapid expansion of membership as new ECAs could join even before having written any policies. Strong growth in ST insurance – followed by developing business in MLT and INV areas. Foreign competition enters the home markets – both domestic and export business. Cooperation agreements activated to risk share in transactions. Operating on a commercial basis from an early stage – reinsurance, capital management and now, privatisation. PC Developments

EGAP Conference 13 September 2007 Berne Union and Prague Club Competition – more market players – more pressure on pricing. How to maintain market share? Adapting to EU regulations on marketable risks. SME clients – how to meet their needs on a cost effective basis? New products – expansion into new types of business. Working with banks – maximise opportunities for financing capacity. Impact of Basel II. Risk assessment and pricing models. Portfolio and capital management. Using technology effectively to streamline administration, underwriting, client communication. Issues and Trends

EGAP Conference 13 September 2007 Berne Union and Prague Club Value Statement “We are committed to operate in a professional manner that is financially responsible, respectful of the environment and which demonstrates high ethical values - all in the best interest of the long-term success of our industry. ” Sound Principles “… to work for the international acceptance of sound principles of export credit … (and) foreign investment insurance …” Interaction ”… to provide for the exchange of information, assistance, expertise and advice …” (i.e. providing members with a forum for co-operation & professional interaction) What do the BU and PC stand for?

EGAP Conference 13 September 2007 Berne Union and Prague Club 1.We conduct our business in a manner that contributes to the stability and expansion of global trade and investment on a sound basis, that is, in accordance with applicable laws and relevant international agreements 2.We carefully review and manage the risks we undertake 3.We promote export credit and investment insurance terms that reflect sound business practices 4.We aim to generate adequate revenues to sustain long-term operations reflective of the risks we undertake 5.We manage claims and recoveries in a professional manner, whilst at all times, recognising the insureds’ and obligors’ rights 6.We are sensitive about environmental issues and take such issues into account in the conduct of our business. BU and PC Guiding Principles

EGAP Conference 13 September 2007 Berne Union and Prague Club 7.We support international efforts to combat corruption and money laundering 8.We promote best practices through exchange of information on our activities, policies and procedures and through the development of relevant agreements and standards, where these are deemed necessary to govern the provision of export credit and investment insurance 9.We are committed to furthering transparency amongst members and in the reporting of our overall business activities, reflective of international practices and respectful of the confidentiality of third party information. 10.We encourage co-operation and partnering with commercial, bilateral, multilateral and other organisations involved in export trade and investment business. BU and PC Guiding Principles