AFFECTED FLOWOutflow (subsidised)
ANNOUNCED AS TEMPORARYNo
On 17 December 2009, the European Commission approved an Austrian short-term export-credit insurance and reinsurance scheme with a maximum liability of 50 billion EUR.
The scheme may cover exports to countries the EC classifies as marketable risk countries, except for Luxembourg and New Zealand and will be provided through the Oesterreichische Kontrollbank AG, Austria's biggest financial provider for the export industry.
Furthermore, the programme will cover companies from all sectors (apart from financial institutions) which are not in difficulty and include a higher than private-market premium in order to encourage Austrian exporters to return to insuring their export credit in the private market as soon as possible. The exporter will also have to cover at least 10% (but normally 20%) of the related risk. For reinsurance, these thresholds will be 20% and 30% respectively.
Austria argued the scheme was necessary, as "in the context of the current financial and economic crisis, it is assumed that the premiums have increased by 40 - 90 basis points p.a. depending on the underlying risk profile. The estimate for withdrawal of insurance coverage of private credit insurers in Austria is up to 15-30%. Therefore, private credit insurers are decreasing or cancelling credit limits agreed with exporters, even if this reduction in availability is not justified by an increase in the underlying risk of the insured operations." (par. 8, letter from the EC to Austria, 17.12.2009)
The scheme was in force until 31 December 2010.
The list of potentially affected trading partners and tariff lines is based on Austria's bilateral export flows in 2008 with the countries the EU classifies as marketable risk countries (i.e. either OECD or EU member states).
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