The Berne Union, the global association for the export credit and investment insurance industry, reports that its market shows “strong growth” in business lines in 2022 and a decrease in claims paid in overall.
Looking at the data, analysts concluded that export credit remains “well positioned to adapt and change” as the industry readjusts to the aftermath of the pandemic and the war in Ukraine.
“Our industry has shown great resilience and adaptability throughout the pandemic and now, as we emerge from it, we must continue to innovate, to support exporters in a new environment for risk , which will present our industry with both challenges and opportunities,” commented Berne Union President, Maëlia Dufour.
Highlights from the year’s data show that the export credit industry supported $2.83 trillion in cross-border trade and investment with an additional $68.6bn in non-cross-border support for exporters.
After the reduced activity after the pandemic, the MLT business has also returned to strength, reaching more than $130 billion for the year, only 5.9% below the level of 2019.
The Berne Union said that growth was supported by the return of significant transactions in the transport sector as well as a large project expansion in the manufacturing sector.
Renewable energy transactions also continue to increase and nearly double 2019 levels, while commitments for natural resources continue to decline now at just 33% of their 2019 levels.
Growth in new business was seen especially in Europe, East Asia Pacific and North America which together accounted for 63% of total new business.
For the ST business, all sectors have seen an increase in activity with a notable jump in transactions for energy commodities as energy markets change in the fall of the 2021-2022 crisis in world energy. Here, unlike MLT, growth is driven by business growth in the MENA region as trade shifts to shorter-term products for this region.
In addition, the Berne Union reported that the total claims paid fell from $ 9 billion to $ 7.6 billion in 2022, after a notable decrease in MLT transport claims that spike in the early stages of the pandemic.
Despite relatively poor claims in 2022, members’ expectations are that they will increase until 2023, as insolvencies normalize amid rising costs and growing political risk.
“However, the industry remains well-equipped with a sustained risk appetite,” Berne Union concluded. “Overall, 2022 will be a strong year for the recovery, reflecting the industry’s adaptability and resilience over time as members of the Berne Union continue to support the effective functioning of global trade. “