Anderton forwards export credit plan

By DANIEL RIORDAN

Jim Anderton has handed Helen Clark his recommendations for an export credit guarantee scheme, which includes protection for exporters whose goods get caught up in armed conflicts.

But Mr Anderton, Deputy Prime Minister and Minister for Economic Development, says his actions do not preempt the findings of a more detailed report Trade NZ has been preparing for the Prime Minister since last year.

Helen Clark last week publicly berated the trade organisation for being too slow to develop an export scheme.

She said she was unhappy with the lack of progress made by Trade NZ, that she would like to see policy decisions made within the next three months and was not going to take no for an answer.

The northern division of the Employers and Manufacturers Association later joined the chorus of criticism, prompting Trade NZ chief executive Fran Wilde to defend her organisation.

Ms Wilde said Trade NZ was in the final stages of an extremely complex and detailed job and would submit a paper to the cabinet by the end of August.

"We need to do it once and do it right."

Denying he was on a collision course with Trade NZ, Mr Anderton said he had asked his ministry two to three months ago to examine the issue, unaware that Trade NZ had been working on it.

The ministry had enlisted the help of the Exporters' Institute, which is also working with Trade NZ on its report.

Mr Anderton said there were a number of major issues addressed in his report.

Along with insurance assistance for smaller exporters, one of the keys to filling the gap in the private sector insurance available to exporters was finding a way to protect New Zealand companies investing in long-term projects against the impact of war, or the unilateral actions of foreign Governments that might suddenly nationalise industries those companies were investing in.

Mr Anderton said his ministry's report to the Prime Minister included a proposal to overcome those risks, although he declined to give details.

He said his ministry was continuing to work with Trade NZ and the Treasury on the more detailed Trade NZ report.

Export credit insurance, already provided by several private-sector insurers, allows firms to cover the risk of sending their products overseas. Policies cover a percentage of the losses resulting from the buyer overseas going broke, failing to pay or refusing to accept goods.

The cost of the insurance is typically 50c for every $100 of the landed value of the exported goods. The insurance also allows firms to "discount" - take a bank loan against the value of an export consignment while it is in transit. That allows small firms with one large export order to pay salaries and keep afloat until the bill is paid.