Export Credit Agencies, International Investment Law and the Spectre of Unsustainable Developing Countries' Debts

This article argues that the activities of Export Credit Agencies (ECAs), which provide political risk insurance to cover exports and foreign direct investments (FDIs), may be undermining the goals of Investor-State Dispute Settlement (ISDS). ISDS is supposed to limit investment disputes so that they are between the investor and host-state of the investment (investor-state disputes). However, since ECAs are quasi-governmental organisations that support FDIs, they can effectively elevate such investment disputes so that they are between the host-state and home-state of the investor (state-to-state disputes). This has implications for the necessity defence in international investment disputes, which is likely to feature in cases triggered by governmental measures taken in response to the COVID-19 pandemic. Further, the article argues that the activities of ECAs often precipitate unsustainable debt accumulation in developing countries. And these situations are becoming increasingly combustible because ECAs have escalated their activities to season investment programmes with foreign and geopolitical influence. This may worsen in the aftermath of the COVID-19 pandemic. The article concludes that increased transparency and a sustainability element in the activities of ECAs are essential to both expose these risks more broadly and to create a space under the canopy of international economic law for more sustainable growth from the understory of developing nations.

The main trends in the development of export credit agencies in the world

Subject. This article discusses the features and trends in the development of export credit agencies (ECA) in the world in the context of increasing competition of manufacturers for market share. Objectives. The article aims to show the peculiarities of the ECA's activities, reveal new aspects of their operation in modern conditions, and substantiate the need to change the international agreement in the field of export crediting and insurance. Methods. For the study, I used the comparative, statistical, and formal and logical methods. Results. The article shows the key role of ECA as an institution of State support for exports and a guarantor of the stability of the international trading system. It also finds that increased competition from Chinese and other ECAs that are not subject to the Arrangement on Officially Supported Export Credits – OECD rules, as well as the expanded role of ECA during the pandemic, necessitate uniform approaches to State support for exports of domestic producers at the WTO level. Conclusions. ECAs’ support remains one of the effective tools in implementing the State foreign economic policy and increasing the international competitiveness of certain sectors of the economy. The need to improve international rules on export credit and insurance to ensure the stability and sustainable development of international trade is becoming increasingly apparent.

Towards Net Zero export credit: current approaches and next steps

As the world economy rapidly decarbonises to meet global climate goals, the export credit sector must keep pace. Countries representing over two-thirds of global GDP have now set net zero targets, as have hundreds of private financial institutions. Public and private initiatives are now working to develop new standards and methodologies for shifting investment portfolios to decarbonisation pathways based on science. However, export credit agencies (ECAs) are only at the beginning stages of this seismic transformation. On the one hand, the net zero transition creates risks to existing business models and clients for the many ECAs, while on the other, it creates a significant opportunity for ECAs to refocus their support to help countries and trade partners meet their climate targets. ECAs can best take advantage of this transition, and minimise its risks, by setting net zero targets and adopting credible plans to decarbonise their portfolios. Collaboration across the sector can be a powerful tool for advancing this goal.

THE ROLE OF EXPORT CREDIT AGENCIES IN THE STATE`S TRADE POLICY FINANCIAL INSTRUMENTS SYSTEM

In the current context export crediting, insurance and guarantee of export credits as state stimulation financial methods of export production have become an organic part of the states` foreign trade policy realization mechanism. Providing state guarantees for an export credit is in many cases a primary condition for obtaining it. Therefore, the importance of state insurance in foreign trade is constantly growing, which, in turn, increases the reliability and efficiency of export operations. Export credit agencies are a highly effective institutional mechanism of state promoting policy. The main advantages and disadvantages of export credit agencies are analyzed. Models of export financing are offered and the cost with the involvement of the export credit agency is indicated. Taking into account foreign experience, the main factors hindering the process of forming an effective system of state financial support for exports are identified and the feasibility of creating a specialized institution to support export activities in Ukraine is justified. After all, with the development of market relations and integration into the European economic space, characterized by the intensity of foreign trade, which is manifested in increasing the number and volume of export and import operations, there is a need to identify and study new economic mechanisms of financial support.

Service Insurance as a Subject of Activity of Export Credit Agencies in the EAEU

This article discusses the role of development banks and export credit agencies in the EAEU and their comparative characteristics. The authors analyze functions and directions of export credit agencies in the EAEU particularly. The analysis showed export risks, which export credit agencies insured by providing various types of services.

Financing infrastructure in Asia through bonds and capital markets

The project finance scenario has changed significantly around the world after the 2008 financial crisis and following the subsequent Basel III recommendations. Project finance loans from commercial banks and financial institutions have largely dried up, leaving it mostly to the export credit agencies and the bilateral and multilateral development banks to provide the institutional credit. Unfortunately, those sources are not enough, given the huge needs for construction of new infrastructure and renovation of the old ones across Asia, Africa and Latin America. The need for capital markets, through market listed financial products across asset class, unlocking a large part of domestic and corporate savings, has never been felt as strongly before. This article seeks to analyze the development story of various Asian capital markets and examine financial products, which have succeeded in their short history in receiving investor interest. The article also delves into the challenges to market development, policy imperatives and the issues relating to market liquidity and credit rating, which are the most significant influencers for public market float and investor interest.