credit agencies may be provided as: 1) "pure cover", i.e. insurance or guarantees given to exporters or lending institutions without financing support; 2) financing support, i.e. direct credits/financing, refinancing and interest rate support, and/or 3) aid financing, i.e. credits and grants.
In the European Union, short-term credits have been mainly privatised. A Communication of the European Commission to the EU Member States effectively stipulates that official export credit support should not be provided for "marketable" risks (EC, 2001). As a result, EU countries do not generally provide export credits for intra-EU trade or trade with most other OECD countries paid for under short payment terms (normally cash up to two years) for either large or small firms. For example, in the Netherlands, short-term business with smaller firms is carried out by the company Gerling NCM rather than the government. Several European countries do provide export credits to SMEs for medium and longer-term payment periods. However, short-term business, which generally concerns raw materials, commodities and manufactured goods, is more likely within the realm of smaller firms than medium- and longer-term business, which is generally capital goods and large business projects.
Several non-European countries have specific targets for export credits extended to small exporters. These can be in terms of the SME share of export credits, the SME share of customers served or the number of small firms supported. The mandate of the US Eximbank requires that 10% of their budget must be devoted to supporting SME export credits. Mexico allocated USD 3.5 million for SME export credits in 2001. Canada (EDC) issues an SME Scorecard on its progress in meeting SME targets, which include the number of SME customers served, number of new emerging exporters and average time for turnaround for SME credit approval requests. Like Canada, the SME targets for Korea's K-EXIM are publicly available through its Annual Plan. EFIC of Australia sets an annual target for short-term export credit insurance operations based on the volume of credits for SME exports
In some OECD countries (e.g. Canada, Korea, Mexico and the United States), SME exporters have represented more than 70% of the number of short-term transactions or customers in recent years. Larger countries such as the United States and Canada tend to serve a large number of SME customers, but their share of total credit value is far less.
In 2001, approximately 4 300 Canadian small exporters used short-term credits, representing 24% of total credit value; while 460 Canadian small exporters received medium-term credits, representing 7.4% of total credit value. Korea's K-EXIM provided more than 1 000 small exporters with USD 670 million in short-term credits, while only 2 small exporters received medium/long-term credits in 2001. This represented 17% of the value of Korean short-term credits compared to only 0.4% of medium- term credits. In the United States, there were nearly 1 800 short-term transaction for SMEs compared to about 330 medium/long-term transactions in 2001, accounting for 14% and 3.6% respectively of total credit value.
Designing special products for small exporters
In many countries, small firms are the major clients of export credit agencies, which do not have a special category of products designed for SMEs. However, some export credit agencies are designing export-related products and services with the special needs of small exporters in mind (Table 2).