City Research Online

Abstract

We assess factors influencing the demand for private reinsurance by public export credit agencies and export-import banks (ECAs), focusing on their specific characteristics. Supporting more than $2.5 trillion of payment risk protection for trade and foreign direct investment together with private actors in 2023, ECAs play a crucial role in bridging market gaps by offering trade credit insurance and investment guarantees, as well as equity and export financing. Our findings show that there is a strong relationship between reinsurance demand and the intervention principle, full faith and credit, managerial discretion, services of risk transfer and business diversification. The influence of regulation and financial strength is less clear. Our findings lead to the development of a framework outlining the contextual factors affecting the demand for reinsurance of public export credit agencies. This exploratory study contributes to existing theories of reinsurance demand and integrates practical feedback into the theoretical framework. Furthermore, it provides important recommendations for policymakers, public financial institutions and private actors supporting global trade and foreign direct investment.

Publication Type:	Article
Additional Information:	This article will be published in Journal of World Trade by Kluwer Law International and it will be available online at: https://kluwerlawonline.com/Journals/Journal+of+World+Trade/408
Publisher Keywords:	trade promotion, foreign direct investment, trade finance, export credit insurance, export credit agency, export-import bank, insurance demand, private reinsurance
Subjects:	H Social Sciences > HG Finance
Departments:	Bayes Business School Bayes Business School > Actuarial Science & Insurance
SWORD Depositor:	Symplectic Administrator

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