Daegu City Strengthens and Renews Corporate Export Safety Net 'Short-term Export Group Insurance'

For 2,557 Companies with Export Amounts Below 10 Million USD

Hyundai Motor Company shipped 10 units of the 'Xcient Hydrogen Electric Truck,' the world's first mass-produced large hydrogen electric truck, from Gwangyang Port in Gwangyang City, Jeollanam-do, on July 6, and exported them to Switzerland.

[Asia Economy Yeongnam Reporting Headquarters Reporter Park Dong-wook] On the 19th, Daegu City announced that it has raised the loss compensation limit and renewed the contract to secure an export safety net in response to external changes such as the novel coronavirus infection (COVID-19). Daegu was the first in the nation last year to subscribe to a short-term export insurance through a bulk enrollment method.

This contract was promoted by enrolling all 2,557 small and medium-sized enterprises (SMEs) with export performance of less than 10 million USD as of the end of June in Daegu as the contracting party for the short-term export insurance.

In particular, this year, the previous method of dividing into four grades according to export performance and setting compensation amounts accordingly was changed to integrate the grades by dividing export performance into less than 100,000 USD and 100,000 USD or more, with compensation within an annual limit of 20,000 USD or 50,000 USD. Accordingly, the compensation amount for companies with export performance of 100,000 USD or more but less than 5 million USD has been expanded.

Among the total 2,557 beneficiary companies, the number of companies benefiting under the revised compensation criteria is 1,396 for the annual 20,000 USD limit compensation and 1,161 for the annual 50,000 USD limit compensation. It is estimated that about 1,128 companies will benefit from this grade integration.

The existing group insurance targets companies with annual export performance of less than 50 million USD, and the companies submit applications directly to the Korea Trade Insurance Corporation for approval. Daegu City, in response to the intensification of protectionism such as the US-China trade conflict, subscribed to group insurance for SMEs for practical public insurance coverage for the first time nationwide in July last year. As a result, it has been evaluated as a strong shield for companies affected by Japan's import restrictions on Korea in July last year and export-import damages caused by the COVID-19 outbreak this year.

Kim Tae-woon, Director of the Job Investment Bureau of Daegu City, said, "We will continue to support small and medium-sized enterprises struggling with exports due to COVID-19 and export novice companies vulnerable to export risk management, protecting them from risks such as non-payment of transaction funds and actively helping them to develop sales channels."

This content was produced with the assistance of AI translation services.