Export Insurance Agency of Armenia and Union of Banks of Armenia sign memorandum on cooperation

ArmInfo. Export Insurance Agency of Armenia (EIAA) and Union of Banks of Armenia signed memorandum on cooperation. To note earlier the EIAA has signed memorandums with ArmSwissbank and ACBA-Credit Agricole Bank.

Chairman of the Union of Banks of Armenia Samvel Chzmachyan noted that this memorandum will create new opportunities for export; particularly will raise accessibility to financial resources without collateral for the economy entities and will allow minimizing the risks. "In my opinion the banks of Armenia will benefit from cooperation with EIAA, which will first and foremost be good for Armenian economy", Chzmachyan said noting that due to combined efforts the procedures of export of Armenian products will be simplified.

In his turn Executive Director of the EIAA Vazgen Abgaryan noted that compared to financial instruments aimed at reducing exporters' risks initiated earlier by the banks EIAA has certain advantages. According to him key advantages are insurance contract without the third party-the purchaser and lower tariffs on insurance premiums. " Insurance premiums established by the EIAA which hover around 0.3% and 0.6% depended on the contract scope, testify that we do not want to create additional burden for our exporters, as the agency's main mission is to stimulate export", Abgaryan stated. At the same time the expert expressed hope that in the nearest future due to combined efforts the products on export insurance will have great demand in Armenia and will contribute to increase of competitiveness of Armenian exporters.

In a talk to ArmInfo's correspondent Abgaryan informed that it is planned to sign a memorandum on cooperation with one more Armenian bank this month. "I think we will manage to sign 8 more memorandums by the end of the year. We are open for cooperation with the banks that want to work towards trade financing", he summarized.

To note, Export Insurance Agency of Armenia Insurance CJSC was founded on October 23th, 2013 by the decision of the Government of the Republic of Armenia within the framework of the export- oriented industrial policy. The Company provides insurance against the financial losses incurred as a result of non-payment for supplied goods by the Foreign Buyer or its Bank, which has a payment obligation under the Contract.

According to the National Statistical Service of Armenia in Q1 2016 deficit of trade turnover balance of Armenia declined by 23% y-o-y and totaled 428.7 mln USD, which is caused by growth of export by 22.2% to 514.5 mln USD amid drop of import by 3.5% to 943.2 mln USD. Thus, trade turnover grew by 4.2% and totaled 1.458 bln USD. At the same time growth was registered to all directions: with the CIS by 8.1% to 450.4 mln USD, with other foreign countries by 4.2% to 652 mln USD, at the same time turnover with the EU declined by 0.1% to 355.2 mln USD. Export to CIS countries grew by 72.1% amid drop of import by 3%. Export to the EU grew by 11.3% amid drop of import by 7.1%.