ECIC IR 2023

Integrated Report 2023

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IDENTIFIED MATERIAL ISSUES The material issues, with our strategic objectives, are integral to the way in which we manage the implementation of our strategy and performance assessments. The Board concurs that the following material issues are salient to our business operations and most likely to cause risk for the Corporation, our shareholder, and key stakeholders. We describe the issues here, as well as their impact on our key stakeholders to either create or erode value. Amendment of the ECIC Act We are engaging with the dtic on the amendment of the ECIC enabling legislation to authorise ECIC to cover non-South African financial institutions. The proposed legislative change would have to be processed through Parliament; a process likely to be drawn out. Progress on ECIC expanded mandate Two transactions to the equivalent value of USD8,22 million were approved during the financial year: 1) Robertson and Caine – R130 million 2) RAM Shopfitting – R13,2 million Euro Policies insurance coverage Expanding the insurance coverage to Euro currency will help ECIC unlock opportunities for exporters and investors in regions where transactions are denominated in Euro currency. In addition, the repatriation of Euro currency in South Africa offers an advantage of diversifying the foreign currency reserves basket. New enquiries which are coming from Francophone countries can be supported to allow South African exporters to seize new opportunities in new markets. ECIC is an instrument in government’s hand to facilitate expanded trade and investments by SA companies. The Euro is gaining momentum in the international financial system. As demonstrated in comparative studies, the Euro dominates as a second currency after the US dollar, in terms of accumulated foreign exchange reserves; international debt issuances; international loans; foreign currency turnovers; and

global payment currency from countries that transact in both USD and Euro.

ECIC Thought Leadership The Corporation conducts research to identify potential trade and investment opportunities in countries and economic sectors, so that South African exporters and investors may take advantage of these opportunities, and by so doing, take advantage of the ECIC insurance support scheme. The following reports were finalised during the year: SME AfCFTA Awareness Survey Report Provides a snapshot on the state of awareness and knowledge by South African small businesses of the African Continental Free Trade Agreement (AfCFTA) and the impact the agreement will likely have on local SMEs. The report offers a view of the potential enablers and challenges to facilitating effective communication strategies on SME AfCFTA awareness and export trade across the 9 South African provinces. The outcomes from this survey are expected to give the ECIC guidance in terms of appropriate interventions from an export credit insurance perspective in terms of product development and other underwriting considerations. This will enable the Corporation to identify market gaps and support SMEs, accordingly, in export trade. ECIC Import and Export Research Report The main aim of the research was to understand the needs, challenges of business expansion, specifically the export/import market for SMEs in South Africa and its trading partners. This report answers the research objectives through unpacking: • Unpacking the barriers SMEs experience in terms of expansion, operational, financial, and informational challenges. • Understanding how the novel COVID-19 pandemic and great lockdown impacted SMEs. • Highlighting prospects and what SMEs need to flourish within the industry; and

YOUR EXPORT RISK PARTNER

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