LCI took part in the official conference hosted by GIG Egypt and the Ministry of Trade and Industry in March, 2019. The aim of the conference is to strengthen investment and collaboration opportunities between Egypt and Syria. LCI’s General Manager, Karim Nasrallah, shed light on the innovation in trade receivables management, to drive trade globally.
Every day, fleets of huge ships dock in ports over the world and every hour, a plane carrying cargo lands, in one country or another. With every docking and landing, a stack of paperwork will need to be processed. Whilst this practice has been the standard process adopted by governments and countries for decades, the cost of processing trade documents still remains high.
Based on figures released by the World Economic Forum, the cost of processing the paperwork for shipped goods, can reach as much as one fifth of the cost of shipping the actual goods. Many institutions, including banks and technology companies, are trying to streamline this process, as the benefits are numerous. Experts indicate that simplifying the administrative procedures can actually lead to notable growth in international trade.
Apps, technological innovation & block chain solutions are simplifying procedures of shipping goods.
In comes digitization, which is already underway in the trade sector. Apps, projects, technological innovation and even block chain solutions are simplifying the once complex administrative procedures of shipping goods. Electronic-based documentation lowers costs, simplifies workflow, and takes up less time in terms of analysis and storing. Depending on the electronic documents along with the use of standardized ID numbers for transactions, traders can benefit from a smoother process, expand to new markets and deal with new clients, with less requirements when it comes to due diligence, collecting and tracking credit, performance and commercial dispute data.
The advantages of digitizing the trade sector
are clear, but will governments and private institutions move fast enough?
TAJER: The simplified trade credit insurance policy helps support SMEs in their growth and expansion strategies
The Lebanese Credit Insurer (LCI) has launched TAJER, an innovative, simple and efficient credit insurance policy for Small and Medium-sized Enterprises (SMEs) operating across the MENA region, providing cover for their trade receivables. Utilizing LCI’s expansive market intelligence, including the active monitoring of 16,000 companies focusing on their payment behaviors, TAJER will aid SMEs in growing their businesses and ensuring they get paid for the goods and services they supply.
“SMEs make up a major part of the MENA region’s economy, and in Lebanon, they comprise an estimated 80% of companies. Yet, only a small percentage of them are covered against the risks of non-payment,” said Karim Nasrallah, General Manager of LCI. “As such, we want to support them in their expansion into new markets and in growing their client portfolios. TAJER gives SMEs the confidence to look at new opportunities in their local markets and abroad, and focus on their growth,” he added.
The Middle East and North Africa (MENA) region has undergone a series of transformations in recent years, impacting the way businesses operate. LCI’s Risk Department market analysis shows that the risk of payment defaults is increasing, impacting the trade receivables of companies across the region. The highest risks in the market are impacting SMEs, rather than by bigger corporations, especially as they expand their market coverage and export to the different parts of the world – a move needed to optimize revenues and generate profits.
SMEs in Lebanon, as well as in most markets globally, employ the majority of the workforce, and play a major role in creating job opportunities. They are the institutions that fuel the economy. Lebanon is known to have one of the biggest densities of established business owners, not only in the MENA region, but even globally, based on official figures.
Seeing that there is a scarcity of available information (financial and other), the only way for credit insurers to underwrite risk is to conduct research via on-ground visits to companies, to understand, based on their sector experience, what is the potential opportunity and credit worthiness of each entity. Monitoring is also segmented by sector, trade size, company size and country location.
With TAJER, the straightforward and flexible insurance policy covering a company’s biggest asset, its trade receivables, many benefits will be offered which include:
Increase sales, by extending credit limits to existing clients and reconciling between the sales and risk departments
Manage risks, by accessing a large database of information and intelligence on thousands of companies
Be more competitive, by extending payment terms for new and existing clients
Protects against bad debt, by securing cash flow and optimizing financial planning
Achieve better borrowing from banks, turning trade receivables into good quality collaterals, allowing companies to negotiate better borrowing terms
adminLCI launches TAJER supporting SMEs, the main drivers of the MENA region’s economy
The trade war between the US and China has been making global headlines in recent months. The headlines then turned into action, with the US implementing a 25% tariff on Chinese exports, worth billions of US Dollars. China responded with a similar approach – and the trade imbalance between the two countries became even more evident.
The world’s two largest economies found themselves in a trade war, which many economists say, will negatively impact the GDP of both countries and will slow trade growth in the long-term.
However, as the world watches on as the two nations battle it out publicly, some experts are analyzing the potential impact of the trade war, on the Middle East. When it comes to the MENA region, whilst the trade war seems like a distant battle, repercussions are already surfacing.
Countries in the MENA region may be forced to take sides, fueling the trade war further. In addition, as the US and China advance further into their battle, they may adopt a protectionist approach, to safeguard their country’s industries. This will lead to a decreased demand for goods from Middle Eastern markets, such as the oil exports from the region into China.
The full extend of the trade war between the US and China is yet to be seen and felt. Let’s hope that an amicable solution is found, before the trade industry is disrupted completely.
admin[Blog] How is the ongoing trade war impacting the MENA region?
LCI and SACE have signed a cooperation agreement, to enhance trade opportunities between Lebanon and Italy by supporting SMEs. The expertise and know-how of both entities will be extended to SMEs, along with training programs and technical assistance offered to financial institutions and commercial banks, as result of this agreement.
SMEs make up the majority of business institutions in both Italy and Lebanon, employing a large proportion of the national workforce. Thus, supporting their growth and enhancing trade opportunities, through trade credit insurance and the sharing of expertise, contributes towards a more prosperous economy.
The Lebanese Credit Insurer (LCI), has appointed Dominque Charpentier as its new Chairman at its Annual General Meeting held in May, 2017.
Charpentier led a seasoned career with extensive experience in the realms of finance and credit insurance, having held senior financial positions in corporations, namely CFO of SCOA and PINAULT Groups and then moving on to become Deputy CEO of Société Marseillaise de Crédit. In 1995, Charpentier ventured into the Credit Insurance industry, within the Euler Group where he was successively Deputy CEO of Cobac Benelux, CEO of Société Française de Factoring and CEO of Eurofactor. In 2002, he moved to Atradius Group, assuming the role of Managing Director of several divisions of the Group: Atradius Factoring, Atradius Bonding, Atradius Instalment Credit Protection and Atradius Credit Insurance Italy.
He then joined the Management Board of Atradius as Chief Insurance Operations Officer in 2013.
Throughout his career, he held numerous Board member positions in professional organizations across Europe, of which: In France, as Director of Association des Sociétés Financières (ASF); in Belgium as Director of Beroep Vereniging van het Krediet (BVK), and on an international level as Director and Chairman of International Factors Group (IFG).
In January 2017, Charpentier retired, and now serves as Chairman of the Supervisory Board of Graydon Holding NV in the Netherlands and has been newly appointed as the Chairman of LCI.
Charpentier graduated from Institut d’Etudes Politiques de Paris.
In his capacity as Chairman of LCI, Charpentier will bring his wide experience to support the company in implementing its growth strategy and in its development and expansion. Charpentier succeeds Gerard van Brakel who has been chairing LCI since it was founded in 2001.
adminLCI appoints Dominique Charpentier as its new Chairman
It is to an evolving and challenging geopolitical environment that LCI had to quickly adapt and change the way we are operating in the Middle East.
Markets are volatile and more and more interconnected, companies of all sizes are exposed to growing risks.
For over 15 years, our portfolio has been steadily growing, and we have been closely observing our clients’ businesses expand across geographies. Concurrently, we have been eyeing new markets to venture into, diversifying and tailoring our services to cater to local needs.
In such unpredictable times, what we can do is focus on innovation in our business, offer new tailored solutions for the changing marketplace, as well as diversifying our spread of risk, to create a well-balanced portfolio. That is what our current strategy is based on and our commitment remains to be a driving force in trade facilitation across the MENA region, primarily by ensuring and protecting companies and their trade receivables.
GM of LCI
Letter from the Chairman
As the new Chairman of the Board of LCI I am honoured to succeed Gerard van Brakel, who has pioneered credit insurance in this part of the world.
Credit insurance has been created to manage the risks related to trade and especially international trade between companies. It is a very concentrated industry at an international level, but leaves room for smaller, highly specialized players. LCI has been one of them for more than 15 years, covering specific markets in Lebanon and the Middle East.
Created as a result of strong shareholders putting together the competences of one of the world’s leading credit insurers, Atradius, and the knowledge of regional actors, supported upwards by an extended network of information providers and downwards by the reinsurance world, LCI has set up solid and experienced teams who have developed an original business model. This model is very well adapted to the markets LCI is operating in, delivering customized credit insurance solutions to local and regional companies, characterized by a high level of professionalism and standard of service quality. The model is so performant that it proved to be efficient beyond the Middle Eastern region, as was demonstrated in the Balkans.
It can, as well, be the platform for the credit insurance of tomorrow. Indeed, the world is changing rapidly, new forms of trade enter centre stage, and credit insurance will have to adapt as a result. I have no doubt that LCI’s team has the capacity to meet this challenge, and come out with modern and efficient solutions for its clients to trade safely, under both traditional and new forms.