Polish exporters are getting help and it is needed because Russian aggression against Ukraine makes it impossible to sell Polish products to Russia, Ukraine and Belarus. This is a serious problem, because sales to these three eastern markets totaled approx. 6 percent of Polish exports in 2021
In these circumstances, Korporacja Ubezpieczeń Kredytów Eksportowych (KUKE), which introduced an export support system last year, and the Industrial Development Agency (ARP) signed a cooperation agreement to jointly offer Polish companies financial solutions in order to strengthen their ability to compete on domestic and foreign markets.
The range of available instruments for entrepreneurs supported by IDA includes various types of guarantees and insurance, including financing of domestic investments generating exports, as well as working capital financing.
Polish exports in euro increased by 13.5 percent
“In such a demanding environment, Polish entrepreneurs are doing very well, it is enough to recall that in January our exports in euro increased by 13.5 percent. Every year. However, they face more and more serious challenges, including a consequence of Russia’s invasion of Ukraine and macroeconomic phenomena, such as high inflation resulting in ever higher interest rates on loans, rising labour costs, and difficulties in accessing components and materials due to disrupted supply chains.
In this situation, we agreed with KUKE on the terms of cooperation and the possibility of supporting entrepreneurs with pro-export aspirations” says Paweł Kolczyński, vice president of ARP.
In recent months, KUKE has signed agreements with six domestic and one foreign banks on the provision of instruments from the export support system.
“We already have effects in the form of signed and negotiated agreements on guaranteeing financing of domestic exporters by banks. In the current situation of increased risk and increased uncertainty, such support from KUKE is even more necessary for financing institutions to be bolder in providing funds for the operation and development of Polish entrepreneurs focused on the internationalisation of their business.
At the same time, we are pleased with the further tightening of cooperation within the Polish Development Fund group and that ARP is the first non-banking entity that will use our solutions for exporters” emphasises Janusz Władyczak, President of KUKE S.A.
“Our cooperation so far focused largely on the domestic market, including between IDA and our subsidiary KUKE Finance in the field of offering factoring solutions, is going to a higher level”, adds the head of KUKE, which recently also participated in the Polish-African Economic Forum in Dubai promoting KUKE instruments there in cooperation with African countries, incl. with Nigeria being the most populous African country (215 million inhabitants).
As the experts from ARP and KUKE jointly indicate, it can be expected that the most frequently used solutions by domestic entrepreneurs will be guarantees of financing domestic investments generating exports and guarantees of working capital provided to exporters by IDA.
The solutions from the export support system bring benefits to both exporters and their financing institutions, which, using KUKE counter-guarantees, secure up to 80 percent. commitment, may increase the level of customer financing. As a result, exporters are able to invest more in the development of production potential and intensify external expansion.
Polish exporters goods totaled over 285.8 billion PLN
Last year, Polish exports of goods totaled over 285.8 billion PLN. In turn, imports over 286.3 billion EUR. European markets remain the main direction of our exports. About 80 percent of the total is sold to other EU countries..
Source: Rzeczpospolita
