This is the sixth in a series of articles featuring Korea’s most prominent public entities, state-run organizations and government-backed corporations selected through surveys among experts. ― ED.
By Kim Tae-gyu
As soon as Korea Trade Insurance Corp. (K-sure) President Cho Kye-ryoong finished an opening ceremony for the year on Jan. 2, 2012 in Seoul, he flew to a small-sized firm in Gimhae, South Gyeongsang Province.
The company, which makes fishing hooks, welcomed his visit as it has greatly benefited from the state-run K-sure, which guarantees payments for export items for both large and small corporations.
``Our main export destinations were countries in Africa and South America that were regarded as risky places for exporters,’’ said a company insider, who asked not to reveal his or his firm’s identity.
``But we could advance into the countries beginning in the mid 2000s through shipping our items there thanks to the payment guarantee programs of K-sure. We still depend on the agency.’’
Even though importers default on their imbursements, the K-sure guarantees payments for exported items to subscribers of its services. The trade insurance has emerged as an alternative to the traditional letters of credit system.
The fishing hook maker also proactively took advantage of K-sure offerings to rack up fast growth via brisk international sales.
In 2006, the small start-up’s annual sales amounted to just 6.5 billion won but the figure more than doubled in five years to 15.5 billion won last year owing in no small part to K-sure services.
K-sure says that companies such as the one in Gimhae have played a pivotal role in Korea’s much-touted surge from economic backwater to one of the world’s top trade powerhouses.
Last year, the country became the world’s ninth country to chalk up more than $1 trillion in trade.
``We are determined to further support small-sized companies so that they can help the nation double its yearly trade volume to $2 trillion in the not-so-distant future,’’ a K-sure official said.
In particular, CEO Cho has spearheaded the initiative as demonstrated by creating the Trade Champs Club, a fraternity joined of smaller companies, which strive to export more than $100 million a year.
Its members get comprehensive support from K-sure from counseling to financing at lower interest rates than the market norm. It started in 2010 with 30 members and the figure jumped to 70 as of the end of last year.
``We at K-sure are dedicated to giving our best to overcome the current difficulties and leading the way for Korea to reach the $2 trillion trade volume with our knowhow and understanding of export insurance gained through our 20-year operational history,’’ Cho said on the firm’s Web site.
The Seoul-based organization debuted in 1992 as the trade insurer of Asia’s No. 4 economy as the Korea Export Insurance Corp. (KEIC). It changed the title to K-sure midway through 2010.