EXIM Thailand adopts an offensive role in realizing its vision of strength and prominence in financial services as well as in response to the public promotion policy for exports and Thai investments abroad. The Bank's objective is to create and develop exporters and Thai businesses so that they will engage in ever larger international trade and investment volumes. This will in turn help to lay a foundation for Thailand's sustainable economic development in the long term. To achieve such goals, the following implementations have been accomplished or are under way:
1. International Trade Promotion
One primary mission of EXIM Thailand is to boost the value of Thailand's international trade by targeting exporters with strong potential for export expansion, strengthening SME exporters, as well as creating brand new exporters and export items.
Moreover, the Bank also aims to incubate and enhance trading companies engaging in value creation replacing foreign production sub-contracting of the past. Here, the strategy also visualizes domestic market development for SMEs. Export promotion measures undertaken by the Bank are detailed below:
1.1 Export Credit Facilities
EXIM Thailand provides a comprehensive option of export financing, ranging from pre- to post-shipment working capital financing which includes a broad range of facilities such as Pre-shipment Financing, Express Export Credit, Pre-shipment Financing for Small- and Medium-sized Enterprises, Export Supplier's Credit, Packing Credit Plus, which provides a revolving credit line plus export credit insurance benefits to enhance Thai exporters' confidence in their new market expansion. For medium- and long-term credit, EXIM Thailand also makes available credit facilities for factory expansion, trade exhibition and maritime businesses. The Merchant Marine Financing Facility aims to promote Thai commercial shipping fleets and alleviate the country's current account problem.
1.2 International Trade Payments Facilitation
EXIM Thailand has fostered ties with a network of correspondent banks covering a larger number of countries than any other financial institutions in Thailand. In addition to the direct facilitation of trade and payments for exporters, this networking also provides indirect benefits of export diversification, lowering Thailand's dependence on traditionally primary markets which are marked by severe competition as a result of increased non-tariff barriers imposed by these countries. To further facilitate and solidify confidence of exporters in both new and conventional markets, EXIM Thailand has also introduced the following services:
1.2.1 Bilateral Payment Arrangements (BPAs) or Account Trade
has been introduced to boost exporters' confidence in the payments receipt prospects and facilitate international trade settlement while lowering reliance on the use of hard currencies. Under this arrangement, EXIM Thailand is designated the Representative Bank of Thailand responsible for international account settlements with other member countries by netting Thai importers' bills with exporter's account receivables at pre-specified intervals such as 3 or 6 months. The owing representative banks then settle for the differences with interest in the currency that was previously agreed upon. Following its talks with foreign countries since 2002, EXIM Thailand has successfully entered into the BPA agreements with the Government Appointed Banks in Malaysia and Bangladesh. Meanwhile, BPA agreements with North Korea, Pakistan, Zimbabwe, Indonesia, the Philippines, Papua New Guinea, Laos and Cambodia are under negotiation.
1.2.2 L/C Confirmation Facility
has also been introduced to expedite and boost exporters' confidence in the case where buyers reside in unconventional markets. This facility is further divided into unilateral and bilateral L/C confirmation and discounting services.
1.2.3 Revolving Trade Finance Facility
is offered by EXIM Thailand to buyers in emerging markets through their respective banks to enhance Thai exports potential. Thai exporters, when receiving an L/C at Sight from these buyers through EXIM Thailand's correspondent banks, may present this L/C for cash proceeds from EXIM Thailand at full face-value on the date received. While exporters receive their cash immediately, EXIM Thailand, on the other hand, will not collect payment from the buyers until the expiration of the period as agreed with the correspondent banks. To date, the Bank has already entered into this arrangement with correspondent banks in Russia and is under negotiation with banks in other countries.
1.3 Export Credit Insurance
EXIM Thailand is the first bank in Thailand to offer this protection against the risks of non-payment by buyers or their representative banks in over 200 countries worldwide. This service aims to encourage exporters to diversify from traditional to unconventional markets by enabling them to offer more lenient terms of payments to buyers in these new markets. Here, exporters may select from different types of insurance to suit their specific requirements, i.e. (a) Short-term Export Credit Insurance for exporters with account receivables to be collected within 180 days under various terms of payments including Documents against Payment (D/P), Documents against Acceptance (D/A), Open Account (O/A) and Letter of Credit (L/C). Under this facility, EXIM Thailand will compensate for losses arising from commercial or political risks at the rate of 70 to 90 per cent of loss realized. (b) Medium- and Long-term Export Credit Insurance is available for export of goods or services under the payment periods of 180 days or longer.
1.4 Competitiveness Enhancement in the Global Arena
To enhance competitiveness and strength of Thai exporters in the world markets, EXIM Thailand also offers consultation services to traditionally domestic proprietors and SME exporters lacking knowledge or experiences in international trade. This includes training sessions and seminars on conducting export businesses, investments abroad, prospects of export markets and other topics deemed to be beneficial for the business development of a new generation of exporters.
2. Promotion of Thai Investment Abroad
Since its inception in 1994, EXIM Thailand has continued to support Thai businesses with potential and readiness to invest or engage in overseas operations. In addition to the working capital and long-term loans, EXIM Thailand also issues various types of guarantees for construction projects abroad along with project financing.
In supporting Thai investors abroad, EXIM Thailand places high priority on comprehensive networking with various public agencies, e.g. Ministry of Foreign Affairs, Ministry of Commerce and Office of the Board of Investment (BOI). EXIM Thailand sets as its goal to ensure that the Thai private sector will benefit from the various trade and investment opportunities that have been opened up by various Government-initiated Economic Cooperations. These initiatives include the Free Trade Agreement (FTA), Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS) as well as other government promotion schemes for various industrial or service sectors with strong potential such as Kitchen of the World, Contract Farming and Industrial Relocation to Neighboring Countries. The latter dual scheme aims to make use of trade opportunities and raw materials available in neighboring countries, alleviate migration problem and enhance economic development in these countries at the same time.
3. Neighboring Economic Development and Collaboration
To assist in the economic development of neighboring countries and strengthen Thailand's relationship with them, EXIM Thailand provides loans to governments and public agencies under more lenient terms conditional upon the purchase of Thai goods or services. Under this program, EXIM Thailand customarily provides loan drawdowns directly to Thai firms.
Among the various Thai-international cooperation efforts upon which EXIM Thailand has placed special emphasis are Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS), Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) and Greater Mekong Subregion (GMS).
Along with the Government initiatives above, EXIM Thailand has at the same time pioneered and continued to develop and strengthen the Asian Bond market, aiming specifically for Thai investors abroad or foreign governments in the neighboring countries.