Export success relaunches economy
THANKS TO THE PIONEERING WORK OF ASURANSI EKSPOR INDONESIA (ASEI) AND BANK EKSPOR INDONESIA (BEI), THE INDONESIAN INDUSTRIAL SECTOR IS CURRENTLY ENJOYING A RESURGENCE

SUPARDI President of Asuransi Ekspor Indonesia (ASEI)

As Indonesia’s economy struggles to get back on its feet, the country is betting on its small and medium enterprises–not only as the long term future of the Indonesian economy but also as a short term financial source to support the nation’s recovery.
Exports, for example, and in particular non-oil and gas exports, are now in an important position to generate much needed foreign exchange income.
With the banking sector preoccupied with restructuring and the level of foreign investment recently unoptimistic, small businesses have needed to look elsewhere for resources. Enter Asuransi Ekspor Indonesia (ASEI) and Bank Ekspor Indonesia (BEI), two state-owned companies dedicated to supporting and expanding Indonesia’s export industry. Explaining the distinct functions of each agency, ASEI President, Supardi, states, “ASEI specializes in protection products such as export credit insurance and export credit guarantee, whereas BEI is mainly concerned with refinancing. As both organizations have similar missions–to support the enhancement of non-oil and gas exports, we maintain a close relationship through introducing each other’s core products to the exporters and to commercial banks.”

BANK EKSPOR INDONESIA’s financing, guarantee and advisory services have given Indonesia’s export sector a substantial lift.

ASEI, founded in 1985, is a pioneer in export credit insurance in Indonesia. According to Supardi, the agency’s commitment from its founding to date has been the improvement of Indonesian exporters’ competitiveness in the international market. Through the removal of payment risk, the agency is able to encourage exporters to penetrate new markets. ASEI also offers a working capital credit insurance facility for commercial banks in order to increase their export financing facilities, as well as surety bonds. In order to fulfill its role to the best of its ability, the agency places great importance on organizational improvements. “Internally, we are constantly upgrading our product and organizational structure, increasing the professionalism of our human resources, increasing our capital and developing system operating procedures,” states Supardi. The company also maintains strategic alliances with parties in the area of risk management, such as re-insurers, other export credit agencies, and credit information agencies, and with banking and financial institutions both in Indonesia and abroad.

“We are a member of the Berne Union (the International Union of Credit and Investment Insurance), which offers us the advantages of exchanging information as well as the ability to establish relationships with international financial institutions such as the International Monetary Fund, the World Bank, and the European Development Bank. As ASEI is still the sole export credit insurance agency in Indonesia, we must correlate the infrastructure of the agency to international standards,” Supardi adds.

The ASEI President encourages partnerships between Indonesian exporters and outside parties and believes that Indonesia has much to offer the foreign investor. “The Indonesian market is abundant with natural and human resources. Geopolitically and geographically, the country is situated right at the crossroads of Australia and the rest of the East Asian nations, which means that almost half of all international trade transactions take place in this region. Furthermore, the Indonesian government has set up policies to attract investors and we truly welcome American investors,” he states. “Indonesia is going through a profound process of institutional change and rebuilding. Although the crisis has had a multidimensional effect on the nation, I am confident that it will be over shortly and a new economic and social stability, and a more democratic society will have been created.”

BAMBANG HENDRAJATIN President of Bank Ekspor Indonesia (BEI)

Bank Ekspor Indonesia (BEI) was established by the Indonesian government in 1999 and is an export credit agency specialized in offering a full range of facilities to Indonesian export-oriented sectors, including financing, guarantee, and trade finance advisory services. According to the bank’s president, Bambang Hendrajatin, commercial banks are the conduit for both BEI’s refinancing (financing given to the commercial bank against financing that the commercial bank has extended to the exporter) and co-financing (a joint venture between BEI and the commercial bank) services.

Apart from the bank’s role as an export financer, BEI also contributes in forming national trade and industry policy and acts as a window of information for Indonesian export-oriented sectors and foreign buyers. The bank, which made nearly $30 million in profits in 2001, is now implementing a five-year strategic program that includes the on-going development of the bank’s risk management systems, as well as the commitment to building a world-class staff. The bank is also reconsidering its longer-term position. “As the bank was established to better Indonesian export competitiveness in the global trade market, we are planning to shift our role to respond to market needs,” Mr. Hendrajatin states. “Until now, we have been dealing with short term financing, but, later on, as the economy picks up, we will expand to include medium and long-term financing and become a full-fledged export credit agency.”