The Norwegian government has announced plans to merge the country’s two export credit agencies (ECAs), as it bids to “simplify” the export credit process and increase its volume of exports.

As part of the merger, Export Credit Norway and the Norwegian Export Credit Guarantee Agency (GIEK) are set to be brought together by July 1 next year, creating a brand new ECA which combines Export Credit Norway’s lending powers and the guarantee support currently offered by GIEK.

The proposal is subject to approval by the Norwegian parliament.

In the past, the two ECAs have tended to participate in many of the same projects, with GIEK guaranteeing 72% of all the loans Export Credit Norway was still managing as of the end of 2019.

The decision to merge follows a comprehensive review of the Norwegian public support system, which recommended the pair be brought together for increased quality, efficiency and to make it easier for the business community to navigate support for exports.

The export credit offerings currently provided by GIEK and Export Credit Norway will be transferred to the new agency, while other products, such as the building loan and power purchase guarantee schemes, which do not promote exports, will also be continued.

An interim five-person board has been set up to prepare the merger. Included in this are the current board chairs from both ECAs, Export Credit Norway’s Else Bugge Fougner, and GIEK’s Karin Bing Orgland.

Export Credit Norway notes in a statement that the merger will not have any impact on the its existing obligations, nor the conditions of its commitments. Meanwhile, GIEK says it will operate as usual until the merger takes place.

The move has been welcomed by Export Credit Norway’s CEO Otto Søberg, who says that the merger is one of several measures needed to improve and streamline the Norwegian export strategy.

He’s previously said that the country needs to boost its export levels in the coming decades, stating in Export Credit Norway’s 2019 annual report that the country is overly reliant on oil and gas, which account for almost half of its exports.

Søberg adds that if the country is to close its “large export gap”, exports other than oil and gas will have to double from approximately NKr800bn as recorded in 2018 to approximately NKr1.6bn by 2040.

While plans to merge GIEK and Export Credit Norway predate the onset of the coronavirus pandemic, Iselin Nybø, the country’s minister of trade and industry, says the merger will be “positive” for businesses as they look to ramp up activity after the damaging effects of Covid-19.

According to Nybø, the government is now working on a wider Export Action Plan, which will see the administration propose measures to improve the ways in which the public support system aids Norwegian businesses operating internationally. The merger is one of these measures, she adds.