As part of the OECD Arrangement, Belgian export credit agency (ECA) ONDD has cut its insurance premiums for political risks relating to medium or long-term export credits on Bulgaria, Romania and Russia (premium category 4 to 3 – on a scale from 1 to 7, 7 being the highest risk), Macedonia and Ukraine (premium category 6 to 5) and Georgia (premium category 7 to 6).


However, the premium for insuring the political risk relating to medium or long-term export credits was increased for Hungary and Latvia (premium category 2 to 3).


ONDD’s cover policy for these countries remains unchanged.


The ECA resumes cover for medium and long-term transactions with Sierra Leone. The cover ceiling for Sierra Leone amounts to €
35mn while the premium category remains unchanged (category 7 out of 7).


However, this only applies to highly profitable projects, which have priority for the economic development of the country and which are important for the Belgian economy.


For credits with public debtors, checks should be made to see whether they are subject to possible restrictions from the IMF as regards non-concessional credits.


Sierra Leone entered a process of gradual reconstruction following the civil war in 2002.


First, in a political sense with the restoration of peace and the organisation of democratic presidential elections in mid 2007. Second, the economy is growing at a fast rate, in particular thanks to the diamond sector, and is slowly benefiting from the contribution being made by the exploitation of other mineral resources. As a result of its economy’s high needs, the country carries current account and budget deficits that are financed by considerable amounts of aid from the international community, which it should be able to count on in the medium term.


The financial outlook cleared up following the cancellation of its foreign debt with multilateral institutions and the Paris Club as part of the HIPC and multilateral debt relief initiatives. As its external debt becomes more sustainable, the country will be able to allocate its resources better, notably towards vital sectors, which is essential for what is one of the world’s poorest countries.


The possibilities for cover of export transactions with credit of more than two years (medium/long term) with Moldova have been broadened.


However, cover remains limited to projects with very high profitability, which have priority for the economic development of the country and are important to the Belgian economy.


Credits for public debtors will now be eligible for insurance, provided it has been checked whether they are subject to restrictions from the IMF as regards non-concessional credits. Under the OECD Arrangement, the premium category for medium and long-term credit transactions remains unchanged (category 7 out of 7).


Moldova’s external debt and debt servicing are sustainable but liquidity remains poor. Thanks to improved economic policy, sufficient foreign support was pledged to cover the financing needs due to the double external shock in 2006. The debt rescheduling agreement with the Paris Club of May 2006 provides the country with the liquidity support it had solicited and regularizes its foreign arrears. Moreover, the recent cut-off date protects new credits to the public sector against a rescheduling in the context of the Paris Club.