AIG has expanded its trade credit insurance offering to the GCC as banks and corporates look for more security post-Arab Spring.

Trade credit insurance (TCI) has experienced a tremendous growth in demand in the Middle East following a wave of defaults caused by the Arab Spring, and AIG is capitalising on that demand, launching insurance services in a region where it previously had no footprint.

The firm’s UK head of trade credit insurance, Will Clark explains to GTR and reporters at the launch that AIG’s activity in the GCC will be outward-looking, aiming to support exporters principally.

“While doing research on the region, we were surprised by the level of take-up, and the welcome we’ve had from brokers and bankers is very encouraging; they are telling us that we need a presence in this region,” he says.

While the lack of credit rating information on GCC corporates could prove to be an obstacle, Clark believes appropriate due diligence will provide AIG with a high level of understanding of how its clients work.

“The key to any successful financing is insight. And compared to four or five years ago, the degree of reticence to share information on clients has toned down,” he adds.

Clark explains that banks in the GCC, whether local or international, have been affected by the financial crisis, with global players now having to adjust to Basel III and local ones still feeling the effect of the turmoil on demand and unemployment.

“There are still challenges, but there is a desire to export, provide capital and mitigate risk with credit insurance,” he points out.

GCC clients will receive support from Clark in London and Gautam Murkunde, head of credit insurance at Tata-AIG in Mumbai.