The support of UK Export Finance is helping the country’s firms establish themselves in some of the world’s fastest-growing markets, writes Gareth Waterhouse, Head of Underwriting Policy and Products.


Overseas trade carries huge benefits, both for exporting companies themselves, and for the prosperity, productivity and growth of the countries they are exporting from. However, for companies new to international trade, there are risks in entering new markets or selling to buyers in politically or economically challenging markets and finding protection against these risks can be important.

That’s why export insurance is very much at the heart of a export credit agency’s product offering: stepping in where the private market can’t to protect exporters from the risk of not being paid by an overseas buyer, or political risks that make the contract difficult to deliver. UK Export Finance, the UK’s export credit agency, has been a pioneer in this market: we were a founding member of the Berne Union, the global association for the export credit and investment insurance industry, in 1934 and we have offered some form of cover against the risk of exporting since the 1920s.

UKEF’s mandate is to ensure that no viable UK export fails due to lack of finance or insurance from the private sector. We help exporters and investors manage risks in challenging markets with our insurance products where the private market is not able to offer cover.

Last year, UK Export Finance protected over £65mn worth of business with export insurance policies. The companies receiving these policies operated in sectors ranging from construction and commodities to consumer goods and services and were exporting goods and services to countries across the world, including Africa, Asia and the Middle East.

This support benefits companies ranging from SMEs to major corporates – the smallest case was a policy for just £157.50, while export insurance also made up part of UKEF’s largest-ever transaction, a £5bn package to support BAE Systems and MBDA’s sale of Typhoon and Hawk aircraft to the State of Qatar.

One of the companies we have helped was family-owned Bioguard Hygiene, which was able to fulfil a transformational contract with a large pharmacy chain in the Middle East thanks to an export insurance policy from UKEF.

When Bioguard won an export order of £90,000 with a large pharmacy chain in the Middle East, it was both a significantly bigger order than the company’s usual business and had the potential to become a repeat order customer. While great for Bioguard’s growth ambitions, having to finance production on a larger scale with limited experience of the buyer and without the security of advance payments led the company to seek extra financial protection should anything go wrong.

As most of Bioguard’s business is domestic, the company only wanted a standalone policy covering its new Middle East business – but struggled to find single-market cover from the private insurance market.

UKEF worked with Bioguard to develop a bespoke Export Insurance Policy tailored to its needs, allowing the company to take on the export order with confidence that it would get paid.

Thanks to UKEF support, Bioguard was able to secure significant revenue from an important new customer and maintain its momentum in a high-value market. In just four years, Bioguard has quadrupled the proportion of its export business and hopes to continue its overseas success, with a target of at least 40% of its orders coming from overseas within the next two years.

UK Export Finance also supported Lye Cross Farm to protect its international sales against changing market conditions.

Lye Cross Farm has been selling award-winning cheese and other dairy products from its North Somerset farm near the Valley of Cheddar for over 60 years. When the Alvis family’s third generation started managing the company 10 years ago, they decided to grow the company’s international presence.

Since then, Lye Cross Farm has found success globally from the United States to South Korea and all over Europe, with overseas sales now accounting for around 30% of the company’s total business.

Their business with a longstanding customer ran into difficulty when its existing provider was no longer able to provide export insurance for the destination market. This put the company at risk of losing an important regular customer and valuable long-term revenue stream.

UKEF worked with Lye Cross Farm to put together an export insurance policy tailored to its requirements, helping to ensure the company didn’t have to turn away business and could maintain its reputation for quality and reliability with its international customers.

UKEF’s support is helping UK firms establish themselves in some of the world’s fastest-growing markets. ONS figures show UK exports to emerging markets have grown by 62.2% over the last decade; as UK companies continue to expand their horizons to new markets, UKEF’s export insurance support will help them do business with confidence.