There are growing calls for the Government to introduce a State-backed export credit insurance scheme.

Export credit insurance is a form of business insurance that covers the value of goods being exported to countries or customers where there may be a risk of non-payment.

Companies can usually source export credit insurance from the private insurance market but this has dried up following the outbreak of the COVID-19 virus.

In April, the European Commission relaxed state-aid rules to allow member states introduce state-backed export credit insurance schemes to support businesses through the COVID-19 crisis.

According to Paul Kelly, director with industry body Food Drink Ireland (FDI), Ireland is one of the only countries in Europe yet to introduce such a scheme.

Outlier

“Ireland is now an outlier in Europe when it comes to introducing state-backed export credit insurance.

“Even the UK has introduced this scheme. It’s leaving Irish food and drinks companies at a competitive disadvantage,” said Kelly.

A survey of CEOs in the Irish agri-food industry carried out by FDI found that 68% of companies are experiencing reduced production, 64% are seeing a reduction in their customer base while 73% expect a decline in export sales.