As Trade War Deepens, A State-Owned Insurer In China Helps Soften The Blow

www.oann.com | 3/1/2013 | Staff
itsdonaldk (Posted by) Level 3
BEIJING/SHANGHAI (Reuters) – As the U.S.-China trade war intensifies, an insurance company run by the Chinese government is stepping in to support Chinese exporters, providing low cost coverage and chasing down U.S. importers unwilling or unable to pay mounting tariffs.

China Export & Credit Insurance Corp, known as Sinosure, has aggressively increased its insurance of Chinese exporters since last year, according to company sources and public data.

Aid - Trade - Experts - Practice - Afoul

The government-led aid is being carefully watched by trade experts who say the practice may run afoul of World Trade Organization (WTO) commitments or be challenged by the administration of U.S. President Donald Trump, who has railed against what he says are China’s unfair trade practices.

Sinosure has boosted the number of new clients by thousands since last August, often relaxing its standards to do so, company data and two Sinosure sources familiar with the standards say.

Cases - Governments - Premiums - Sources

In some cases, local governments are even paying the premiums, the two sources say.

The insurance policies help cushion companies from the risk of export deals collapsing because of elevated duties on goods flowing between the world’s No.1 and No.2 economies.

China - United - States - Trade - Showdown

China and the United States have been locked in a ****-for-tat trade showdown for over a year, with the latest increases to tariffs on hundreds of billions of dollars worth of goods taking effect this month.

Last year, as the trade war started to bite, Sinosure’s claim payouts surged more than 40% to nearly $2 billion, according to data from the company, which is owned by an investment company controlled by the finance ministry.

Payouts - Year - Tariffs - Company - Estimates

Payouts are poised to climb further this year with tariffs rising, according the company’s internal estimates.

The payments stem from what one Sinosure official said was a growing number of U.S. buyers of Chinese goods who were unwilling or unable to pay higher prices for shipped goods. That has left...
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