Written answers
Wednesday, 11 July 2012
Department of Enterprise, Trade and Innovation
Live Exports
9:00 pm
Michael McCarthy (Cork South West, Labour)
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Question 107: To ask the Minister for Jobs, Enterprise and Innovation if there are plans to introduce export credit for sending cattle to Ukraine, Russia and Kazakhstan following a reference to it in Budget 2012; and if he will make a statement on the matter. [33833/12]
Richard Bruton (Dublin North Central, Fine Gael)
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There are no plans to introduce a Government-guaranteed export credit insurance scheme for cattle exports to these or other countries.
The Government's position on the wider issue of export credit insurance generally has been informed by the findings of the 2009 report commissioned by my Department from KPMG consultants. That report established that the introduction of a general scheme would be expensive, with significant on-going costs arising for the State. Annual costs in respect of quite a low level of intervention in the export credit market would be about €1.7m and this cost would rise significantly, if higher risk profile exports were covered.
In addition, it was found that such a scheme would be of very limited impact, and that a negligible number of jobs could be connected with such an initiative. Any positive impact is likely to be even more limited were a specific scheme to be introduced for a small sector of the cattle trade.
Since the onset of the financial crisis there has been an improvement in the market for short term export credit insurance. Insurers have extended their capacity for risk and the market has recovered significantly with both new entrants to the market and new products being offered. This has greatly improved the availability of export credit insurance on the commercial market.
As the Government has a responsibility to ensure efficient use of scarce resources, it would be unwise to make a commitment to funding an initiative with marginal benefits for the wider economy and high level risks to the State.
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