Exporters Receive Some Breaks To Speed, Aid Payment of Bills

Deputy Prime Minister Jin Nyum said Thursday that Korea Development Bank will increase the purchase of export bills by $1.2 billion during the remainder of the year. That will put the state-run bank's total purchase to $3.6 billion in the second half of the year.

Exporters can negotiate the receivables they obtained from foreign importers at up to 2 percent over the London Interbank Offer Rate (LIBOR) based on 90-day terms, the bank said. The document against acceptance is a method of payment collection by exporters. Exporting companies can collect cash payment from the commercial banks at a discount.

Korea Credit Guarantee Fund and Korea Technology Credit Guarantee Fund will also guarantee up to the face value of export letters of credit for newly established exporters and others that are experiencing an increase in uncollected payments. The ceiling for individual companies will be 50 percent of the annual revenue. Mr. Jin said the measure will increase guarantees to exporting companies by at least 1.3 trillion won ($1 billion).

The government will also support an increase in financing for smaller exporting companies, Mr. Jin said. Additional funds will be raised to provide low-interest financing to trading companies.

by Kim Young-sae