The sanctions for Russia are now to be tightened. According to a report, the traffic light government has now “suspended” the assumption of the Hermes loan guarantees. Guarantees of this kind are important in order to secure exports from German companies if a third party – in this case Russia – cannot pay. Therefore, exports from German companies to Russia are now significantly more risky – presumably numerous products are no longer delivered.
Hermes guarantees are intended to make exports to Russia more difficult
“From now on, the federal government is making it considerably more difficult for German companies to do business with Russia, even if their products are not on the European sanctions list, such as microchips or armaments. As the “Handelsblatt” writes, citing the Federal Ministry of Economics, Berlin has completely canceled the Hermes guarantees for Russia.
“The approval of Hermes guarantees and investment guarantees for Russia is suspended until further notice,” confirmed a ministry spokesman on request. Since 1949, the Federal Republic of Germany has been using export credit guarantees to protect exports from German companies against the insolvency of foreign customers, but also against the consequences of war or state confiscation.
Especially medium-sized companies, which lack a lavish financial buffer, in many cases this enables the necessary sales financing – and thus the foreign business. Applications are checked and processed by the Hamburg credit insurer Euler Hermes, which gave the program its name. However, the money itself comes from the federal government in the event of damage. A deductible of five to 15 percent applies to the damaged exporters. According to the Federal Ministry of Economics and Technology, German companies exporting goods to Russia received new cover commitments of 820 million euros in the first six months of 2021.”
In the end, this may significantly reduce imports from Russia.
Report with material from the dts news agency
Photo: Road and train traffic in Moscow (Russia), via dts news agency
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