Export Credit Guarantees for the Security and Defence Industry
Cover with the Supplier and/or Buyer Credit Cover
The German Government supports arms exports by the German security and defence industry with Export Credit Guarantees. They are available to all export companies based in Germany and banks - regardless of the size of the company or the size of the order.
How exporters benefit
Export Credit Guarantees offer exporters reliable protection against non-payment risks in foreign transactions and often make exports possible in the first place.
Financing issues play a crucial role in the buyer's sourcing decision. If the transaction can be financed favorably thanks to an Export Credit Guarantee, the chances of the foreign customer ordering in Germany increase.
How customers benefit
The purchasers of military equipment are usually states that carry out tendering processes when awarding their procurement contracts. In doing so, they must take their national budgets into account, among other things. Tenders often require the supplier (the German exporter) to organize attractive buyer financing.
Export Credit Guarantees make an important contribution to the attractiveness of buyer financing by converting the buyer risk (customer) into a first-class risk (Germany’s AAA rating) for the financing bank. This not only facilitates the financing or makes it possible in the first place, but also considerably reduces the financing costs for the customer.
Availability of Cover
The availability of cover is determined by the goods to be exported in combination with the recipient country.
Cover is available for exports of war weapons and other defence equipment to the following countries:
- Customs territory of the EU, certain NATO member states, NATO-equivalent countries und other countries
- Third countries
Cover for other military goods is determined on the merits of the individual case based on a preliminary inquiry.
No cover is available for exports to embargoed countries in accordance with Section 74 (1) of the Foreign Trade and Payments Ordinance (AWV).
A compact overview shows the Cover facilities at a glance:
Preliminary inquiry
A letter of interest can be issued on request. For this purpose, an informal preliminary inquiry can be submitted to the contact persons listed below, which is free of charge.
For arms exports to third countries, a concrete indication must be obtained as part of a preliminary inquiry (analogous to a letter of interest inquiry) before submitting an application to the Federal Government. Following a positive indication, the usual application process can be initiated.
During the exploratory phase of your project, Euler Hermes financing experts are also available worldwide to support you directly on site.
Application
You can easily apply for an Export Credit Guarantee online in the myAGA customer portal (DE). To do this, register once and effortlessly in just a few steps on our myAGA customer portal (DE). If you are already a myAGA user, you can log in directly with your access data.
If you need help with your application or have questions about the right product for you, please contact our business consultants.
Financing for defence projects at a glance
Products
Supplier Credit Cover (exporters) and/or Buyer Credit Cover (banks) are used to cover arms exports.
In addition, a combination with other forms of cover (e.g. Manufacturing Risk Cover, Contract Bond Cover, Counter-Guarantee) is possible. This provides the exporter with cover options from the start of production to the expiry of the warranty period.
Premium
The costs of an Export Credit Guarantee consist of fees and charges. The fee makes up the bulk of the costs and is essentially dependent on the risk period and the country and buyer risk. You can quickly determine a cost indication yourself (calculate costs) or at an early stage as part of an Online inquiry receive
The fee rates according to the valid fee schedule for fees apply. For transactions in OECD Consensus Category I countries, a market test must generally be carried out when determining the fee.
Uninsured portion
- for Supplier Credit Cover
- 5% for political risks
- usually 15% for commercial risks
- 5% for all risks in the case of Buyer Credit Cover
Downloads
Do you have further questions about safeguarding defence exports?
Our contact persons will be happy to answer any questions you may have regarding the safeguarding of defence exports and, if desired, will guide you step by step through the application process.
Your Contacts
