Exports:

In this issue... Export Development Canada competes with private companies in providing trade credit insurance. Is it time to rethink the Crown agency's mandate? The Study in Brief With Parliamentary review of the Export Development Act due in 2008, the federal government should seize the opportunity to streamline the operations and priorities of Export Development Canada (EDC). Straightforward economic reasoning and ongoing developments in the global financial services industry call into question the scope of financial services now marketed by EDC. Policymakers should consider restructuring EDC's operations to create a truly competitive export finance and export insurance environment for Canadian companies. This Commentary contends that the privatization of EDC’s short-term insurance portfolio is an overdue and easily implemented option. Withdrawing from the short-term credit insurance market would make EDC a more streamlined organization, enhance government revenues and bring Canada’s export-credit insurance regime in line with international norms. More importantly, the withdrawal of the government-backed insurer from the market would level the playing field and spur the development of a more robust private credit insurance market. Ultimately, this will benefit Canadian exporters