Yike, mama, not in that direction ... the other way ... them way is mined with explosive debt, even though it looks perfectly easy as an escape route ...
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Insurer puts US on risk-watch list
biz.scmp.com
Monday, July 16, 2001
ENOCH YIU
One of the world's leading credit insurers has put the United States on its watch list due to a dramatic increase in the number of companies defaulting on export payments.
French credit insurer Coface Group has warned the US its credit rating would be downgraded if the situation worsened.
Coface offers export credit insurance to exporters in 94 countries and territories, including Hong Kong. Its country risk-rating service measures the average corporate payment default risk in 140 countries. In its latest rating review, the US, Japan, Taiwan and Brazil were placed "on watch with negative implications", while Israel, Argentina and Turkey were all downgraded.
Coface said the US had been placed on watch because "company payment behaviour was deteriorating in an unfavourable macro-economic context".
"The number of company bankruptcies, which had been falling for three years, is no longer declining," it said in the review.
"The Federal Reserve's successive reductions of its key rate have not stemmed the decline in investments or boosted stock market trading."
Payment default risks were higher for exporters dealing with US companies engaged in the computer, technology and telecommunications sectors. But traditional areas, such as textiles, steel and stationery were also vulnerable to bankruptcies.
Japan and Taiwan - also major trading partners for Hong Kong - both had the A1 top rating but were put on the watch list.
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