Export insurer hikes coverage for Samsung, LG in U.S. market

By Lee Joon-seung
SEOUL, Feb. 25 (Yonhap) -- South Korea's state-run export insurer said Wednesday
it has raised its coverage ceiling for Samsung Electronics Co. and LG Electronics
Co. to help the two companies expand their U.S. market presence.
The increase in coverage for transactions with U.S. retailer Sears Holdings Corp.
is expected to increase the two South Korean firms' exports to Sears to US$1.73
billion worth of goods this year from the $1.05 billion reached last year, the
Korea Export Insurance Corp. (KEIC) said.
KEIC has increased the insurance coverage limit set for Sears and its affiliates,
which currently stands at $130 million, by more than three-fold to $400 million.
Listed on the NASDAQ market, Sears Holdings, which put Sears Roebuck & Co., Kmart
Holding Co. and other smaller affiliates under its wing, is the third-largest
retailer in the U.S.
KEIC said the decision is noteworthy because it was made amid moves by private
export insurers to cut back on coverage to U.S. retailers following the collapse
of Circuit City Stores Inc. last year.
"The measures are expected to help Samsung and LG build on their already solid
market base established over the past few years," an official at the public
company said.
He pointed out that with some help, the two companies should do well since the
weak Korean won has significantly enhanced the price competitiveness of locally
made goods.
The export insurer added that because other companies are curtailing exports, the
present circumstances may help Samsung overtake Sony Corp. in the upper-end
digital TV market, while LG may be able to edge past Whirlpool Corp. in such
areas as refrigerators and washing machines.
yonngong@yna.co.kr
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