Participants' Country risk classification

The Country Risk Classifications are established by the Country Risk Experts’ Group (CRE Group), an independent technical sub-body of the Participants to the Arrangement.

This Group is made up of CREs from the Export Credit Agencies (ECAs) of the Participants.

The procedures and customs of the CRE Group have been designed to ensure that discussions remain purely technical and are not influenced by any non-risk related (including political) considerations.

The CRE group meets several times a year to update the list of country risk classifications. These meetings guarantee that each country is reviewed at least once a year and whenever a fundamental change is observed.

The list of Country Risk Classifications is publicly available and published on the OECD website after each meeting; however, the exchanges and deliberations at these meetings are strictly confidential.

The OECD has an administrative role only and is not involved in the classification process.  

Not all countries are classified, including:

• High-income OECD countries and high-income Euro-Zone countries: Transactions in these countries, also referred to as market benchmark countries, are subject to different minimum premium rules that rely on market ratings. 
• Very small countries that do not generally receive official export credit support: for such countries, the Participants are free to apply the Country Risk Classification which they deem appropriate.

The Country Risk Classification takes place through the application of a two-step methodology:

• A quantitative assessment of country credit risk produced by the Country Risk Assessment Model (CRAM) and based on four groups of risk indicators:
  1. the payment experience reported by the Participants;
  2. the financial situation of the country based on IMF and World Bank macro-economic data; 
  3. the economic situation (policy performance, growth potential, and vulnerability) of the country based on IMF and World Bank macro-economic data;
  4. and the institutional situation of the country based on the World Bank Governance Indicator.

A qualitative assessment of the CRAM results by the Country Risk Experts, in order to integrate factors not fully taken into account by the model (e.g. crises, wars).

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