Leading Evolution: A Career Reflection on Political Risk and Trade Credit

One could say that Stuart Barrowcliff grew up within political risk. Stuart, Underwriting Manager for the Political Risk, Credit & Bond division of AXA XL, has had a decades-long career in political risk and trade credit, but his introduction to political risk came much earlier. His career has taken him around the world through various positions in financial institutions and has led to innovative conservation efforts in countries across the globe. He is fluent in Portuguese and Spanish and has never lost his affinity for all things international.

This Spring, as Stuart readied for retirement, he reflected on his career and the path his life took to get him to where he is today.

FFF: How did you first become interested in political risk?
Stuart: The genesis of this goes back. My father worked for a chemical company. We were sent to Pakistan when I was beginning high school. So, from early days going to school in Pakistan, that piqued my interest in all things international. We were there for four years. That motivated me to go to college for an international relations degree, and then a master’s degree in international relations, as well. Ironically, and I did not know at the time, but my father’s company bought one of the early OPIC political risk policies covering his company’s fertilizer plant in Pakistan.

During my graduate school days, my father was transferred to Brazil, and so that piqued my interest in learning about that country. After I graduated, I went to work for a year in Brazil, though not in insurance yet.

After Brazil, where did your career take you?
I went into international banking in Los Angeles. Also, I worked for two years in Madrid during my banking career. So became fluent in Spanish, to, and have been interested in foreign affairs, economics, business since then.

In banking, I structured a few transactions using political risk and credit insurance and when an opportunity arose with a political risk and credit insurer, I decided to take it and shift career gears. That was back in 2007. It was at a time when I was keen to do something a little different, I had always enjoyed the flexibility and quick turnaround of the insurance product as well as the entrepreneurial mindset of underwriters, so I made the switch.

The essence of these transactions is that they provide a way for countries to unlock financial resources to fund to expanded conservation programs by refinancing more expensive debt that a government may have with something less expensive.

During your career, what projects or changes have you been part of that you feel have had an impact on those around you?
Definitely the debt-for-nature projects that we have supported at AXA XL. An example is one project we did in The Bahamas in 2024. The essence of these transactions is that they provide a way for countries to unlock financial resources to fund to expanded conservation programs by refinancing more expensive debt that a government may have with something less expensive. A portion of that savings can be channeled to nature conservation.

One of the most important aspects of these projects is that their risk mitigation elements – where political risk and credit insurance is a critical ingredient – results in significant private capital mobilization alongside multilateral development bank capital, such as the Interamerican Development Bank in The Bahamas project. That provides a greater amount of money that is now available at attractive rates, attractive pricing for the country, so they can improve not only their conservation programs, but also overall, they reduce the cost of their borrowing. It is a win-win situation.

That must be exciting to be out front of such innovation.
It is as these transactions have been groundbreaking in many ways. One of the most satisfying aspects of this journey is recalling the fantastic collaboration and teamwork that it took to bring these transactions to fruition. As you know, The Bahamas debt for nature financing only is the most recent which was preceded by six of these types of projects, including an Ecuadorian marine conservation project for the Galapagos and Ecuador’s bio corridor project, as well as transactions in Belize, Gabon, and El Salvador. In addition to the positive tangible contributions of these projects to conservation and each country’s economic development.

The Bahamas was groundbreaking, because we worked alongside the Inter-American Development Bank and alongside a philanthropic investor for the first time co-insurers/guarantors. That created a template that can be replicated. We’re in discussions about similar transactions in a number of countries, so there’s a lot of activity and potential deals going forward. One of the fun parts of the business is finding ways to innovate with nontraditional applications of political and credit insurance; that is what all these transactions represent.

Is that an indicator of how the market has evolved throughout your career?
Yes, and an indicator of how it will continue to evolve. Since I joined, this industry has grown tremendously in the number of insurers offering cover and quantum of capacity available to support quite large projects for extraordinarily long tenors (up to 25 years). Political risk has become far more flexible. It has so many different applications. It is something that can be wrapped around a variety of various kinds of risks. Once you understand the parameters of a particular risk, you can define a trigger (the insurable event) that can be effectively woven into an applicable policy of wording.

Early on, the insurance in the political risk and credit world would extend just 12 months. That was a long tenor. Nowadays, we do project financing and infrastructure projects where the policy period can reach up to 25 years. The expanded understanding of how this insurance can be applied is a key reason behind the increased capabilities and competition that is characteristic of today’s market.

Why should today’s job seekers consider an insurance career?
My fundamental recommendation is to understand and play to your strengths, pursue what you are passionate about driving your energy. You can find all sorts of ways to participate in this market. For any student today who is looking for a multi-disciplinary career where they can apply an innovative, commercial approach to development finance on a global scale, political risk and credit insurance could be the go-to career. Insurance is very flexible and, having come into insurance from banking, my experience is that it can be less bureaucratic and more agile in responding to new market opportunities than in the lending world. Also, it is quite varied, giving one the opportunity to engage across a wide range of sectors, transaction types, and geographies.