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IIG Trade Finance Insights Archive/Past Editions

A Persistent Trade Finance Gap
IIG Trade Finance Insights, April 2017

Since the end of the 2008-2009 financial crisis, the gap between the amount of trade finance businesses need versus the amount of trade finance that is available has not gotten any narrower. In fact, in some countries and regions, the gap has worsened. Recent research from the Asian Development Bank (ADB) and the World Trade Organization (WTO) has begun looking for the reasons this gap, which is a far greater problem for small and medium-size enterprises (SMEs) than for larger corporations, persists. Even when trade finance is available to SMEs, it is often too expensive for these businesses to pursue.

What this research has found is neither very surprising nor very encouraging for those who track the trade finance marketplace. Yet, this information is very much needed if trade finance stakeholders are to find ways to bridge this persistent gap. At the same time, this research is also pushing experts to position trade finance as a smart investment for private investors and to advocate for a stronger market infrastructure to support those investors interested in participating in the space.

The main finding from this research is...


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