We heard from Steven Beck, Head of Trade Finance at the Asian Development Bank, giving his musings on 2019, a year of uncertainty in trade, and what 2020 might bring for trade and supply chain in Asia.
With trade and economic sanctions becoming an ever more popular tool of foreign policy in today’s uncertain geopolitical climate, AML, screening and anti-fraud obligations are increasing in scope and complexity. At the same time, the growth in international cross-border trade to around $16 trillion per annum creates an environment that’s ripe for abuse for those wanting to launder money or finance terrorism or criminal activities through the guise of legitimate trade.
The superimposition of DLT into the trade and shipping space naturally brings about a major step towards the digitization of trade. The process of trade digitization, however, is still traversing a legislative grey area. In many jurisdictions, including the USA, there are currently no regulations or laws that recognize electronic negotiable instruments in lieu of their written counterparts. Overcoming this immense operating hurdle will be a key initiative to reaching the full potential of DLT in the trade space.
We heard about the global state of the SCF market. Collaborators: Dr Rebecca Harding, Mark Abrams and Simon Kleine
Trade finance due diligence is becoming both more critical – not least due to the heavy sanctions in place for regulatory non-compliance – and more complex.