TFG Weekly Trade Briefing, 6th April 2020

Your Monday morning coffee briefing from TFG. Here are some of the last week’s updates from the trade sector. Business activity has continued to slow and contract around the world, despite fiscal stimulus and DFI assistance to relieve the impacts of COVID-19 for businesses. The focus last week was primarily around supporting supply chains in the hunt to provide PPE (personal protective equipment) and ventilators to hospitals around the world.

Latest on COVID-19

Global cases of COVID-19 rose to over 1.1m and deaths to over 64,400. Business activity in the UK contracted at its sharpest pace in March since records began in 1996 while manufacturing activity in China showed a modest expansion in March following a record contraction in February. Over 80 emerging-market countries have approached the IMF for assistance in recent weeks.

WTO issues new report on worldwide trade in COVID-19 medical products

The WTO Secretariat has released a new report on trade in medical products critical for the global response to the COVID-19 pandemic. The report traces trade flows for products such as personal protective products, hospital and laboratory supplies, medicines and medical technology while providing information on their respective tariffs. Read more →

British lenders suspend dividends after BoE pressure

UK banks agreed to suspend dividend payments following pressure from the Bank of England. This followed a similar move by the ECB. Lloyds, RBS, Barclays, HSBC, Santander and Standard Chartered said they would cancel their dividends for 2019 and refrain from setting cash aside for investor payouts this year. They also pledged not to carry out any share buybacks. Read more →

Oil falls 12% on doubts over any Saudi-Russia deal

Global oil prices remain on edge after Saudi Arabia and Russia postponed a meeting about a deal to cut output as the virus pandemic hits demand. The two countries have been locked in an oil price war for the last month. Traders are concerned that, with large parts of the world in lockdown, there will be too much crude available, putting pressure on prices. Last week, crude prices soared after US President Donald Trump suggested that an agreement was imminent. Read more →

UKEF expands protection against non-payment for UK exporters in response to Coronavirus

UK Export Finance has announced it is expanding the scope of its Export Insurance Policy (EXIP) to cover transactions with the EU, Australia, Canada, Iceland, Japan, New Zealand, Norway, Switzerland and the USA with immediate effect. Exports from the UK to these markets totalled £499bn last year, accounting for 74% of all international sales from the UK. Read more →

Pandemic to accelerate digitisation of global trade, say trade authorities

Global trade is going through a “paradigm shift” towards digitisation as a result of remote working during the coronavirus outbreak, say leading trade authorities in the UK.

Until recently, much international trade was conducted using paper letters of credit and bills of lading. However remote working during the pandemic has made increased digitisation inevitable. Read more →

Financial crime levels increase as COVID-19 pandemic grows

Money fuels serious crime, including drugs trafficking, human slavery and terrorism. Managing financial crime risk while keeping up with the speed at which trade finance and payments technologies are emerging presents a huge challenge for banks around the world. TFG heard from Standard Chartered’s Global Co-Head, Financial Crime Compliance, David Howes. Read more →

Regulators free up $500bn capital for lenders to fight COVID-19

Central banks and regulators across the world have freed up $492bn of capital for lenders to help them absorb the impact of the COVID-19 outbreak. According to calculations by the Financial Times. By relaxing capital requirements in the past few weeks, central bankers have aimed to keep credit flowing to businesses and households and mitigate the economic turmoil caused by mass quarantines put in place to slow the spread of the virus. Read more →

TFG COVID-19 Hub Launched: Looking beyond COVID-19

Following on from our recent Live Tradecast in partnership with ITFA, TFG have created it’s COVID-19 hub, featuring insights from a banking, trade credit insurance, fintech and legal perspective on the implications of coronavirus on the trade finance sector. Read more →