In a recent conversation at Sibos, Toronto, TFG’s Deepesh Patel sat down with Steven Beck, Head of Trade and Supply Chain Finance at the Asian Development Bank (ADB). Together, they explore the reasons behind the staggering expansion of the trade finance gap, which has now reached a staggering $2.5 trillion.
This vast gap represents a concerning lack of financial support for the import and export sectors, posing a significant obstacle to realising the full potential of trade in driving economic growth and job creation. To tackle this issue, two key steps are proposed for the industry.
First, the urgent need for the digitalisation of global trade. They discuss the Digital Standards Initiative, which aims to garner consensus among various stakeholders on the electronic versions of 35 critical trade documents. They further highlight the importance of governments aligning their domestic legislation with UN model laws that recognise these electronic documents.
This transformative shift toward digitalisation holds the promise of significantly boosting global GDP and productivity. Steven Beck underscores the pressing importance of closing this substantial trade finance gap.