Lack of access to affordable trade finance is holding back the economic and employment potential of African countries, says Standard Bank.
According to the African Development Bank’s recent report on trade finance in Africa, the conservative estimate for the value of unmet demand for bank-intermediated trade finance is between US$110 billion and US$120 billion, which is significantly higher than earlier estimated figures of US$25 billion.
“Imagine the number of jobs that would be created if small and medium enterprises (SMEs) in Africa, could do the cross-border transactions that would have been supported by the unmet gap in demand for trade finance. The gap means there are corporates out there who would have liked to have done that business but just because they could not access trade finance they could not do those trades,” says Vinod Madhavan, Head of Transactional Products and Services at Standard Bank South Africa.
Trade finance has a direct impact on employment and Madhavan, who was recently appointed as member of the Banking Commission Advisory Board to the International Chamber of Commerce (ICC), the largest business organisation in the world, says the African market is clearly underserviced from a trade finance perspective. Read more. Source | New Era