It is proposed that international institutions, regulators, regional and national governments and other stakeholders collaborate to build on the momentum established over the course of the global crisis to help ensure a robust, sustainable and innovative global architecture for Trade Finance and Supply Chain Finance. This architecture must be aimed at enabling increased trade, increased international development and the creation of economic value through support of real economy commercial activity that is inclusive of developing markets and allows SMEs to engage successfully in international markets.
• Taking steps to actively and explicitly integrate Trade Finance and Supply Chain Finance into well-established disciplines and practices around trade development and facilitation, including inclusion of access to Trade and Supply Chain Finance as part of the “Single Window” model of trade facilitation
• Explicitly adding a Trade and Supply Chain Finance dimension to (selected) existing programs aimed at facilitating and enabling enhanced trade flows.
• Devise a global program, in collaboration with IFIs and industry associations, aimed at raising awareness and technical competencies in Trade Finance and Supply Chain Finance in light of a looming shortage of this skill set, and as a complement to existing technical assistance programs in this area
• Design and facilitate a process to assess the adverse/unintended consequences of regulatory requirements on trade-related liquidity, ensuring that the economic cost of such consequences is objectively measured and that political authorities are engaged to achieve an appropriate balance between prudential regulation and the ability to conduct legitimate business
• Identify and deploy an international and cross-functional working group to assess and make recommendations relative to the impact of the global trade finance gap, on international development and trade-based poverty reduction. This initiative can include assessment of the applicability of innovations such as the ICC/SWIFT Bank Payment Obligation, to finance, trade and development
• Identify opportunities for UN and other international agencies to contribute to industry efforts aimed at attracting additional financial capacity to the business of Trade and Supply Chain Finance, through information, education and legal and regulatory changes that would allow additional capital to flow into trade finance activity
The scope of Phase I of the broader project is limited to the development of a roadmap aimed at integrating Trade Finance and Supply Chain Finance into the practices around trade facilitation,, given that access to financing can be a critical enabler for businesses of all sizes seeking to enter new international markets. The broader scope of activity will be articulated and explored in a subsequent phase of the project, based on results achieved and support secured following the completion of Phase I.
UNECE and UN/CEFACT in particular is perhaps uniquely positioned to act as facilitator of a project with such global reach and implications, given the organization’s extensive experience in trade facilitation and its key role in developing, articulating and expanding the notion of “Single Window” strategies to facilitate efficient market access to innovative instruments of trade and supply chain finance.
UN/CEFACT is well-placed to access and engage key stakeholders in international development and trade facilitation as well as trade and supply chain finance, given its network and ability to access domain experts across the universe of activities that will link together in the proposed project. Additionally, the recent and long-overdue shift in trade and supply chain finance to electronic, data-driven business models and transaction flows (admittedly still in infancy) tie in very well with the electronic business dimension of UN/CEFACT’s remit. Collaboration and/or information-sharing with other projects that may overlap or link in some way, will be proactively pursued as an element of project strategy and execution.
Leadership of the proposed initiative by UNECE will enable the engagement of or consultation with key stakeholders, including:
• UN Agencies and entities across the globe
• The World Trade Organization
• The International Trade Centre
• The International Chamber of Commerce
• International Financial Institutions including the IFC, ADB and others
• The World Economic Forum
• The Fung Global Institute
Additionally, private sector specialists from banks, non-bank providers of trade finance, domain experts and consultants and others may be contacted to assist in framing and/or delivering the proposed project. |