ZCZC
BCN-21
ADB-TRADE-FINANCE-TFP
ADB boosts support for trade finance with 350 mln USD additional headroom
MANILA, June 11, 2018 (BSS/Xinhua) – The Asian Development Bank (ADB) on
Monday approved 350 million U.S. dollars in additional headroom to further
expand the scope and impact of its Trade Finance Program (TFP).
Supporting more than 12,000 small and medium-sized enterprises (SMEs) in
developing Asia since 2009, TFP helps reduce market gaps for trade finance by
providing loans and guarantees to financial institutions to support trade
activities in the region.
The ADB said the additional financing will increase TFP’s limit to 1.35
billion U.S. dollars, keeping up with the increasing market demand for trade
finance from the program, which grew over 50 percent in 2017.
TFP is able to support trade financing well above its limit over the
course of a year but not breaching the limit at any one point in time by
recycling transactions with short maturities and leveraging cofinancing.
“The increased headroom will help us meet the huge surge we’ve seen in
market demand for our trade finance products,” said Steven Beck, head of
Trade and Supply Chain Finance of ADB.
“It is an exciting time for the team, which is known for its excellent
client services, including transaction processing in 24 to 48 hours,” Beck
said.
Financial institutions in support of trade as well as SMEs play an
important role in closing the global trade finance gap, which amounts to 1.5
trillion U.S. dollars globally, 40 percent of which is coming from the Asia
and Pacific region, according to ADB’s latest Trade Finance Gap survey.
TFP has guaranteed or funded 5,583 transactions in 2016 and 2017 alone,
valued at 7.6 billion U.S. dollars, with cofinancing reaching 4.6 billion
U.S. dollars.
TFP currently operates in 21 ADB members, with the top five most active
markets including Armenia, Bangladesh, Pakistan, Sri Lanka and Vietnam.
BSS/XINHUA/HR/1405