MENA Trade Finance 21Nov2012 Al Masah （中东和北非地区21 nov2012 Al Masah贸易融资）.pdfVIP

MENA Trade Finance What is trade finance? Why is trade finance important? What are the instruments used in trade finance? What are the recent developments in trade finance? How big is the trade finance opportunity? What is the potential for trade finance in MENA? What is Islamic trade finance? Who are the major/top players in MENA trade finance? What are the challenges facing the trade finance market? How Basel III impacts trade finance in the MENA region? 1 EXECUTIVE SUMMARY Trade has long been recognized as an important tool for economic growth. T rade enhances a countrys access to goods, services, technology, and even knowledge, among others. It fosters entrepreneurial activity, thereby creating jobs and demand for credit or trade finance. Access to trade finance is crucial for every country. It helps in the exchange of goods and services in the international market. According to the World Trade Organization (WTO), trade finance supports nearly 90% of global trade, making it vital to economic prosperity. The importance of trade finance was clearly demonstrated during the economic crisis of 2008– 09, when the global credit crunch magnified the slowdown in exports. The value of world merchandise trade declined 22.3% to USD12.5 trillion in 2009 from USD16.1 trillion in 2008. Trade finance is a specialized area of finance that deals with short-term financing of import and export transactions. It covers a wide spectrum of payment arrangements between importers and exporters. Products available include letters of credit (L/Cs), import financing, guarantees, L/C confirmation, pre-shipment export financing, invoice financing, and documentary collections. Regardless of t