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Azevêdo urges UN’s Financing for Development summit to ‘close gaps’ in trade finance

Azevêdo urges UN’s Financing for Development summit to ‘close gaps’ in trade finance
Photo credit: UNECA

14 Jul 2015

Speaking at the opening session of the Third International Conference on Financing for Development in Addis Ababa on Monday 13 July, WTO Director-General Roberto Azevêdo outlined the major gaps which exist in the provision of trade finance, particularly in Africa and Asia, and the major impact that this can have on growth and development. He urged development partners to continue working together to help close these gaps.

The session was attended by UN Secretary General Ban Ki-moon, the President of the UN General Assembly, H. E. Sam Kahamba Kutesa, the President of the World Bank, Dr Jim Yong Kim, the Prime Minister of Ethiopia, Mr Hailemariam Desalegn, and many other heads of state and government, ministers and leaders of international organisations. 

The Director-General said:

“Trade played a major role in the successful global effort to halve extreme poverty – and it can do a great deal more in the years to come. A range of policy measures are needed to make sure that the poor feel the full benefits of trade.

“We have identified trade finance as a key issue here. Up to 80% of global trade is supported by some sort of financing or credit insurance. But developing countries are still suffering from the consequences of the 2008 crisis. The supply of credit has not yet returned to normal levels. And so we are seeing big financing gaps, particularly in Africa and Asia.

“The estimate for the value of unmet demand for trade finance in Africa is between 110 and 120 billion dollars. By bridging this gap we would unlock the trading potential of many thousands of individuals and small businesses across the continent. The smaller the business, the bigger the gains.

“In Asia, the unmet demand for trade finance is estimated at over 1 trillion dollars. As a result, all too often, opportunities for growth and development are missed. Businesses are deprived the fuel they need to grow. And we are prevented from leveraging trade's full power as a source of development. 

“We need to respond to this problem. At the WTO, we have been working with regional development banks to support the creation and expansion of trade finance facilitation programmes. We are working together to close those gaps and will be redoubling our efforts in the months ahead with a new initiative to achieve this goal.”

While drawing particular attention to the issue of trade finance, the Director-General also pledged his utmost personal support to the full post-2015 development agenda and detailed some of the practical elements of the WTO’s work which would help to deliver the forthcoming Sustainable Development Goals. These elements include the support provided by the Aid for Trade initiative, implementing all elements of the Bali Package, and delivering new outcomes for development at the WTO’s 10th Ministerial Conference in Nairobi this December – the first time the WTO has held such a conference in Africa.

His full statement is available here.

Source World Trade Organisation
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Date 14 Jul 2015
 
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