Virtual launch of the report “Trade Finance Demand and Supply in Africa – Evidence from Kenya and Tanzania”
During this virtual launch, expert panelists will unpack the current trade finance landscape in the region, addressing, among other topics, the drivers of trade finance demand and supply in Africa, the demand for trade finance unmet trade gap at country level and the impact of trade finance. gap on corporate commercial participation. Experts will also discuss policy recommendations on how to support discouraged applicants for trade finance, the digitization of trade finance and how to reduce the trade finance gap in general. Participants will gain a better understanding of the challenges, opportunities and future of the trade finance market in Africa.
About the post
Understanding of the trade finance market in Africa is limited, mainly due to a lack of data.
Since 2014, the African Development Bank has been playing a leading role in trade finance market research to support the development of trade finance policies in the region.
While previous studies have focused on the supply of trade finance, many questions remain unanswered about the demand for trade finance by firms in Africa; including but not limited to the value of trade lost by businesses due to lack of access to finance, choice of trade finance instruments, challenges businesses face in managing trade finance trade and why some companies are discouraged from applying for trade finance. Answering these questions has important implications for policy makers and trade finance practitioners in Africa.
To help fill some of the knowledge gap, the AfDB has conducted an in-depth analysis of the trade finance market in Kenya and Tanzania for the first time, using data from 58 commercial banks and 804 companies across multiple sectors. The report is the most comprehensive study combining demand and supply data to understand the trade finance market in Africa.
The report presents policy recommendations to help sustain the trade finance market in Africa, including the need to (i) address structural issues of low creditworthiness and insufficient collateral, (ii) develop trade finance instruments to support discouraged trade finance applicants, (iii) support the digitization of trade finance transactions to reduce processing delays and minimize bureaucracy. The study also recommends that SMEs, especially women-owned SMEs, be supported to develop better risk and capital management systems to ensure they can easily access finance, meet their financial obligations and go into long-term debt to remain solvent.
Register today for what promises to be an informative session!