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Regional: Due Diligence and Capacity Development of Trade Finance Program Banks

Nonsovereign (Private) Project | 37909-025 Status: Approved

The importance of short-term trade finance in achieving the Global Sustainable Development Goals (SDGs) is explicitly recognised in the Addis Ababa Action Agenda on Financing for Development. Yet, ADB''s Trade Finance Gaps Growth and Jobs survey of September 2017 confirmed a global trade finance gap of $1.5 trillion, and determined that 40% of this gap is in Asia and the Pacific, with 74% of rejected trade finance transactions coming from SMEs. The Trade Finance Program (TFP) and this related technical assistance are focused on reducing market gaps for trade finance. TFP closes market gaps for trade finance by providing guarantees and loans to partner banks to support trade. In 2017 TFP supported 3,500 transactions valued at $4.5 billion. Over 85% of TFP's transactions support SMEs. In addition to doing transactions, TFP provides capacity building (technical assistance, training, seminars, work shops), through this TA, to partner banks, which contributes to closing gaps.

 
Project Name Due Diligence and Capacity Development of Trade Finance Program Banks
Project Number 37909-025
Borrower/Company
Country Regional
Location Regional
Type or Modality of Assistance
0030 Technical Assistance USD 17.50 million Proposed
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Finance / Trade finance

Industry and trade / Industry and trade sector development

Gender Equity and Mainstreaming Some gender elements
Responsible ADB Department Private Sector Operations Department
Responsible ADB Division Private Sector Financial Institutions Division
Responsible ADB Officer Beck, Steven
Project Sponsor(s)
Objectives and Scope The importance of short-term trade finance in achieving the Global Sustainable Development Goals (SDGs) is explicitly recognised in the Addis Ababa Action Agenda on Financing for Development. Yet, ADB''s Trade Finance Gaps Growth and Jobs survey of September 2017 confirmed a global trade finance gap of $1.5 trillion, and determined that 40% of this gap is in Asia and the Pacific, with 74% of rejected trade finance transactions coming from SMEs. The Trade Finance Program (TFP) and this related technical assistance are focused on reducing market gaps for trade finance. TFP closes market gaps for trade finance by providing guarantees and loans to partner banks to support trade. In 2017 TFP supported 3,500 transactions valued at $4.5 billion. Over 85% of TFP's transactions support SMEs. In addition to doing transactions, TFP provides capacity building (technical assistance, training, seminars, work shops), through this TA, to partner banks, which contributes to closing gaps. More information can be found at www.adb.org/tfp.
Linkage to Country/Regional Strategy The importance of short-term finance to support global trade - known as trade finance - is explicitly recognised in the Addis Ababa Action Agenda on Financing for Development ( Addis Agenda ) as an important means of implementation of the Sustainable Development Goals (SDGs). Yet, ADB' s Trade Finance Gaps Growth and Jobs survey launched in September 2017 confirmed a global trade finance gap of $1.5 trillion, and determined that 40% of this gap is in Asia and the Pacific, with 74% of rejected trade finance transactions coming from SMEs. The program supports two pillars of ADB s operational focus cited in the Midterm Review of Strategy 2020: (i) poverty reduction and inclusive growth, and (ii) regional cooperation and integration.
Safeguard Categories
Environment
Involuntary Resettlement
Indigenous Peoples
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
Business Opportunities
Consulting Services Due Diligence and Financial Analysis Experts Firm; resource persons for seminars
Timetable for assistance design, processing and implementation
Concept Clearance -
Credit Committee Meeting -
Approval -
Last PDS Update 28 Sep 2018

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