Asia Pacific sees better trading financing ahead-poll
Trade financing should improve over the next six months as the global economy climbs out of recession, a survey of trade officials in 18 Asia Pacific economies showed.world Updated: Jul 18, 2009 14:07 IST
Trade financing should improve over the next six months as the global economy climbs out of recession, a survey of trade officials in 18 Asia Pacific economies showed.
The survey found trade finance was an area of concern for members of the Asia Pacific Economic Cooperation (APEC), and it will be on the agenda when trade ministers and top officials from 21 countries meet next week in Singapore.
The study, conducted by host Singapore, showed 16 out of 18 APEC economies surveyed said they faced some problems in trade financing, but 10 of them expected the situation to improve over the next six months.
"The most commonly cited reasons for tightness in trade financing were increased risk aversion of financial institutions towards companies, higher perceived counterparty risks, and general liquidity shortage in the economy," the survey said.
The survey's optimism on the outlook for trade financing was in line with a projection by the Organisation for Economic Cooperation and Development (OECD).
OECD Secretary-General Angel Gurria told Reuters earlier this month that trade finance had gone "from being closed at the beginning the year to now being selectively more open".
Global trade flows are expected to fall 10 percent this year, with sharp drops already seen in emerging markets in Latin America, Southeast Asia and Africa. This is due both to dried-up credit and dampened consumer demand. APEC trade ministers are due to meet on Tuesday in the city-state.
APEC, founded in 1989, has 21 members that represent more than 50 percent of global GDP, and are home to some 2.7 billion people, or 40 percent of the world's population. China, Russia and the United States are three of the group's largest members.