With the first
month of 2016 already behind us, it is with great pleasure that I
am writing this second newsletter of the year, as I am sure that the
upcoming months will not only bring with it challenges but will also
provide us with a number of opportunities. And what a start to the year
we’ve had so far!
If we thought that the worst of the market
correction and volatility in emerging markets and commodities in the latter
trading sessions of 2015 was over, we were mistaken. Markets woke up to a crude
awakening in the first six weeks of 2016. From weakness in the Chinese economy to
lower commodity prices and global economic data persistently disappointing to
the downside, markets witnessed a marked increase in risk aversion as the
capital flight to safety caused a widespread correction in equity and corporate
bond markets.
Markets were offered some respite following
market-friendly statements from the European Central Bank, US Federal Reserve
and Bank of Japan towards the end of January, only to resume their downward
trajectory shortly thereafter.
The market for short-term trade receivables
has, nevertheless, remained fairly resilient. And for good reason. These receivables
are low-risk, as the recently published ICC Trade Register has shown, SME-friendly
and compatible with many sanctions regimes. It is possibly for these reasons
that we are seeing much new or renewed interest in forfaiting from Russia and
Africa.
Turning to this issue of the ITFA
Newsletter, Edward George - Head of Group Research at Ecobank, takes us through
the challenges the African continent is facing with a wide trade finance gap,
and what needs to be addressed to narrow it down significantly.
May I take the opportunity to remind you
all that, as promised, the ITFA Events Calendar for 2016 has now be launched
and can be viewed on our ITFA website. We encourage our members to access this
page on a regular basis, in order to be informed of all upcoming ITFA events.
Watch this space for more.
Best wishes,
Sean Edwards
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