Dear Members and Friends,
In a fractious and at times apparently increasingly segmented world, where trade barriers, or the prospect of them, and technological advances such as 3-D Printing seem to be pushing us ever more inward and localised, it is heart-warming to see that the desire for standardisation embodying best practice, sound governance and legal certainty is alive and well amongst bankers. Especially so in the trade finance community which regulators still conceive of as riddled through with fraud and money-laundering. The thought came home to me forcefully whilst speaking on behalf of the association at a number of conferences and ITFA events recently. In the big ecosystem of supply chain finance (see the recent Standard Definition for Techniques of Supply Chain Finance published last year by ITFA and BAFT amongst others) the requests for global standards have been very vocal. My own view is that a single set of rules for this market is neither practical nor desirable and may stifle the creativity which has been so prevalent if such rules were ever to become mandatory but governance and best practice is an objective worth fighting for. With the attitude I have seen evidenced recently we have made a good start on this journey.
Looking at the markets, the beginning of the month saw investors begin to question the sustainability of the emerging-market revival that channelled almost $60 billion into assets of developing economies during the first months of 2017. While money is still flowing in, some investors were a bit weary, and held back from pumping more money in, as worries that the buying spree, which helped give emerging-market stocks and currencies their best quarter in two years, has resulted in heightened valuations.
Geopolitical tensions heightened during the month. With tension growing between the U.S. and North Korea, there is elevated political risk from many angles. This coupled with the uncertainty in the run up to the French presidential elections halted flows into the asset class. However, following the first round of elections in France, flows picked up into emerging markets as the likelihood of Macron emerging victorious in the second round grew, fuelling a much needed end of month rally across all emerging market asset classes.
In the May edition of the ITFA Newsletter you will find an interesting article entitled ''The Lighthouse Keepers'' written by Benyamin Ali of TFR. We are also printing the letter of support written by Mr. John Danilovich (Chairman of ICC), on the submission to UNCITRAL (United Nations Commission on International Trade Law) for recognition of the URF. UNCITRAL has adopted all the major rules relating to trade finance such as the UCP and, whilst the process is a little dry, the submission is an important reminder of the continuing reliance of our core product. You will also find our regular feature - Chart of the Month, contributed by Dr. Rebecca Harding of Equant Analytics. Furthermore, ITFA updates its readers on the CEE-CIS regional event which took place in Vienna on 5th April 2017.
Conference season is well and truly upon us but I take this opportunity to remind you that the very best of them all (you will forgive my slight exaggeration), the annual ITFA shindig, will be held in Edinburgh between the 6th and 8th of September 2017. This year we will be greeting you at the Caledonian Hotel, which is situated in the heart of Edinburgh. At this point we urge you to Save the Date and to keep following our regular updates. As always, ITFA ensures that this well-awaited annual event provides a perfect mix of education, information, networking and partying in just the right measures.
We look forward to hearing from you with any feedback you may want to share with us by sending an email to myself, any of the Board Members or to our general email, email@example.com.