$1.5 trillion global trade finance gap affecting SDG targets

(Down to Earth, New Delhi, 4 September 2019) A stubbornly high $1.5 trillion global trade finance gap is hampering efforts to achieve the United Nations-mandated sustainable development goals (SDG), especially those pertaining to women’s economic empowerment, job creation and inclusive growth, according to a report by the Asian Development Bank (ADB). The sixth-edition of the Trade Finance Gap, Growth, and Job Survey released on September 3, 2019, is based on responses from 112 banks from 47 countries, 53 export credit agencies from 17 countries and 336 firms from 68 countries. The large market gap for trade finance has affected women entrepreneurs more than men as they face the most rejection while applying for trade finance to expand their operations. The report showed that applications of 38 per cent male-owned firms were rejected, while for women entrepreneurs it was 44 per cent. Once rejected, 60 per cent women-owned firms were less likely to seek alternative finance.