On December 12, 2024, HSBC and the World Bank’s International Finance Corporation (IFC) announced the launch of a US$1 billion trade-finance programme aimed at addressing the significant trade-finance gap in emerging markets, which is estimated at US$2.5 trillion [72560ebb]. This initiative will support trade transactions across 20 countries in Africa, Asia, Latin America, and the Middle East, reinforcing the importance of trade finance in fostering economic growth and sustainability in these regions. Riccardo Puliti, IFC’s regional vice president for Asia Pacific, emphasized the ongoing challenges posed by trade-finance gaps, while Aditya Gahlaut from HSBC highlighted the critical need to reduce these gaps to promote growth and sustainability [72560ebb].
This new programme is part of the IFC’s Global Trade Liquidity Program, which has successfully facilitated over US$80 billion in trade volume over the past 20 years. The collaboration between HSBC and the IFC underscores a commitment to enhancing trade finance availability, which is vital for the economic development of emerging markets [72560ebb].
In a related context, the International Islamic Trade Finance Corporation (ITFC) has also been active in supporting economic recovery and sustainable growth among its member countries. In its 2023 Annual Report, ITFC revealed that it approved $6.9 billion in trade finance, with a focus on diversifying beyond traditional sectors. The organization provided substantial finance approvals of $905 million to support SMEs and private sector entities, fostering entrepreneurship and job creation [6498a257].
Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, recently assured full support to ITFC for diversifying its portfolio in Pakistan during a meeting in Washington on October 24, 2024. ITFC plans to provide USD 3 billion for commodity financing over three years, with an immediate USD 269 million through direct financing and syndication. Aurangzeb highlighted positive economic indicators driven by a successful Stand-By Arrangement (SBA) and discussed reforms aimed at improving the tax-to-GDP ratio and reducing energy sector losses [01e9d234].
Both initiatives reflect a growing recognition of the importance of trade finance in enhancing economic resilience and promoting sustainable growth in emerging markets, with organizations like HSBC, IFC, and ITFC playing pivotal roles in this effort.