Fragmented, but not broken: The state of global trade in 2024

Sep 11, 2023 | International

International trade is naturally dispersed. The world has 7 continents, 195 countries, 360 million square kilometres (139 million square miles) of ocean, and 38 time zones.

Due to barriers, the industry rarely meets in person. But Sibos lets us do that once a year.

The conference is embracing this idea this year. We are discussing “Collaborative finance in a fragmented world”, a timely topic.

The world is still recovering from COVID-19, supply chain breakdowns, geopolitical turmoil, and the outbreak of a violent war in Ukraine.

A report by the Asian Development Bank indicates a rise in the trade finance gap from $1.7 trillion to $2.5 trillion. Despite industry efforts, the gap widens with no clear plan to close it.

2024 may also change the global system. If you count the UK’s January 2025 election, over 31 countries will hold presidential, prime ministerial, or chancellor elections next year.

That’s why collective action has never been more important and why Sibos is so important for the industry to share lessons, ideas, and solutions.

The world seems to go in many directions, but it’s better than it looks. The industry is working together to solve new issues.

In the face of rising interest rates and economic uncertainty, traditional lenders are pulling back, and supply chain finance has moved beyond banking models.

Cross-border payments, a Sibos topic, have also changed drastically. Systems that once hampered businesses are being simplified and transparent. This change is a result of industry collaboration to simplify global payments.

The urgency of climate change must be addressed. Due to this urgency, the trade finance industry has taken action to expand carbon accounting and align surety with ESG efforts.

ESG brings people together beyond climate change. TFG hosted “LGTBQ+ in Trade, Treasury & Payments” to address an issue that is often overlooked in our industry. LGBTQ+ people, especially in international trade, must hide their identities for fear of losing their jobs. This panel brought together TTP leaders who shared insights and personal stories from which we can all learn.

The emerging digital frontier has been and will remain the elephant in the room. The main topic of Sibos 2023 will be the driving force behind many international trade developments in 2023.

The transition to digital platforms requires collaboration from all stakeholders to improve consumer experiences, interoperability, and security.

This transformation began. One of the UK’s most significant international trade laws was recently passed. On September 20th, the Electronic Trade Documents Act will take effect, paving the way for industry-wide digital transformation.

This edition serves as a call to action, preparing for the collaborative dialogues at Sibos 2023. Our challenges are huge but manageable.

As always, TFG thanks our sponsors and industry partners for their thought leadership and collaboration in creating this magazine’s content.

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