EXPERT GROUP MEETING ON TRADE FINANCE – 25 APRIL 2014
INFORMAL REPORT BY THE WTO SECRETARIAT
1. The objective of the April 2014 meeting was threefold: (i) to take stock of the current market situation, with a focus on factors such as liquidity, risks and price patterns by countries and regions (ii) to consider progress on prudential and non‑prudential regulatory issues (iii) to examine possible trade finance issues that may be of G‑20 interest during the Australian Presidency and beyond.
2. In his opening remarks, the Director-General of the WTO underlined the importance he attached to this direct dialogue, and of keeping the channels of communications open. Although trade finance did not feature in the WTO's core text, there was no doubt about the centrality of this work for the institution, a message confirmed by the Chair of the WTO's Working Group on Trade, Debt and Finance. The Director-General said that all recent evidence had pointed to continued difficulties for developing countries in accessing trade finance, in particular in the smallest and/or the poorest, and even for SMEs in larger and more developed countries. While the WTO had been, and is continuing, to support multilateral development banks (MDBs) in filling part of this market gap, there was a structural risk that production and trade opportunities of developing countries be undercut, because of the inability of the local and international financial sectors to support such new trade. The Director-General is open to taking an advocacy role where necessary. However, to be truly effective, any support by the Director-General would require (1) the support of WTO Members; (2) well-built, documented and fact-based cases demonstrating difficulties for traders; (3) effective communication; and (4) practical solutions that could be supported by the international community, though various fora, the G-20 or others. The expert group had an important diagnosis and advisory role to play in this regard. He looked forward to further engagement with the group.