The web-based solution, called Global Trade Konnect (GTK), was conceived as a combination of Komgo’s most successful products over the past six years and will function as a full-stack solution for corporates looking to take control of their trade finance operations. 

As international tensions rise and fears of a global recession come closer and closer to reality, companies are rushing to strengthen their risk strategies. Trade finance can play a crucial role in increasing resilience and optimisation – but challenges like information misalignment, inefficiency, and fragmentation can make processes much slower and more complicated than they need to be.

This means having the correct tools to handle internal processes and overcome these challenges is becoming more and more important. Through GTK, Komgo proposes a scalable, smart, and connected solution to simplify daily trade finance operations through digital management. 

GTK is intended as a combination of a series of Komgo products covering all aspects of the trade finance pipeline and its instruments, from standby letters of credit to corporate guarantees and contracts. Capabilities from @Globaltrade, the platform Komgo acquired with GTC, will be combined with the secure communication channel and longtime Komgo staple Konsole APIs, digital document layer Trakk, and AWS’s advanced cloud capabilities.

Through streamlined and secure communication channels, companies will be able to replace emails, paper documents, and wet-ink signatures with a single digital workflow. This will enable them to manage the entire life cycle of thousands of trade instruments all in one place, which will be integrated with a range of communication channels to enable connectivity with all financial institutions. 

Advanced AI integration will drastically increase efficiency, accelerating manual processes by at least 50%. Automatic letter of credit drafting and checking, fee calculation, and bank guarantee issuance will streamline processes, while accurate and timely notifications will make it possible for even non-automated steps to be completed more quickly.

GTK’s reporting capabilities will make it easier to generate operational reports and analytics, and the data it generates will give companies the power to make accurate forecasts and improve their decision-making. 

Through GTK, Komgo has harnessed the power of the most exciting technological advancements – document digitisation, interconnectivity, and AI – to produce a copilot for corporates looking for a way to manage their trade finance activities. In today’s highly fragmented, fast-moving world, companies must be flexible and resilient. GTK promises to bring the best of Komgo to help them navigate this.

The post Komgo launches Global Trade Konnect, next-generation all-in-one trade finance solution appeared first on Trade Finance Global.

The biannual report described decreased expectations of global GDP growth and rising volatility; policy uncertainty, geopolitical risk, trade barriers, and fragmentation unsurprisingly emerged as the main threats to trade in 2025 and beyond. 

Perhaps the most consequential finding of the report is a revision of past predictions of global GDP growth, which would have seen it slightly rise to 3.3% from 2024’s 3.2% and hold steady in 2026. Due to increased uncertainty and rising trade barriers, growth is instead now projected to slow to 3.1% in 2025 and 3% in the following year. 

This is driven by a significant slowing in US growth, projected to decrease by a full percentage point from its current level in 2026, and similar slowing growth in G20 countries. Developing countries will be the ones driving growth, with India, Indonesia, and Türkiye all rapidly increasing the size of their economies. Slowing growth may help decrease inflation globally, which remains above the targets set by central banks in many countries.

While uncertainty has been increasing worldwide, with consumer confidence hitting 2-year lows in much of the Americas, trade policy uncertainty has increased exponentially in recent months, the report found. This is likely related to President Trump’s tariff plans, which threaten to impose heavy duties on the US’s main trading partners in an effort to boost domestic producers and make trade fairer. 

After a series of false starts, in which tariffs against Mexico and Canada were quickly levied and just as quickly lifted, the Trump administration has promised a sweeping tariff regime to go into effect on 2 April, nicknamed “liberation day”. Mexico and Canada were most affected by the rise in uncertainty; these two countries, as well as the US and Brazil, experienced slowing growth in the past months, mainly driven by the services sector shrinking.

Increased tariffs aren’t just affecting uncertainty. The OECD predicts that tariffs were they to go ahead, will be “a drag on global activity” and “add to trade costs, raising the price of covered imported final goods for consumers and intermediate inputs for businesses”. This effect will be amplified in regions with highly international, integrated supply chains, as the North American market is, potentially multiplying the effect of tariffs and driving unprecedented supply chain transformation. 

On the flip side, the OECD report sees potential for sustained growth if tariffs were removed and technology harnessed to boost productivity. An optimistic prediction of high AI adoption with robotics integration is projected to add over 1.4% to annual labour productivity over 10 years, while a more modest prediction of high integration with adjustment frictions is still expected to add over 0.6%. The report also highlights the importance of encouraging competitiveness in domestic economies, a measure which has consistently gotten better over the past 6 years; the UK has maintained its position as the most competition-friendly of the countries surveyed. 

While the risk of tariffs and a retaliatory regime that might give way to an all-out trade war could be destructive, international cooperation could open the door to rising growth. Diversification, and strengthening supply chains will be a useful stopgap for firms affected by the tariffs and should be encouraged by national policies. However, a sustained effort to reduce fragmentation and multilaterally lower tariffs is the only thing that will bring the global economy back to sustained growth. Geopolitical risk, driven by conflicts in Europe and the Middle East and their effect on trade routes and energy prices, contributes to an undercurrent of volatility and uncertainty; developments in those conflicts or other simmering global conflicts could further contribute to rising or lowering consumer confidence and uncertainty.

The report paints a sobering but potentially optimistic picture for the months ahead. While fragmentation and tariffs are driving uncertainty and slowing growth, technology and cooperation can have a mitigating effect and contribute to higher productivity. 

The first takeaway from the report, then, is that once again, trade and tariffs dominate global economic developments; trade barriers and geopolitical risk can have destructive effects worldwide, but will also be the key to promoting growth. Unlike the global disruption brought on by the pandemic, which seemed like a sweeping, uncontrollable force, or last year’s geopolitical volatility that was hard to contain or predict, 2025’s global challenges are entirely within the international community’s control – as is fixing them. 

The post Fragmentation and uncertainty are biggest risks to global trade, says OECD appeared first on Trade Finance Global.

Just weeks after the two countries resumed talks, Nidhi Tripathi, economic minister in India’s High Commission in London, reported on Thursday 20 March that the UK and India are “very close” to agreeing on an FTA. This agreement will bring a degree of stability, as both countries look to reroute around tariffs from key trading partners, in particular the US.

Bilateral trade between the UK and India was valued at £40.9 billion in 2024, an increase of 8.6% from the previous year. In this period, India was the UK’s 11th largest trading partner; the UK was India’s 16th largest trading partner.

The negotiations with New Zealand, while smaller in scale, are equally strategic.

After a decade-long impasse, New Zealand Prime Minister Christopher Luxon launched a five-day diplomatic tour in Delhi and held bilateral talks with Indian Prime Minister Narendra Modi on 16 March.

The two nations have agreed to commence the first round of negotiations next month, with Luxon describing the restart as a “major breakthrough” that could potentially double New Zealand’s exports within a decade. 

Currently, bilateral trade between the two countries stands at under $2 billion, but both sides see significant potential for expansion across multiple sectors. It provides India with enhanced access to agricultural and dairy markets while offering New Zealand improved entry into India’s burgeoning technology and services.

The negotiations, which originally began in 2010 but stalled over market access issues—particularly New Zealand’s desire to enter India’s traditionally protected dairy market—reflect India’s recent shift towards more open bilateral trade agreements, particularly in the context of countering China’s influence in the Indian Ocean region and diversifying its international economic partnerships.

The post India pushes ahead with free trade agreements with UK and New Zealand appeared first on Trade Finance Global.

Listen to this podcast on Spotify, Apple Podcasts, Podbean, Podtail, ListenNotes, TuneIn

Estimated reading time: 5 minutes

As recent news makes strikingly clear, today’s world is becoming increasingly volatile and fraught with risk. Being part of the trade industry in this unstable geopolitical environment requires adaptability, resilience, and risk management, making insurance more necessary than ever.

At the annual Women in Trade, Treasury, and Payments Conference on 27 February, Trade Finance Global (TFG) spoke to Sanda Blanco, Head of Structured Credit, Political Risks and International Bonding at Howden, about the most important political risks of our time and how bespoke insurance can help businesses thrive in face of them. 

A new world order

While the international geopolitical landscape is inherently volatile, the last few years have seen unprecedented shifts at breakneck speed. From conflicts to regime change and economic shocks, constant change has made it more and more difficult to predict what’s coming next and adjust to it. “I have witnessed this – conflicts, wars, financial crisis – but not all at once with this global reach,” said Blanco.

In the past 20 years, the world has also become more interconnected than ever – meaning shocks in one region quickly send waves across entire industries around the world. The world’s growing reliance on international trade, for example, meant that the Russia-Ukraine conflict had profound consequences on food supply around the world, from Europe to Africa; other conflicts near crucial trade routes or economic shocks in large economies can also have immediate, almost unpredictable effects on countries thousands of miles away. 

This change has effectively led to a “new world order” and caused a decline in trust among nations, institutions, and politicians. Fear of change has increased polarisation – as recent US and German elections show – and eroded trust between people, making the global situation even more precarious.

Bespoke risk management: the way forward

With more unpredictability comes more risk, which businesses must monitor and mitigate to stay afloat. Insurance brokers and underwriters, like Howden, can help by forging relationships between companies and insurers and helping companies find the coverage they need to continue working. 

Howden focuses on long-term insurance, creating bespoke solutions for clients tailored to their specific needs. This means the Howden team must get to know the client, insurer, and the underlying transaction thoroughly to create a solution that addresses the client’s needs and risk appetite. This is what makes the relationships between brokers and clients so crucial, especially in a world where trust is dwindling: only through strong, collaborative relationships can brokers understand the client’s needs and how underwriters’ products can match up with them. 

The future of risk: tech, diversity, and inclusion

As insurance becomes increasingly important, so does ensuring that all companies have access to the right type of coverage. Leveraging technology is crucial to connecting firms to insurance providers, enabling them to find solutions that work for them without having to go through long, inefficient processes. 

Howden has been building a range of platforms to provide businesses, especially small and medium-sized enterprises (SMEs) with specific insurance cover, like a recently announced platform to protect UK firms against renewable energy risks, or two unique digital platforms: Tepfin X, a Lloyd’s of London approved trading platform and a completely new way for its clients to access the Structured Credit & Political Risk Insurance market for their high volume businesses. The aim of this was to overcome the traditional inefficiencies of the insurance market in quoting and placing these business lines, to give clients instant certainty and speed of access to available insurance capacity, which they can leverage to maximise the value of their commercial opportunities and Dynamite, a data management system for Structured Credit & Political Risk Insurance.

Increasing accessibility will only become more important in the next few years as demand for political risk insurance is set to soar. Even though many businesses are slowing down on globalisation, instead resorting to nearshoring and restructuring supply chains to decrease geopolitical risk, global uncertainty remains high. 

This is likely to lead to a boom in political risk insurance, an inherently countercyclical industry: “The safer the world looks like to banks, traders, and investors, the less the clients feel they need to buy political risk insurance,” said Blanco. Vice versa, increased risk means increased demand for insurance cover; the industry’s profits will depend on the insurers’ appetite, capacity, and prices, as well as the different types and levels of coverage they offer. These may need to change over time, adjusting to new risks cropping up globally and adapting to clients’ demands.

Looking inward, the insurance industry must also continue in its progress to include more women in leadership roles: a recent survey found that only 37% of boardroom positions in Europe’s top insurance companies are held by women, and 80% of insurance companies have women make up less than a third of executive teams. Diversity, Equity, and Inclusion policies are doing some of the work in drawing attention to and decreasing the gender gap. 

Some women, however, have taken matters into their own hands: Blanco founded a group for women working in international bonding and guarantees, which grew to have 50 members just a year after its founding. The group lets women in all positions, ages, and areas of the sector meet each other and offer advice and support: “It’s so rewarding to see the impact that your own experiences, the good and the bad ones, can make in someone that is only starting in the sector as a woman,” said Blanco. 

The post PODCAST | Thriving amidst turbulence: The role of bespoke insurance appeared first on Trade Finance Global.

Uzbekistan, one of Central Asia’s major economies, is placing itself and the centre of growing regional trade by reintroducing factoring services to its banks. On behalf of Trade Finance Global (TFG), Madina Nurmatova, Project Manager at IFC, spoke to Foziljon Ulashev, Director of the Small and Medium Businesses Department at Aloqa Bank JSCB, at the ‘Exploring Receivables and Payable Finance conference,’ hosted by FCI, IFC, and the Central Bank of the Republic of Uzbekistan. They delved into the role of the factoring industry in boosting Central Asian trade. 

Factoring: the road to trade

As mandated by a decree announced in August, Uzbek banks are now required to offer factoring services, which allow clients to sell their outstanding invoices and access immediate cash flows. This is crucial for small and medium-sized enterprises (SMEs) wishing to export to neighbouring countries, as it allows them to enter the world of trade while minimising risk, uncertainty, and long waiting times. 

Factoring services provide much-needed lifelines for SMEs, explained Ulashev: “The amount that the clients received through factoring services allows them to ensure the continuity of the subsequent manufacturing processes, to refill their working capital, to increase the scale of production, to make payments to the subsequent entities down the value chain”. Without factoring, businesses will have much longer turnaround times and will struggle to expand their operations or diversify. 

This will not only boost SMEs in Uzbekistan but is expected to have an important impact on trade around the region. Central Asia, a long-neglected area in the shadow of China and the oil-rich Middle East, is having a renaissance as investors look to its large, untapped client base and growing economy. However, regional trade remains much lower than it could be due to poor infrastructure and historically high barriers to trade: moves like Uzbekistan’s factoring push will be key to bringing the region forward and attracting foreign investment. 

Aloqa Bank’s innovation

Aloqa Bank is at the forefront of the growing factoring industry in Uzbekistan, which promises to reshape regional trade finance by reintroducing services that cater to the fast‐paced needs of SMEs. 

With a factoring market potential estimated at almost $2 billion, the new digital factoring service is aimed at unlocking liquidity quickly and efficiently. Factoring provides immediate funding for businesses with tight margins and contributes to reducing recorded debts, increasing the turnover of money within the economy.

Since the decree this summer, Uzbek banks have rushed to improve and modernize their factoring services. The bold regulatory move has encouraged banks like Aloqa Bank to innovate, launching an online platform that allows business clients to submit electronic applications for factoring. The process is entirely digital, eliminating the need for physical visits to bank branches and cumbersome paperwork—a vital upgrade for SMEs operating on tight schedules.

The bank’s online platform is integrated with external systems that automatically review key documents such as invoices, contracts, and reconciliation statements. This technological integration helps determine the payor’s solvency through a scoring analysis guided by pre-set stop factors. The system then decides if the factoring service can be provided, issuing contracts and acknowledgement forms to both the vendor and the payor electronically. As a result, the turnaround time for financing is remarkably short.

“The convenience of factoring services for the business entities is in the absence of a need for additional documents, [the] short time of getting the financing processed, [and that entities are not required to provide additional collaterals,” said Ulashev.

This rapid processing is critical for SMEs that need to secure funds swiftly to maintain production continuity, expand operations, or simply manage cash flow gaps. Factoring services offered by Aloqa Bank come with flexible terms—up to 30 days at a discount rate of 2.5% and up to 90 days at a discount rate of up to 8%. In 2024, the project facilitated about $1.5 million in trade; it is projected that in 2025, over $23 million worth of trade will be financed with this service. 

Switching on digital trade finance

Such aggressive targets align with broader economic reforms in Uzbekistan, aimed at opening the country up to trade and attracting foreign direct investment that will be crucial for sustained growth. The country has been actively implementing market-oriented reforms since 2017, including liberalising the exchange rate, reducing import tariffs, and simplifying business regulations.

The shift toward digital trade finance solutions in Uzbekistan is supported by a broader government push to modernize the financial sector. Initiatives to improve transparency, reduce bureaucratic hurdles, and integrate digital tools into everyday banking operations are part of the ongoing reform agenda. It is hoped this will turn Uzbekistan into the region’s financial hub, leading innovation and providing services to businesses from across Central Asia. 

As the factoring market develops, competitors and fintech companies are also entering the space, driving innovation and further improving service delivery. Although the Central Asian market is still in its early stages compared to mature economies, the aggressive targets set by banks like Aloqa Bank illustrate a clear vision for the future of trade finance in Uzbekistan. With the government’s backing and the increasing digital literacy of local businesses, the new era of digital factoring is poised to make a significant impact on the Uzbek economy.

—- 

The reintroduction of factoring services in Uzbekistan is set to be an important step in increasing regional trade and is emblematic of a wider effort by Uzbekistan to modernise the country’s financial sector and place it as a leader of regional innovation. The digital factoring program by Aloqa Bank represents a critical step in encouraging SME growth and boosting trade. 

With clear government support, robust technological integration, and a focus on maintaining strong business relationships, the new platform is set to play a vital role in supporting national and regional economic growth for a long time.

The post VIDEO | Uzbekistan opens the doors to $2bn factoring industry appeared first on Trade Finance Global.

Listen to this podcast on Spotify, Apple Podcasts, Podbean, Podtail, ListenNotes, TuneIn

Estimated reading time: 5 minutes

AI holds the power to transform trade, offering opportunities to enhance efficiency, reduce costs, and empower smaller players in the global market. However, it also introduces complexities and ethical dilemmas. The question remains to be seen: will it bridge gaps, lower barriers, and drive innovation? Or will it create hurdles, deepen inequalities, and exacerbate existing challenges?

The promise of AI reshaping trade and services

When most people imagine AI in a business setting, they picture large tech giants or multinational firms leveraging cutting-edge AI tools to optimise processes and outpace competitors. While larger firms tend to be at the vanguard of the technology’s development, the potential benefits reach smaller businesses as well.

Ganne said, “AI can transform raw data into actionable insights, whether it’s optimising logistics, automating customs and compliance processes, or predicting supply chain disruptions.”

At the state level, countries with limited resources can expand their role in international trade by reducing inefficiencies and cutting costs. This creates opportunities for smaller economies to compete in markets traditionally dominated by larger, wealthier nations.

Ganne said, “AI can reshape countries’ comparative advantages. New competitive advantages could emerge from factors like educated labour, digital connectivity, favourable regulations, or even abundant energy.” Such factors can help them emerge as leaders in this transformative space. The potential for growth and innovation is immense as nations work toward a more connected and equitable global marketplace.

Facing the challenges that come with AI

The technology’s inherent complexity introduces risks, particularly the opacity of its decision-making processes. This “black box” phenomenon of traditional models makes understanding or predicting how AI arrives at its conclusions difficult. Such uncertainty can undermine trust and lead to unintended consequences.

Ganne said, “There is a big challenge to regulate AI and ensure that it is trustworthy, meaning that it meets expectations in terms of reliability, security, privacy, safety, and accountability.”

Ethical concerns also loom large. AI systems are prone to biases that reflect the limitations or prejudices of their training data. These biases can perpetuate stereotypes and create disparities, especially in regions already struggling with inequality. 

This is where regulatory challenges come to the fore, as existing frameworks were designed for human decision-making, not the evolving behaviours of machines. The question of intellectual property further complicates the picture. When AI generates content, who owns it? 

Ganne said, “AI systems rely on vast amounts of data to learn and improve. If that data includes copyrighted material, like books, images, and software code, was permission obtained to use it?”

Balancing innovation with oversight requires a delicate approach. Policymakers must craft regulations that encourage AI’s development while protecting against its potential misuse. Without such balance, the challenges could overshadow the opportunities.

The growing gap between those with AI and those without

While AI opens doors for some, it risks shutting them for others. 

Advanced economies, with their robust digital ecosystems, skilled workforces, and substantial investments in research and development, are able to fully exploit the potential of AI. These countries are not only developing AI but also controlling the data and technology needed to fuel it, consolidating their advantages in trade and economic growth.

Meanwhile, lower-income countries face significant barriers. Without reliable high-speed internet, advanced computing power, or adequately trained professionals, these nations struggle to integrate AI into their economies. This lack of access prevents them from benefiting from the efficiencies and opportunities AI creates, leaving them further behind in the global market.

Ganne said, “The concentration of the AI value chain, with players like NVIDIA, TSMC, or ASML controlling 80% of the market, raises significant concerns about equity and access.”

Moreover, the concentration of AI expertise and resources in a few countries exacerbates this inequality. 

Ganne added, “Only a few players control the rich datasets that actually fuel AI. Without cooperation to address these issues at a global level, the gap between AI haves and have-nots is likely to grow wider.”

This is why targeted and collaborative global efforts to democratise AI are needed.

Why the world needs to work together on AI

The world needs to work together on AI to prevent disparities and inequalities from becoming more pronounced because AI’s potential benefits are immense, but they risk being unequally distributed. 

By collaborating, nations can share knowledge, expertise, and best practices to ensure AI technologies are accessible to all. Unified global standards and regulatory frameworks would help smaller and developing countries adopt AI in ways that align with ethical guidelines, data privacy, and safety measures. 

Trade rules, while technology-neutral, already cover aspects of AI, such as eliminating tariffs on critical components or supporting cross-border services. However, the fragmented approaches taken by individual countries create inefficiencies and inconsistencies.

Ganne said, “What we urgently need is cooperation to promote regulatory convergence.”

By fostering dialogue, sharing best practices, and creating unified standards, nations can avoid the pitfalls of regulatory fragmentation. Equitable access to AI technologies depends on proactive policymaking that prioritises inclusivity and shared progress.

Ganne said, “The WTO, as a global forum for cooperation, dialogue, and exchange of good practices, can play an important role in fostering global convergence.”

By working together, countries can ensure AI serves as a tool for uniting rather than dividing the global trading system.

–

AI has the potential to redefine international trade, unlocking new opportunities and transforming the way economies interact. Yet, this transformation is not without its challenges. The hurdles, from ethical dilemmas to growing inequalities, are significant but not insurmountable.

The future of AI in trade depends on how nations and organisations approach these challenges today. Cooperation, inclusivity, and thoughtful regulation will be key to ensuring AI’s promise outweighs its risks. 

Whether AI helps or hinders international trade will ultimately be determined by the choices made now. The opportunity to shape a more connected and equitable global market is within reach, but it demands collective effort and vision.

The post PODCAST | Will AI help or hinder international trade? appeared first on Trade Finance Global.

Africa has been in increasing its foothold in the global economy for a number of years. With the Global South enjoying new influence and wealth, the world’s economic centre of gravity is no longer under Western dominance. The volume of South-South trade has now surpassed the volume of North-South trade, reaching US$5.3 trillion – showcasing the growing connections between countries in the Global South. 

The South-South shift is not just about increasing trade volumes, but about an evolving landscape with highly diversified economies. Africa is rich in natural resources but is also actively diversifying its economic activities, with fast-growing sectors like telecommunications, energy and renewables, and Agri-tech taking the reins. The Gulf Cooperation Council’s (GCC) own journey towards economic diversification complements Africa’s aspirations for sustainable growth and infrastructure renewal. In this context, there stands a real opportunity for Africa and GCC states – to strengthen their ongoing relationship for mutual benefit. 

Double down on diversification

For GCC nations, these diversification journeys are not recent developments. Looking back at the Gulf’s own transformation, states like the UAE and Saudi Arabia have been transformed from desert landscapes into some of the world’s most advanced trade, logistics, finance and technology hubs by the end of the 20^th century, with both undergoing profound transformations. It is evident that over the past decade, unprecedented levels of economic progress, foreign and domestic investment, demographic growth and high-profile cultural and public-sector projects across the Gulf region have catapulted Gulf Cooperation Council (GCC) countries onto the global stage. 

Diversification – through ambitious projects to enhance infrastructure, real estate, and tourism – across GCC countries has been a successful strategy in unlocking new opportunities and revenue streams. Tapping into this further will remain a priority in years to come. An example is the Saudi Vision 2030, a government programme with the goal of diversifying the country economically, socially, and culturally. The vision includes forming new international partnerships, creating diverse job opportunities, and attracting global talent to build Saudi Arabia as a global trade hub. Similarly, the UAE’s Energy Strategy 2050 seeks to channel funding into energy efficiency, drive R&D and innovation in energy technologies, and encourage investment in the UAE’s renewables. 

Powering the GCC’s diversification goals

For Africa, the GCC’s focus on diversification and green initiatives represents an opportunity for collaboration and growth. Across the globe, environmental, social, and governance (ESG) standards are at the forefront of investment considerations, with climate initiatives remaining a top priority. The climate crisis continues to intensify, with stories of floods and droughts regularly gripping headlines worldwide. This is accelerating the urgency to transition to sustainable energy sources. 

Africa has an abundant resource base that can help power the GCC’s energy transition. The continent is home to around 30% of the world’s mineral reserves, including up to 90% of its platinum and chromium, alongside large deposits of lithium, phosphate, and nickel – and the global demand for these resources is escalating. As countries transition to renewable energy, the demand for critical minerals will increase due to their essential role in manufacturing batteries for electric vehicles and other clean energy technologies. This creates an opportunity for GCC nations and Africa to collaborate and secure the supply chain for the critical minerals that will drive the green energy revolution. 

GCC countries are in a prime position to bridge Africa’s infrastructure gap. Having built its metropolises from the ground up just decades ago, it has unparalleled experience in modern infrastructure development, and as such, unique insights into the infrastructure challenges that many African nations face. In recent years, the UAE and Saudi Arabia have invested heavily in Africa’s ports and logistics networks. 

As the UAE and Saudi have diversified, they are seeing more and more opportunity in Africa. In 2023 alone, GCC companies announced 73 foreign direct investment (FDI) projects in Africa, totalling more than $53 billion.

The UAE’s Dubai Ports World (DP World) has built and expanded key ports to streamline logistics and supply chains, helping Africa to connect more efficiently with global markets. Its projects—like those in Senegal, Egypt, and Tanzania—offer direct improvements to trade routes, cutting down both time and costs for goods moving in and out of Africa. 

A golden age of Global South growth

Collectively, GCC countries have invested over $100 billion in Africa over the past decade, as they continue to cement long-term partnerships with African governments and businesses. Combining efforts to diversify and expand will unlock new opportunities for economic development and resilience—and herald a new dawn in South-South cooperation. 

The post In the Global South’s new renaissance, Africa and the GCC can lead the charge appeared first on Trade Finance Global.

This approach enables factoring companies to implement solutions faster and with fewer resources, allowing them to begin offering factoring services to their clients, such as SMEs and corporates, more efficiently.

By providing pre-configured modules and features, ready-made factoring software simplifies implementation and streamlines key processes, such as handling receivables and invoices entered by entrepreneurs. 

The standardised nature of these solutions typically comes with pre-determined terms, fee structures, and documentation, making the software deployment relatively straightforward (compared to a fully customised offering). This is particularly valuable for banks and factoring institutions aiming to expand their services or transition from an older system without the delays associated with extensive IT development projects.

However, as is often the case, simplicity and speed can come with trade-offs. While good off-the-shelf software does not preclude requests for changes or new functionality over time, the standardised approach may limit the ability to tailor the system to fit specific operational requirements or market nuances, posing challenges for organisations with particularly complex or unique workflows. 

Karol Leszczyński, Product Development Manager at Comarch Factoring Platform, said, “When implementing off-the-shelf software, the process is mostly agile-oriented, allowing requirements to adapt to changing circumstances as the project progresses. 

“With a ready-made solution, clients receive a standardised version of the system early on, enabling them to gradually assess its features and determine the necessary customisations. The biggest advantage of this approach is that they can start generating revenue from the new system at an early stage and, if needed, tailor it further to their specific needs.”

What to consider when implementing a ready-made factoring system

Implementing ready-made factoring software can still be a long process, sometimes taking upwards of 3-6 months, depending on the scope of integration and the degree of customisation required. While these systems offer efficiency and ease of deployment, the process involves balancing standardisation with the specific demands of the business and its regulatory environment.

A key consideration is evaluating how well the off-the-shelf solution aligns with the existing processes and strategic goals of the factoring institution. Although ready-made systems are designed for broad applicability, they may not fully meet a company’s operational needs without some level of adaptation. Identifying essential features—particularly those tied to a company’s unique offerings—can help determine whether additional customisation is necessary.

Compatibility with local market conditions and regulations is equally important. Factoring companies operate in environments with varying tax laws, payment structures, and data privacy requirements. Ensuring that the software can adapt to these local nuances is crucial to a successful implementation.

The choice of implementation methodology also plays a significant role in determining outcomes. Traditional approaches like waterfall offer a clear, structured roadmap, while more iterative, agile models provide flexibility to address unforeseen challenges. Agile methodologies are particularly useful when extensive customisation or ongoing adjustments are anticipated.

Additionally, the transition to any new digital tool – ready-made factoring software included – often requires a cultural shift within the organisation. Employees used to legacy processes and systems will need training and support to fully embrace the new technology, making stakeholder engagement and change management essential parts of the process.

While the software itself may be ready-made, the implementation process is rarely one-size-fits-all.

Is ready-made factoring worth all the fuss?

This brings us to the question of whether ready-made factoring solutions are indeed worth all the fuss. “Before selecting a vendor for our new system, we first gathered all the requirements and customisations we wanted—there were around 600 items detailing what the software should include and how it should function. Initially, we planned to build the project scope around these specifications,” said Ewa Gawrońska-Micuń, Head of Strategic Marketing and Product for the CEE region, Country Manager Poland at Bibby Financial Services. 

“However, over time with the process of exploring the system, we realised that many of our needs can be met by the system’s features, without requiring customisation, in a different way that we designed.”

Proponents emphasise the speed and cost-effectiveness of these solutions, which allow banks and factoring companies to quickly begin offering factoring services without the high expenses of developing custom systems. The accessibility of pre-configured solutions can be especially beneficial for smaller financial institutions with limited IT resources. Moreover, the reliability of ready-made systems, combined with the ongoing updates and scalability provided by established vendors, ensures that the software can evolve alongside market needs.

“We approached the system with a clearly defined set of functionalities needed to meet the expectations of both our clients and our team,” Gawrońska-Micuń explained. 

“Exploring the out-of-the-box system and participating in functional workshops helped us identify potential gaps. Once we understood where those gaps were, we could easily decide whether customization was truly necessary or if it would be more effective to refine our existing processes to achieve the same result.”

However, critics point to the limitations of standardisation. Some ready-made systems may struggle to accommodate the unique processes or workflows of certain institutions, which can lead to costly customisations or workarounds. However, in the long term, as users become familiar with the out-of-the-box solution, many find that the pre-built processes are designed better than the ones they were used to before.

—

Further, if an implementation is not well planned in advance or a vendor lacks transparency, hidden expenses, such as fees for additional features or updates, can also erode the initial cost advantage. Furthermore, the one-size-fits-all nature of these solutions may hinder organisations that rely on tailored systems to maintain a competitive edge in complex or highly regulated markets.

“Allowing clients to thoroughly explore the system before implementation should be a standard practice in the deployment process,” Leszczyński explained. “During the functional workshop phase, they gain an in-depth understanding of the off-the-shelf solution. In our experience, clients often come in with a long list of customisations, but after familiarising themselves with the system, they frequently find that the existing features meet their needs.”

“A good vendor remains flexible, readily adapting to these changes and evolving the system together with the client based on their real needs,” he summarised. The value of ready-made factoring lies in its balance of speed, affordability, and reliability against compromises in flexibility and extensive customisation. Whether it is the right choice depends on the institution’s ability to adapt its processes to fit the system or justify the investment in customisation where needed.

The post Ready-made factoring: Fast-track finance or one-size-fits-none? appeared first on Trade Finance Global.

Most discussions of industrial policies centre on the manufacturing sector, overlooking the fact that services sectors account for much larger shares of almost every nation’s GDP. The service sector trade also continues to grow faster than goods trade. Yet little is known about the range of selective policy interventions deployed in services sectors. 

We leverage the World Trade Organization’s Trade in Services by Mode of Supply (TISMOS) dataset and match it to data on selective policy interventions from the Global Trade Alert (GTA), which implicates the services sector. This helps to shed light on selective corporate subsidy interventions and their potential link to service sector exports.

Services trade dynamics: Stylised facts from the TISMOS database

TISMOS classifies trade in services by four modes of supply:

1. Cross-border supply: Services are delivered from one country’s territory to another, without the movement of either the consumer or the producer. Only the service itself crosses the border. For example, a university in the UK offering online courses to a student based in India.
2. Consumption abroad: Services are provided within a country to consumers from another country. This includes individuals travelling to another country to access services, such as visiting museums, theatres, doctors, or attending language courses. It also encompasses services related to the consumer’s property while abroad, like ship repairs.
3. Commercial presence: Services are provided by businesses or professional establishments from one country through a commercial presence in another country. For example, a British bank opening a branch in India to offer banking and financial services to local customers.
4. Presence of natural persons: Services are provided by individuals from one country through their temporary presence in another country. Examples include a computer services company sending an employee to a client in another country, or a self-employed lawyer travelling abroad to offer legal advice.

While commercial presence remains the dominant form of service exports, there has been a shift since the COVID-19 pandemic in favour of cross-border supply. Although this shift might suggest that in-person service delivery has declined in favour of exchanges that do not require physical presence, the percentage change from 2017 to 2022 reveals an upward trend in both commercial presence and cross-border supply. 

Figure 2. Percentage Change World Exports of Services by Mode of Supply

The decline in the global share of commercial presence can primarily be attributed to a greater percentage increase in other categories. Foreign suppliers’ continued establishment of local affiliates signals that companies still value close contact throughout various stages of service delivery, including production, distribution, marketing, sales, and after-sales support. Additionally, there is potential for recovery in services provided within one country to consumers from another, as well as services related to a consumer’s property abroad. In particular, sectors such as tourism seem to have considerable growth potential.

The TISMOS database allows services trade to be broken down by major exporter. As per Figure 3, over 50% of global service exports come from the EU and the USA combined. In 2022, China accounted for only 8.2% of total world service exports. The implications of this high concentration in the service sectors are significant. First, trade partners may need to align with US and EU regulations to export services, giving these countries leverage over global trade standards and substantial bargaining power in trade agreements. For instance, while these trade partners do not need to fully align with such foreign regulations in the US or the EU and its member countries, they do need to provide a regulatory environment that allows domestic companies to adhere to them. Take for example Germany’s Supply Chain Act which mandates corporate and contractual due diligence obligations as well as their enforcement across borders. Countries which are considered high risk for breaking the Act’s conditions face divestment from large corporations. 

Simultaneously, there are also strategic opportunities for emerging markets to expand business sectors related to digital transformation and remote services, which can support economic diversification policy initiatives. Figure 4 reveals that China has experienced higher-than-average growth (126%) in cross-border supply service exports compared to the global total, particularly after 2020; the EU-27 also increased its exports by 57.8%. Despite these large increases, China’s share of world exports in 2022 remained less than 10% and was smaller than the previous year. Nevertheless, the surge in cross-border supply services shows that some emerging economies can potentially capture a larger share of the benefits from global service trade more easily.

What about services that require a commercial presence in another country? Figure 5 shows a significant increase in Chinese exports, although there was a retreat in 2022 compared to 2021. On the other hand, the US maintained its rising trend in 2022, while the EU’s exports performed below the world average. This highlights the strength of US multinational service firms, which continue to expand by setting up subsidiaries or acquiring foreign firms. US companies tend to prefer direct market entry or local presence over cross-border transactions. 

For example, IBM has established numerous research and development centres around the world, allowing it to localise its technology solutions and provide closer support to regional markets. Microsoft has established data centres worldwide to support its cloud services, ensuring low latency and compliance with local data regulations. Finally, McDonald’s exemplifies direct market entry by setting up thousands of franchises globally, adapting its menu to local tastes while maintaining a consistent brand experience. Despite the increasing share of Chinese service exports, US firms continue to dominate, maintaining a strong influence in global markets. However, establishing a physical presence abroad exposes US multinationals to political risks in host countries.

For the EU, stricter regulations such as the GDPR, financial regulations, and fragmented national markets make expansion less seamless compared to the US. One explanation is that services trade overall is considered two to three times more expensive than goods trade, with strong heterogeneity in trade costs across countries. Even more so, services trade has seen relatively little cost improvement in the last two decades while the costs for trade in goods continue to decline. Yet even when the EU seeks to introduce uniform regulatory frameworks to enhance trade conditions, it must first address a wide range of diverse national regulatory frameworks. The 2024 Draghi report has stated that this fragmentation of the single market was left untouched for too long and stressed the need to tackle the EU’s fragmented single market to remain competitive in the global economy. 

In China’s case, dominance in some digital platforms allows for direct online service exports, reducing the need for firms to establish operations abroad. Geopolitical tensions and investment barriers may limit Chinese firms’ ability to expand through foreign direct investment (FDI), but these challenges also drive them to focus on cross-border digital services. Recent trade restrictions, like tariffs such as the U.S. government’s export controls or the banning of Chinese telecom equipment by several countries, may also incentivise Chinese companies to establish operations abroad to avoid these barriers. 

For example, Türkiye has imposed higher tariffs on imported EVs while simultaneously offering incentives such as tax breaks, land grants, and subsidies to foreign manufacturers. This strategy aims to encourage Chinese EV companies, like BYD or NIO, to establish production facilities within Türkiye. In a similar fashion, the EU has introduced anti-dumping duties on Chinese imports of batteries and related components to protect its domestic battery industry. At the same time, it has established initiatives like the European Battery Alliance, offering financial incentives and regulatory support to attract Chinese companies, such as CATL and BYD, to set up battery manufacturing plants in the EU. These trade barriers could also present an opportunity for China to increase its commercial presence in certain markets, potentially leading to a shift in the global service trade landscape.

A deeper dive into selective subsidy intervention shaping service sectors

The GTA database is well suited to examine selective subsidy intervention favouring firms in services sectors. Consumer subsidies that do not have nationality-based discriminatory strings attached are not covered in the GTA. So, the focus here will be on subsidy receipt by services producers.

Since 2017 the most corporate subsidies awarded by China, the EU, and the US were to producers in the Business, Personal, and Manufacturing Services sector. This aggregate sector includes manufacturing services for physical inputs owned by others, intellectual property usage charges, business services (excluding trade-related), heritage, and recreational services, among others. The US is the jurisdiction that most often grants subsidies to companies in this sector, while the EU allocates the largest number of subsidies to the transport and travel services sector. China is the leader in subsidising the financial and insurance services sector.

Figure 7 explores the relationship between a country’s exports by sector and the number of subsidies awarded each year. The relationship is both positive and significant, with a correlation coefficient of 0.4. This indicates that China, the EU, and the US tend to subsidise sectors that have a larger volume of exports. While this does not establish the direction of causality, the finding is consistent with the following interpretation: subsidies are being strategically used to support services sectors with demonstrated comparative advantage. Further analysis could establish whether today’s service export success stories were supported during their nascent scale-up phase. 

Towards a better understanding of service sector promotion policies

Greater transparency is essential to better understand the trends and dynamics in the trade of services. The WTO’s TISMOS initiative, combining information on modes of supply, sectors, and trade flows, represents a significant step in this direction. Additionally, the GTA database tracks industrial policies and trade measures affecting the service sector. Much could be learned by combining these data sources—in this, we have only scratched the surface. 

Our findings suggest different country services providers prefer different modes of supply. The US, for example, continues to prioritise commercial presence, leveraging the strength of its multinational service firms and direct market access. In contrast, China is increasingly focused on cross-border supply, driven by its expansion in digital services such as software development, AI, cloud computing, and digital finance. However, whether rising trade barriers will incentivise China to establish a stronger commercial presence in certain importing countries remains to be seen.

Furthermore, China, the EU-27, and the US tend to grant more subsidies to service sectors where their exports are largest, suggesting that industrial policies in these countries could well be reinforcing strategic competitive advantages.

—

As the world enters 2025, the trends identified between 2019 and 2022—particularly the shift towards cross-border service supply and the growing influence of China in digital services—are expected to continue shaping global trade dynamics. Rising geopolitical tensions and new looming trade barriers promised by the second Trump administration may encourage countries like China to further expand their commercial presence in foreign markets, adapting to the changing regulatory and political landscape. Meanwhile, the EU and US are likely to maintain their focus on subsidising key service sectors with competitive export advantages, continuing to leverage selective policies to secure their positions in the global service trade.

The post Subsidies for services: Insights from the TISMOS and GTA Databases appeared first on Trade Finance Global.

The partnership will see MonetaGo’s Secure Financing system, which helps lenders detect duplicate financing and falsified documents, embedded within Oracle’s existing suite of products. 

“Fraud exists in every jurisdiction we operate in. Collaborating with Oracle is a tremendous step in strengthening the security of trade and supply chain finance,” said Neil Shonhard, chief executive of MonetaGo. He added that the partnership would “offer the gold standard for combating fraud” in the sector.

The integration will initially focus on the Middle East, Africa and Asia-Pacific regions, with plans to expand into Europe and the Americas. The system employs document fingerprinting and data authentication techniques to verify trade-related documents before financing decisions are made.

The system, which adheres to UN/CEFACT reference data models and ISO 20022 standards, creates unique fingerprints of documents and checks them against a universal registry to identify potential duplicate financing attempts. It operates in partnership with Swift and is accessible through various channels including API integration.

Oracle’s existing supply chain finance solutions provide banks with tools to manage trade finance operations, including both conventional and Islamic trade finance products. The addition of MonetaGo’s technology is expected to enhance the platform’s fraud prevention capabilities at a time when digital trade finance solutions are becoming increasingly crucial to global commerce.

Sovan Shatpathy, senior vice president at Oracle Financial Services, highlighted the importance of evolving their solutions through partnerships with fintech firms. “MonetaGo’s fraud prevention technology augments our robust risk management capabilities”, he said, noting that it would help financial institutions “run trade and supply chain operations at scale”.

The post MonetaGo and Oracle collaborate to combat trade finance fraud appeared first on Trade Finance Global.