Approaches to standby letters of credit (standbys) and guarantees differ in different parts of the world. People perceive things differently, and that has an impact on how practice evolves. Take for example the Americas where standbys are generally used when issuing a guarantee undertaking. In Europe, however, (and for that matter in other parts of the world) guarantees serve the same purpose.
WebPort Global is a new and exciting online trade network created for companies and members of World Trade Centers, Chambers of Commerce, Professional Associations, and any organization that participates in or supports importing and exporting.
The article by Carlos Bacigalupe in the last edition of Trade Brief highlighted the advantages of Supply Chain Finance (SCF) and in particular how new methods of funding trade via SCF and Trade Receivable programmes are greatly assisting the improvement in liquidity and working capital for both buyer and supplier alike. Whilst it is true that since its inception some ten years ago SCF is primarily used in developed countries, such is the growing popularity of SCF with key multinational buyers that many suppliers located in emerging markets are now beginning to benefit financially from the introduction of SCF programmes.
Traditionally, trade finance has been provided to import/export companies by banks and/or other financial institutions. Such dependency of the financial sector adversely affects to both importers and exporters in their needs to get either funding or credit, especially in downturn times. Actually, in any financial crisis, the inevitable shortage of cash and credit imposed by banks to their clients implies an additional burden to producers and/or manufacturers adding such lack of financing to the problems experienced by the effect of the crisis. We all know examples of companies that have been forced to reduce their activity, or even close, by the lack of liquidity or credit necessary to continue operations.
SMEs have high expectations when they start to develop export strategies and define foreign market entry models. This might be influenced by different criteria varying from country to country. The economic crisis has had a crucial impact on export strategies.
It seems like just a short time ago we lived in a world in which contact with other cultures was incidental and peripheral. Sure, there used to be immigrants from other countries and then there was of course some contact when we travelled, but for most there was no real need to dive deeper towards understanding other cultures. Moreover, the impact of developing countries and regions at the other side of the globe on our daily life was very minimal, if at all. Well, that’s changing, and there is now a need to accept and embrace globalization, or be destined to failure (or worse, talk of isolationism as a way around it).
This article summarizes a paper on “Applying the Four Gears of National Export Strategy to Achieve Export Competitiveness that I wrote back in May 2012.
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