February 25, 2014 (PPI-OT)
Following is the text of press release issued by Karachi Chamber of Commerce and Industry (KCCI)
Rogers LeBaron, International Trade Finance Specialist of World Bank has advised Pakistani business community to benefit from International Finance Corporation (IFC)'s Global Trade Finance Program (GTFP), which guarantees trade related payment obligations of approved financial institutions in emerging markets across all regions of the world.
Highlighting the salient features of GTFP program during his visit to KCCI, Rogers LeBaron informed that through GTFP bank network, local financial institutions can establish working partnerships with a vast number of major international and regional banks in the program, thus broadening access to finance. "Currently, thirteen Pakistani banks are associated with GTFP network", he added.
President KCCI, Abdullah Zaki, Senior Vice President KCCI, Muffasar A. Malik, Vice President KCCI, Muhammad Idrees, Analyst - South Asia Financial and Private Sector Development Unit of World Bank, Sarmad Ahmed Shaikh, Managing Committee members Zafar Saeed Baghpatee, Durre Shahwar Nisar, Asif Jawed, Secretary General KCCI S. M. H. Rizvi and others were also present at the meeting.
WB's Trade Finance Specialist pointed out that by tapping the risk mitigation provided by GTFP, international trade finance providers can enhance their global reach confidently, gain familiarity in new markets and build relations with quality counterparty banks in growth markets around the world. "GTFP facilitates imports and exports to countries like Cambodia, Cameroon, Uganda, Nigeria, Brazil where you might not be thinking about due to concerns about payments", he added.
He said that GTFP extends and complements the capacity of banks to deliver trade finance by providing risk mitigation on a per-transaction basis in challenging markets where trade lines may be limited.
He further stated that IFC covers import letters of credit (LCs) and standby letters of credit (SBLCs), as well as the obligation of the issuer of performance bonds, bid bonds, and advance payment guarantees for unfunded trade transactions.
Elaborating coverage for funded trade transactions, Rogers LeBaron said that IFC covers the obligation of the issuer of a financial instrument for trade financing on-lent to its clients. Instruments such as promissory notes, standby LCs, or credit guarantees in favour of participating Confirming Banks that provide funds to the Issuing Bank can be covered under full or partial guarantees from IFC.
Trade finance credit from Confirming Banks supports LC bill discounting or negotiation, bankers acceptance financing, pre-export or post-shipment financing, and post-import financing on a trade asset portfolio or for individual trade transactions, he added.
Rogers LeBaron also requested KCCI to extend cooperation in organizing a presentation at the chamber's premises in order to highlight the features of IMF cover which is being provided to Pakistani importers and exporters.
Speaking on the occasion, President KCCI, while appreciating IFC's Global Trade Finance Program, said that it will certainly help Pakistani exporters and importers to fearlessly explore new markets.
He also expressed concerns over high Export Finance Rate of the State Bank of Pakistan, which has resulted in raising the cost of doing business and making Pakistani goods and services uncompetitive in the international markets.
Abdullah, while extending full support to International Finance Corporation in raising awareness about the services offered under various programs, said that KCCI is looking forward to further strengthen its relation with IFC.
Sarmad Ahmed Sheikh, Analyst | South Asia Financial and Private Sector Development Unit of World Bank informed that World Bank Financial and Private Sector Development team is engaged in preparing a Trade Finance diagnostic report to help them better understand the scope for improvements in the Trade Finance landscape in Pakistan.
He said that the objective of the trade finance knowledge product is to identify opportunities, to expand access to trade finance for Pakistan's private sector and to finance productive activities for domestic and external markets.
The findings could therefore feed into a dialogue with the Government of Pakistan (GoP) on creating a more competitive private sector by increasing opportunities to better develop export markets and linkages through access to trade finance, he added.
For more information, contact:Aamir HassanDirector Press/ Electronic Media and Public RelationsKarachi Chamber of Commerce and Industry (KCCI)Aiwan-e-Tijarat Road, Off Shahrah-e-Liaquat,Karachi-74000Email: firstname.lastname@example.orgURL: www.kcci.com.pkOffice: +92 99218001-09Fax: +92 21 99218010