Global Network on Eximbanks and Development Finance Institutions (G-NEXID)
27 March 2014
Excellencies,
Distinguished Colleagues,
Friends,
I am glad to address representatives of a sector critical to international trade.
As you know, tackling difficulties to accessing trade finance in the fragile markets of the South, was the key rationale for the creation of G-NEXID. Improved access to trade finance stimulates South-South trade, and overcomes the lack of knowledge about foreign enterprises that can hold back much-needed financing for trading activities. G-NEXID overcomes these obstacles by providing a valuable platform for the exchange and sharing of know-how among the Export-Import Banks and Development Finance Institutions of the South.
We at UNCTAD believe the need for cooperation among trade and development financing institutions has never been more pertinent to the health of the global economy than it is today. The need for this cooperation particularly among Southern partners, has been further enhanced by the negative impact of alternative products over the recent crisis.
Last November's Annual Forum of the Association of African Development Finance Institutions held in Mombasa, Kenya, emphasized the need for DFIs to work together sharing lessons and promoting business development across the continent.
The 2013 BRICS Summit in Durban, South Africa also signed two financing agreements to facilitate multilateral cooperation on infrastructure finance, and on financing sustainable development initiatives.
The members of APEC, the Asia-Pacific Economic Cooperation forum, have also been active in furthering cooperation among Eximbanks and DFIs from member countries.
This heightened need for cooperation on trade financing became particularly evident with the onset of the global financial and economic crisis. The Asian Development Bank has calculated that the gap in trade finance represented by unmet demand for lending and guarantees during the crisis could have supported approximately $1.6 trillion in trade.
Eximbanks, Development Finance Institutions, Multilateral Development Banks and Export Credit Agencies can and should respond to this gap. The key to making this happen is improved trust and better information sharing about deals and opportunities, which your institutions encounter every day.
G-NEXID aims to catalyse the exchange of this type of information, expertise and experience between Eximbanks and Development Finance Institutions. Indeed I am pleased to note the continued and growing success of collaboration between members of G-NEXID.
Let me highlight a few as examples:
First, you may know that the Nigerian Export Import Bank, or NEXIM, received a credit line of 20 million US dollars from the ECOWAS Bank for Investment and Development (EBID). This will deepen export and import trade financing across Africa. This loan facility will enable NEXIM to facilitate export and import trade within the ECOWAS sub-region both over the short- and medium- term. NEXIM has also launched the ECOWAS Trade Support Facility to provide short term finance to exporters in support of trading activities in West Africa.
Another important partnership is the collaboration between Eximbank of INDIA and NEXIM of Nigeria to promote the Bollywood and Nollywood film industries. NEXIM's Nigerian Creative and Entertainment Industry Stimulation Loan Scheme is intended to address issues regarding the institution of credible structures, to attract investment in the development of content and infrastructure in the media and entertainment sector, as well as to improve production standards, distribution, marketing and exhibition standards.
In Latin America, as part of its strategy to support the Latin American banking sector, the Development Bank of Latin America, or CAF, approved last year an additional 50 million US dollar credit line increase for BLADEX, the Foreign Trade Bank of Latin America.
Further South-South cooperation facilitated by G-NEXID includes the agreement between CAF and Afreximbank in March 2012 to collaborate in identifying, preparing and appraising projects in Latin America and Africa. This joint work will include exchange of information and knowledge, mutual assistance in operational areas, consulting for best practices in client service, in addition to cooperation on training and organization of business events.
These are only a few examples of what is possible through the G-NEXID forum. I know that your continued interactions and exchanges will build even closer working relationships among yourselves, which will ultimately help deliver the benefits of development-centred globalization to your respective countries and regions and to the entrepreneurs and firms, whom you serve.
UNCTAD is proud to have jointly with Exim Bank India convened the first G-NEXID in 2006, and we remain steadfast in our collaboration with the Network. The G-NEXID forum sustains itself precisely because it gives its members what they can't get anywhere else -- it is a genuine platform for informal, frank dialogue between Exim Banks and Development Finance Institutions that builds trust and secures relationships, which make South-South trade finance work.
As you may know, this year UNCTAD celebrates its fiftieth anniversary. We are looking back on our colourful past, but also forward to the future. Since our founding in 1964, UNCTAD has served as platform for the South to promote its collective economic interest. In many ways, G-NEXID exemplifies what UNCTAD can help accomplish to this end. I sincerely hope that together we can catalyse further trading opportunities that harness the new geography of the South-South trade map and that help achieve prosperity for all.
I look forward to our continued collaboration towards these objectives and I wish you a successful meeting.
Thank you!
