A Study of Guatemala, Honduras, and Mexico
Trade finance is supplied by banks to bridge the lag between when an exporter seeks payment for the goods they ship and when an importer can pay, which may not be until they sell the goods to their customers. These financial facilities are vital to the workings of international commerce. Therefore, making them more widely available and cheaper is likely to accelerate growth and development.
New research by the International Finance Corporation (IFC) and World Trade Organization (WTO) finds that better and more affordable access to trade finance would boost trade in goods as much as 9 percent in Guatemala, Honduras, and Mexico. This rise would amount to an increase of about $90 billion in cross-border goods trade in the countries studied. The report outlines coordinated actions that trading firms, banks, policymakers, and international organizations can take to foster more trade and supply chain finance.
These findings come from the third in a series of regional trade finance surveys. The latest research focuses on three upper-middle income countries, whereas the previous two studies—on West Africa and the Mekong—looked at low-income regions.
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