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Special Report: CEE/CIS Trade Finance
March 31, 2017 www.intellinews.com I Page 21
Grappling with the “new normal” of sanctions and compliance
bne IntelliNews
It’s been a rough few years for global trade fi- nance, with often sharply reduced activity amid sluggish or negative economic growth in a heavily sanctions- and compliance-burdened
landscape. This has forced many national, region- al and global banks with trade finance functions to pedal twice as hard just to keep momentum.
Yet innovative players have still found opportuni- ties between a rock and a hard place, developing new tailored solutions and products to meet the needs of clients, especially for small and medi- um-sized enterprises (SMEs), which have been disproportionately denied the means to expand their trade as the big fish hoovered up available finance.
In Central and Eastern Europe, operators are again looking for chinks of light after the bleak
period that ensued with Russia’s 2014 annexation of Crimea and the subsequent imposition of puni- tive EU and US sanctions. This, coupled with low commodity prices and currency devaluation, ham- mered Russia’s economy for the next two years, with far-reaching spillover effects. “The region as a whole still suffers from the economic downturn in Russia, which affects neighbour countries and has led to a decline of all volumes of trade fi- nance,” Holger Kautzky, Head of Financial Institu- tions at Commerzbank who is responsible for the region, told bne IntelliNews last October.
Roll the clock forward six months and how the kaleidoscope has turned, with the shock election of Donald Trump as US president, and Russia’s financial health gradually stabilising after the Opec production cut deal buoyed oil prices. While this doesn’t translate to a sudden boom in trade