Joint Statement by Heads of Multilateral Development Banks and the WTO on Boosting Supply Chain Trade in Emerging Markets

Supply Chain Finance (SCF) is essential for enabling emerging markets firms, particularly Small and Medium sized Enterprises (SMEs), to participate in both global and local markets. Greater participation of SME firms in global value chains will increase trade and development opportunities, integrate value chains, and incentivize better Environment and Social (E&S) performance.

However, according to the recent studies conducted by International Finance Corporation (IFC) and the World Trade Organization (WTO), local availability of SCF, especially in low income and fragile countries, is scarcer than traditional trade finance due to weaker financial and legal infrastructures, leading to missed economic opportunities. 

Multilateral Development Banks (MDBs) need to collaborate to further increase financial support, improve regulatory frameworks, promote marketplaces, drive E&S agenda, build market capacity, and increase product availability in supply chain finance markets.

We, the World Trade Organization (WTO), International Finance Corporation (IFC, World Bank Group), African Export-Import Bank (AFREXIMBANK), Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD), IDB Invest (Inter-American Development Bank Group), and Islamic Trade Finance Corporation (ITFC, Islamic Development Bank Group), will coordinate through the already established Supply Chain Finance Task Force under WTO’s Multilateral Development Banks (MDBs) Working Group to i) increase financial support through their existing SCF programs; ii) strengthen the legal infrastructure; iii) promote common sector-level operating marketplaces; iv) build market awareness and stakeholder capacity; and v) work with financial institutions to increase product diversity and availability. 

We also call on financial institutions to support SCF markets growth in emerging markets.