11
Oct 17
Banking

An inflection point for globalisation: Top takeaways for trade

How recent events impact trade and the supply chain

By Michael Quinn, Global Trade & Loan Products, Corporate & Investment Bank, J.P. Morgan

Key considerations amidst growing Eastern hemisphere dominance, the retreat of traditional trading powers and the politicization of trade:

1.    Trade decisions are becoming more political. They are no longer taken on the basis of the numbers alone.

2.    Sanctions have become a common response to several geopolitical challenges. In a changing global trade marketplace, there exist various opportunities to violate these restrictions while doing business, and corporates need to locate sanctions tripwires before making decisions.

3.    The currents of trade are now starting to push back against some countries that will be less favorably viewed in a trade deal.

4.    Time is a challenge, since as long as there is uncertainty around markets, decisions cannot be taken. 

5.    The traditional focal point of global trade has accelerated its shift eastward, and corporates will increasingly find themselves operating in new markets and new economies.

6.    The new environment is going to create demand for creative solutions from banks in order to support their clients, from capital markets funding to direct bank lending or even exporter education opportunities. 

7.    While populism and nationalism in some quarters will see a move toward protectionism, new leaders of global trade are emerging.

8.    Banks and corporates which are able to adapt to the shifting sands of geopolitics will be best equipped to take advantage of the new opportunities springing up amid worldwide changes. 

These points will be discussed in greater depth at “Building a new industry blueprint in trade and supply chain” on 19 October at the MTCC. 

 

Michael Quinn