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Euromoney, January 25 2021

Fourth-quarter numbers from Asia’s biggest trade finance banks suggest that business in the region has bounced back rapidly. Corporates have changed their approach to their manufacturing bases and supply chains, and have accelerated their use of technology. In the first of a two-part series, Euromoney finds there are lessons here for the rest of the world when the pandemic eventually eases.

It is now roughly a year since most of us first heard of Covid-19. One year on, Asia is taking stock of the impact on cross-border trade, while the region’s bankers and corporates are digesting what they have learned along the way.

There are several lessons that are useful around the world: that resilience is just as important as efficiency; and that scraping every last dollar of savings is not as important as making sure you can continue to operate under stress. Turning digital is not only useful but vital, and a thorough supply-chain financing programme is essential if you want your suppliers to survive a shock like this intact.

One of the most surprising lessons, however, is how remarkably quickly Asia trade has bounced back. Industry data suggests that Asia bottomed in the second and third quarters of 2020, before reviving at a striking pace.

HSBC’s trade finance business in Asia has just processed its fourth-quarter numbers when Euromoney speaks to Ajay Sharma, regional head of global trade and receivables finance.

“Our fourth quarter was the best in the last eight quarters,” he says. “We have continued to see a bounce back of trade activity. It is really positive.”

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Chris Wright
Chris Wright
Chris is a journalist specialising in business and financial journalism across Asia, Australia and the Middle East. He is Asia editor for Euromoney magazine and has written for publications including the Financial Times, Institutional Investor, Forbes, Asiamoney, the Australian Financial Review, Discovery Channel Magazine, Qantas: The Australian Way and BRW. He is the author of No More Worlds to Conquer, published by HarperCollins.

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