Can you comment on the market for mid-cap buyers buying from Asian suppliers in supply chain finance?
I would say certainly that globalisation, although there are some threats to it, is still here and Asian suppliers need much more cash then European or North American suppliers would. These are very small companies and even if they have access to bank finance it is very expensive. So really, in this case, the arbitrage between the interest rates that European or North American companies would pay versus the SMEs in Asia is certainly beneficial to Asian companies. So supply chain finance is certainly, in this case, used at its extreme meaning – really playing on interest rates to facilitate the pre-shipment finance which is so important for these SMEs in Asia.
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