Taping on Singapore Structured Commodity Trade Financing to grow – Trading is a very big part of the Singapore economy. Singapore is positioned well in the part of the world where east meets west and there is close to 25% of the world’s trade going by the Meleka Straits that Singapore sits at the tips of.
Singapore has taken advantage of this position and has made trade one its main engines of growth.
Singapore is also very dependent on its financial markets to grow its economy. Trade financing through the banks and also other forms of financial institutions is one of the key for businesses in the trade financing business to keep going and grow.
The commodity trade business in Singapore is a decent one, taking up close to 4.5% of the country’s GDP. Singapore is likely to want to grow this pie to something bigger.
With this in place, the financing options available for this trade is quite wide in Singapore, reason being that the income to be made from financing such trades can be quite a good and lucrative figure.
Most banks that have a strong base in Commodity Trade Financing will find themselves coming to Singapore to set up a branch to finance the businesses that are based in Singapore and doing its trading around the world or around the region.
Singapore has also very strong regulatory systems in place and a strong rule of law allows it to be run in a very clean and proper manner. This in turns reduces the risk for the banks and financiers that will be putting their money up for the trading purposes. We all know such trades have very low margins and thus when you get to gear up with the funds you have in place, you look to gain a strong position to make money through money you have lent from others.
Taping onto the Singapore Structured Commodity Trade Financing market is definitely one of the key ways such companies can use it to grow and also to extend out their reach into more markets that are in the commodity space.
We work with Avant Consulting Pte Ltd, one of the leading advisorys and consultants based in Singapore providing advice on SME Loans and also Singapore Commodity Trade Financing. The consultants they work with are able to provide not just access to more trade lines but also at the same time better advice on commodity trading.