TRADE FINANCE
PRIVATE SECTOR
Trade is center stage for the 2030 Agenda The 2030 Agenda for Sustainable Development recognizes international trade as an engine for inclusive economic growth and poverty reduction and a vital means of achieving the Sustainable Development Goals (SDGs). The OPEC Fund aligns its trade finance operations with strategic priorities that support the SDGs, contributing to goals such as SDG 1 – No Poverty, SDG 2 – Zero Hunger, SDG 3 – Good Health and Well-being, SDG 8 – Decent Work and Economic Growth, and others. “We are employing a multi-faceted approach to address these challenges in the global context and to align our trade finance operations with the SDGs on di ff erent dimensions,” says Khadduri. The approach includes working with governments on improving policy frameworks. For example, in 2022, the OPEC Fund provided a US$100 million loan to promote financial sector inclusion in Morocco. Under the Financial and Digital Inclusion Program, co-financed with the World Bank, the Moroccan government is providing households and firms with a ff ordable, responsible and sustainable financial services to create an enabling business environment while also enlisting the private sector in support of economic and social inclusion. The main objective is to improve access to digital services for individuals and MSMEs, including start-ups. How does this relate to trade? Digital platforms and financial technology can streamline trade processes,
ETC Group Country: Africa & Global Type: Trade & Corporate First transaction: 2009
Since its establishment in Kenya in 1967, ETC Group has developed into one of the largest independent agricultural commodity supply chain managers in Africa. It owns more than 300 warehouses and operates over 70 processing plants. Several OPEC Fund loans, with the first US$30 million facility provided in 2009, have helped ETC expand its infrastructure and processing capacity. More than 350,000 smallholder farmers have
benefitted and over half the funds have gone to Least
OPEC Fund total commitment: US$65 million Implementation Status: Completed
Developed Countries.
Photo: ETC Group
The ETC Group and OPEC Fund partnership boosts Africa’s global agricultural presence by enhancing exports, improving market access, promoting sustainable farming, thereby putting Africa as a global player in the international agricultural space.
The OPEC Fund’s work to date has provided support to more than 800,000 SMEs globally
Olumuyiwa Osibanjo, Senior Investment Manager, Private Sector, OPEC Fund
reduce paperwork and enhance traceability in
supply chains. The use of electronic bills and smart contracts can expedite transactions and reduce the risk of fraud. Another dimension is supporting SMEs through local financial institutions or directly working with corporates. The OPEC Fund’s work to date has provided support to more than 800,000 SMEs around the globe. In most successful economies, these companies are the engines of growth, innovation and jobs. New products such as sustainability
linked loans (SLLs), tied to trade, are also
reduce their carbon footprints, enhance resource e ffi ciency and promote sustainable practices across their operations and supply chains. Implementing such products in a way which will help to decrease the environmental impact of trade can have a multiplying development impact. Similarly, the OPEC Fund has recently approved its first SSL, which will contribute to enhancing the food value chain in sub-Saharan Africa.
under preparation by the OPEC Fund. SLLs are an innovative financial product
designed to incentivize businesses to achieve environmental, social and governance (ESG) targets. Unlike traditional loans, SLLs tie the loan terms to the borrower’s performance against predefined sustainability objectives. This structure encourages companies to
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