Trade and Trade Finance in the 2008-09 Financial Crisis

66 Pages Posted: 1 Feb 2011

See all articles by Irena Asmundson

Irena Asmundson

affiliation not provided to SSRN

Thomas William Dorsey

International Monetary Fund (IMF)

Armine Khachatryan

World Bank - Office of the Executive Director

Ioana Niculcea

affiliation not provided to SSRN

Mika Saito

International Monetary Fund (IMF)

Date Written: Janurary 2011

Abstract

Global merchandise trade sharply declined in late 2008 and early 2009, and some press and financial market reports assigned a large role for the decline to trade finance. However, the available evidence suggests that shocks to trade finance were not the major factor in the decline in trade. Surveys of commercial banks by the IMF and others found that while bank-intermediated trade finance fell in value during the crisis, it fell by less than merchandise trade. As a result, the share of world trade supported by bank-intermediated trade finance increased despite higher pricing margins. Other explanations appear to account for the bulk of the reduction in international trade.

Keywords: Bank credit, Banking, Banks, Capital markets, Financial crisis, Global Financial Crisis 2008-2009, International trade

Suggested Citation

Asmundson, Irena and Dorsey, Thomas William and Khachatryan, Armine and Niculcea, Ioana and Saito, Mika, Trade and Trade Finance in the 2008-09 Financial Crisis (Janurary 2011). IMF Working Papers, Vol. , pp. 1-65, 2011. Available at SSRN: https://ssrn.com/abstract=1751426

Irena Asmundson

affiliation not provided to SSRN

No Address Available

Thomas William Dorsey

International Monetary Fund (IMF)

700 19th Street, N.W.
Washington, DC 20431
United States

Armine Khachatryan

World Bank - Office of the Executive Director ( email )

Washington, DC
United States

Ioana Niculcea

affiliation not provided to SSRN ( email )

Mika Saito (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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