Even as economists see signs that the global recession may be easing, a lack of financing for South Florida exporters and importers is holding back growth in international trade.
Big changes occurred in trade financing in the wake of last year’s economic and financial crisis — and importers, exporters, their customers and suppliers have all been hurt by the recession.
The Florida International Bankers Association, a trade group representing more than 70 domestic and foreign banks, estimates that about 80 percent of international trade was financed via open accounts in past years. Under an open account, goods are shipped to a customer and payment is usually due in 30 to 90 days.
“The trade finance business dried up because of increasing levels of risk and because of the economic crisis, so exporters are taking on the burden themselves,” said Jerry Haar, associate dean for international affairs and projects at Florida International University. “Things got tight for exporters.”
Read: “Credit crunch hurts small, mid-size trade firms“, an article from the MiamiHerald.com.