Institutions of Economic Finance

Published on 12 December 2022 at 04:37

Global trade hinges on international finance to provide firms with connections and capital to develop products and services. Financial institutions play a crucial role enabling international commerce by giving businesses access to credit, investment, and
other financial services. In addition, financial institutions offer companies vital resources they require to succeed, whether they are major multinational organizations or small and medium-sized enterprises (SMEs).

By the end of 2022, the world economy is anticipated to be significantly impacted by China's weakening economy. International growth is anticipated to slow from 3.2% by the end of 2022 to 2.9 in 2023. This is mainly due to the dip in Chinese economic growth in 2022 resulting from prolonged lockdowns, tighter global financial conditions brought on by an anticipation of rising interest rates to reduce inflation pressure, and more broadly, fallout from the conflict in Ukraine. (IMF)

Global transaction digitization is expanding because of expanding digital platforms and networks. Faster transactions, better accessibility to liquidity, and cutting- edge digital services like digital payments, cryptocurrencies, and e-contracts are all made
possible by this innovation. Digitized financial infrastructure makes it faster and easier to perform international financial transactions, yielding increasingly rapid and effective global commerce.

SMEs frequently require aid to procure funding on reasonable terms. In many nations, SMEs are the main drivers of economic growth, private and public sectors are expanding investments in business development projects, specialized financing, insurance
plans, and digitization to enhance access to funding for small enterprises to solve this difficulty.

For instance, in April the Canadian government announced the launch of the Business Development Bank of Canada's digital lending platform. This platform will provide quick and straightforward access to inexpensive funding for SMEs. The system
will provide access to loans worth up to $6 billion, simplify the loan application procedure, and offer more affordable interest rates (IFI). This will greatly aid Canadian SMEs to thrive in the international market.
 

Sources
https://www.tradecommissioner.gc.ca/development-developpement/mdb-overview-bmd-
apercu.aspx?lang=eng 

https://www.tradecommissioner.gc.ca/development-developpement/mdb-overview-bmd-
apercu.aspx?lang=eng

https://ised-isde.canada.ca/site/sme-research-statistics/en/venture-capital-catalyst-
initiative/designing-renewed-venture-capital-catalyst-initiative-what-we-heard

https://www.imf.org/en/Publications/WEO/Issues/2022/07/26/world-economic-outlook-
update-july-2022

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