What is Trade Finance ?

Switzerland and greater Geneva area, the Global hub for Commodity Trade Finance

The greater Geneva area (including Canton of Vaud) has become a pivotal location for commodities since the middle ages due to its location. We estimate 400 companies to be present in this part of Switzerland. It includes commodities merchants, shipping and logistic companies, insurance, brokers and commercial banks.

How it works

Traders in Switzerland manage the delivery of a wide array ofnatural resources and semi transformed commodities across the globe without their transiting through Switzerland. They raise financing and manage the risks when coordinating shipments.

Purchase of large
quantities of
commodities
throughout
the world
Transformation
of refining
Transport
and Inventories
Delivery of the
commodities to
the final buyer

The main global hub

chart-01

GRAINS TRADING

Leman Region

Europe

The Americas

Singapore

Others

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COFFEE TRADING

Leman Region

New-York

Singapore

Zürich

Hamburg

Others

chart-03

SUGAR TRADING

Leman Region

Paris

London

The Americas

chart-04

PETROLEUM TRADING

Leman Region

Singapore

New-York & Houston

London

Others

History

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1956

Incorporation in Geneva of Tradax, a subsidiary of Cargill, the world’s leading trader of agricultural products and of Phillip Brothers in Zug

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1962

Mass exodus of a large number of Egyptian cotton traders (after nationalisation of the Suez canal by Nasser) seeking a safe haven in the region of Lake Leman where they continued conducting business.

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1972

Incorporation of large oil traders. Making Geneva one of the biggest hub for commodity trading. 1/3 of oil volume worldwide.

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1978

Paribas, first bank starting commodity trade finance based on collateral of goods. Including March Rich and other large commodity traders.

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2006

Incorporation of STSA, Geneva staffed by ex bankers and trade finance professionals to provide a voice in Bern for the Trade Finance and shipping world. Exponential increase of members over the following years.

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2016

Due to new regulations, Trade Finance banks start to increase minimum level of equity for SME’s.

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2018

Trade Finance banks are focusing on major commodity traders. Smaller ones are left and are looking for alternative financing , such as Horizon Capital.

A major sector in Geneva…

200
number of companies active in the domain of Trade Finance in the canton of Geneva.
3000
number of direct jobs linked to Trade Finance
1 %
contribution to the Canton’s tax revenues by Trade Finance companies
5 %
the portion of Geneva’s GDP linked to Trade Finance

…and in Switzerland

From 2 to 25
number in CHF Bios of gross tax revenue linked to Trade Finance between 2002 and 2017
3. 0 %
the portion of Swiss GDP linked to Trade Finance
100
the number of container ships in Swiss hands

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