Doha's fast reach to as many as 17 Near East Belt Initiative (NEBI) markets with more than $2tn trade flows and its strong commercial ties with world trading centres help to grow its soft power as an alternative trade finance hub, according to a top official of Nebix, an artificial intelligence (AI)-powered global platform for trade finance assets.
The trade finance hub would greatly benefit the small and medium enterprises (SMEs), especially in Qatar, for their funding needs for trade related activities, said Fadi Saab, chairman of the Qatar Financial Centre (QFC)-based Nebix, which aims to place Doha as its hub, powered by its innovative AI tools with multi-currency and multi-jurisdictional assets.
“This platform, being offered for the first time in the region, will focus on NEBI corridor, which extends from Turkey with all the Eurasian countries, India to South East Asia, and has as many as 17 countries with a population of 400mn people and several SMEs. We are telling these people to use Doha as a hub to help finance trade requirements (of SMEs),” he said.
"There is opportunity for Qatar to grow its soft power with NEBI markets by positioning itself as an alternative trade finance hub," he said, adding the corridor markets in the NEBI share a common core characteristic as they are all fast-growing emerging markets in Qatar’s nearby geographic vicinity.
Qatar’s geographical position provides an efficient gateway for multinationals corporations, prominent companies, and major financial institutions that serve NEBI corridor markets (Turkey, Iraq, Kuwait, Oman, Pakistan, India, Azerbaijan and Central Asia), he said.
A latest report from the QFC said the key advantage of operating a trade finance platform out of Qatar is to leverage operational Qatari transportation and logistics assets with ready access to trade finance.
“Launching a trade finance platform out of Qatar offers participants the ability to build on accumulated knowledge and connect directly into a wide international network,” the QFC report said.
On the global scale, Saab said Qatar has successfully established valuable commercial ties with several major trading centres around the world enabling it to optimally conduct business with all mercantile partners.
At the regional level, Doha is mobilising its advanced resources to geographically expand trade activities by connecting lucrative markets serving the neighbouring NEBI population of more than 400mn people.
Locally, Qatar continues to innovatively dedicate its world-class infrastructure, state-of-the-art facilities, modern transportation fleet, and hi-tech logistics to competitively support a growing trading network, according to him.
"Qatar’s stable political regime, positive economic development, ease of doing business, tax-friendly regulations, and dynamic commercial environment, offer lucrative opportunities to cement its position as the attractive regional trade finance hub of choice," Saab said.
Qatar’s productive business ecosystem can be leveraged to assist many countries in the NEBI markets to overcome negative economic challenges from commercial risks due to barriers to operational growth or commercial scaling, obstacles facing access to finance, hurdles from foreign exchange fluctuations or currency exposures, as well as other trading difficulties, he said.
On Nebix, Saab said, the platform helps corporates to increase their global sales, optimise their working capital and minimise risk by validating their trade finance requirements and matching them with the most appropriate funders and credit insurers to support their end-to-end financing needs.
"Our data-driven platform uses the latest technology, including the advanced algorithms and our AI robo adviser, to help users submit relevant information, validate data inputs and optimise financing requests, thereby delivering maximum value to all stakeholders," he said.
Nebix would initially cover three main dimensions of the NEBI market such as Qatar trade flows, NEBI imports and NEBI exports.
"We take a conservative approach and aims to target around 0.2% market share by end of fifth year with $4bn worth of trade finance transactions captured on the marketplace platform," he said.
The Nebix platform would not only help SMEs looking to shorten their credit terms and reduce the pressure on their working capital but also help free up cash trapped in their balance sheets, thereby preserving the borrowing capacity for the future.
Implementing Fineon Exchange’s efficient and non-disruptive model with tried and tested processes would enable Nebix to become the go-to trade finance partner and solution provider for the region’s corporates, funders, and ecosystem parties.
“We have already witnessed interest from European trade finance platform players such as Fineon, which seek to tap into the large existing trade flows between the Middle East and Central Asia,” the QFC said.