The Asian Development Bank’s (ADB) Trade Finance Program (TFP) has signed guarantee and loan agreements with the National Bank of Samoa and Samoa Commercial Bank.
The agreements will see the TFP provide up to $12 million annually to support trade activity in Samoa.
“It’s the first agreement of its type and I’m congratulating Samoa for taking the lead with this project and facilitating the development and the finalization of the agreement,” said Minister of Finance Sili Epa.
“This will definitely help with the trade investments we’re going through especially with pushing exports for Samoa. And for these two banks involved, it’s a sign that we are at the standard it needs to be in order to reach out for better overseas trades,” he added.
“This agreement will expose what we have to offer through better connections not only through the funding but with this partnership we will break another milestone in our reach for better markets overseas,” Minister Epa added.
Currently Samoan importers are risking paying for goods upfront and this can mean strained cash and the risk of no products coming in at all.
The Trade Finance Programme will help resolve that issue, said ADB Relationships Manager for the TFP, Edward Faber.
“With the TFP, ADB will work with these local banks to help increase the use of financial products such as letters of credit, which will enable importers to pay safely,” he added.
Samoa is the first country to be included in the programme.
Mr Faber said the plan is to take the TFP to other Pacific island countries.