Asia Trade: The heart of world trade responds to change

and working capital management actions will differentiate the Winners from the Laggards. We are also seeing pockets of high growth industries like Technology, Telecommunication and Renewables that continue at a strong pace in the region. 3. As you mentioned, ESG has become an increasingly important focus. How much progress is being made in implementing green initiatives? How is Citi helping? Kanika: On the “E” side, we are seeing a lot of activity from clients in sectors where there is strong manufacturing, procurement and raw material input. What’s more, renewable energy projects are increasing in number — particularly when looking at export credit agency- (ECA) backed transactions, which typically have a 10–15-year tenor. Megha: Given where most Asian populations are with regards to development, there is naturally more of a focus on the “S”. In India, for instance, we have seen a lot of multilateral engagements and export agency financing for areas of society that may be struggling or that promote women in business, all of which have had a significant impact. Governance, on the other hand, has always been slower in the Asian market. But there are a lot of corporations that are making a concerted effort to demonstrate good board practices and regulatory compliance. For Citi, having committed nearly US$1 trillion to sustainable finance, and targeting net-zero by 2050, promoting growth in this area is of utmost importance — particularly in the Asian market. Working with partners such as EcoVadis, our sustainable supply chain finance (SSCF) offering, helps clients to finance socially and environmentally responsible trade, incentivise good citizenship throughout their supply chains. The first of our SSCF program was implemented in 2021 for German chemical and consumer goods company, Henkel, incorporating existing and new suppliers in Asia Pacific that demonstrate a strong or improving sustainability performance. Following the successful rollout of our SSCF solutions, we launched our Sustainable Trade and Working Capital Loans solution in 2022. This helps institutional clients to finance social and environmental initiatives, with incentivised pricing against sustainability criteria. We believe that this is just the beginning and ESG will drive the next phase of structural investments in Asia. We want to actively participate in building a sustainable future alongside our clients. 6. Citi has restructured its Trade Finance business in the past year. How does this address the needs of Asian clients? Megha: We have made it a priority to remain close to our clients in the region and embed ourselves in their core trade flows. This means we have invested heavily in technology, our product portfolio — both in terms of supply chain and sales financing — and most importantly in our teams. Ensuring our team is composed of a highly talented, diverse mix of backgrounds and experience is paramount to being at the cutting-edge of market innovation and being attuned with the varied, specialised needs of our clients throughout Asia. Over the past year, this strategy has yielded positive results. Our supply chain finance programs peaked to maximum utilisations last year and we were able to increase our sales financing portfolio by 40%. “The first of our SSCF program was implemented in 2021 for German chemical and consumer goods company, Henkel, incorporating existing and new suppliers in Asia Pacific that demonstrate a strong or improving sustainability performance.”