TradeFinex - The Future of Funding Infrastructure, Creating Jobs and boosting Economic DevelopmentJuly 12, 2018
Job creation is the fuel for economic growth in both advanced and emerging economies. Because of this, I am a massive fan of technology that creates and leverages opportunities that result in immediate and sustainable job creation, as well as economic development.
The two sectors that create the largest significant employment and sustainable economic impact are:
· Critical infrastructure projects
· Nano, Micro, Small and Medium Enterprises (NMSME)
These sectors require financing of all magnitudes in order to thrive. Access to appropriate funding is the major challenge experienced for both these sectors.
“It is forecast that $94 Trillion needs to be invested in global infrastructure projects by 2040”
TradeFinex provides a solution for these financing needs. By using a hybrid blockchain, TradeFinex is creating a global trade and financing marketplace that enables both Infrastructure Projects and NMSME’s to:
- Globally crowdsource investments — with more competitive rates than what may be available locally
- Reduce cost of financing by using fewer intermediaries
- Increases automation and auditability with Hybrid Blockchain smart contracts
- Increase speed transactions — with practically zero remittance fees
TradeFinex global trade and finance marketplace services three interconnected participants: Beneficiaries; Suppliers and Investors.
Let’s look at these three participants in more detail.
There are two major beneficiaries in TradeFinex marketplace, and they are also the largest drivers of employment and sustainable economic growth:
The role of infrastructure is to provide essential services with long lifespans to communities and industry. Critical infrastructure projects include water, health, education, transportation networks, energy, wastewater-treatment plants to name a few. Infrastructure projects are central to sustainable and growing economic development and also provide immediate and significant employment.
Infrastructure projects, by their nature, involve significant long-term investment — ranging from multi-million-dollar solar power plants, to billion-dollar budgets for airports, roads and other major projects.
Governments are the largest beneficiary that seek investment of infrastructure projects.
Chris Heathcote forecasts that global infrastructure investment will require $94 trillion by 2040 — which can be found in his article published by The World Bank “Forecasting infrastructure investment needs for 50 countries, 7 sectors through to 2040”.
One of the greatest challenges in solving this need for global infrastructure investment is access to global finance on acceptable terms and with transparency.
Nano, Micro, Small and Medium Enterprises (NMSME)
NMSME represents the largest employers and contributors to job creation in every economy in the world.
Access to funding for NMSME’s continues to be complex, expensive and difficult. The quantum of obstacles to funding increase significantly when enterprises are located outside of the developed world and highly urbanised cities.
TradeFinex provides NMSME with a global marketplace to increase access to funding with transparency and for all parties.
Suppliers are the companies that provide the products and services to the beneficiaries.
In some instances, the supplier may also be sourcing investment directly, or in collaboration with beneficiary. It many countries it is common practice for suppliers to seek co-financing for the development and management of infrastructure projects.
Global infrastructure and NMSME investment opportunities are sought from Governments, Sovereign Funds, Private Equity, Venture Capital, Financial Institutions, etc. They wish to have access to a broader range of global investment opportunities with more transparency, less intermediaries, and lower investment/transaction-related costs.