1. Jacques-Olivier Thomann
Honorary President
Geneva Trading and Shipping Association (GTSA)

2. Role of Switzerland as a hub for commodity trading and finance What Switzerland can bring to Arab financial institutions and commodity houses ? Trends and Developments
Jacques-Olivier Thomann
Board member Geneva Financial Center
Honorary President GTSA
Geneva April, 3rd 2014

4. Role of Switzerland as a hub for commodity trading and finance
A unique positioning with a true cluster effect
No other international centre can match Switzerland for the strong positions it holds across all key areas of the commodities sector
Commodity trading companies
Trade finance Banks
Ship chartering
Legal
Inspection and certification
Commodity sectorial Associations
10,000 jobs relating to the sector
Over 400 companies
3,5% + of GDP

5. Geneva Trading and Shipping Association
Founded in 2006, GTSA regroup the commodity sector players: Trade Finance Banks, commodity traders, shipping companies, brokers, security and inspection companies
Zug Commodity Association
Lugano Commodity Trading Association
and soon a SWISS COMMODITY TRADING FEDERATION

6. The Lake Geneva Region, the centre for commodity trading
Key dates
Players in the sector
Trading companies
Several hundred billion in combined revenue
Approx. 400 companies including Cargill, Mercuria, Vitol, Trafigura, Louis Dreyfus, Totsa,Bunge, Addax, Gunvor, Metinvest, Sucafina …
Banks
Aprox. 15 including BNPP, Crédit Agricole, ING, Société Générale, Credit Suisse, UBS, the cantonal banks, Arab Bank, National Bank of Abu Dhabi,BCP…
Shipping companies
Over 1,200 million tonnes of commodities shipped
MSC, Geogas, Promar, Riverlake...
Certification and inspection companies
SGS, Cotecna….
Service companies
Lawyers, insurance brokers, auditors...
Association : Geneva Trading and Shipping Association, GTSA
University : Master, Diploma, ++
First World War
Second World War
First oil crisis
Collapse of Soviet Union
1950
1973
1990
2000
2010
International organisations
Egyptian cotton producers
End of the oil majors’ monopoly
CIS trading companies
International traders
Positioning
Oil:
Number 1 : 35% of world oil traded
75% of ex-USSR exports
Steel
Traders: 10% of global exports
Banks: 60% of exports
Soft commodities
Number 1: cereals and vegetable oils 35%, coffee 50%, sugar 50%, cotton, cocoa
60% of Russian and Ukrainian exports
Positive momentum
Following the financial crisis
Very pragmatic financings
Secured financing of real and physical goods
The commodities sector is part of the real economy
Ensures logistics for and movements of commodities
Ensures that markets are well supplied with strategic products
Contributes to the development of the emerging markets
Inspection and Certification : Worldwide leader

7. What Switzerland can bring to Arab financial institutions and commodity houses ? Trends and Developments
With an extremely restrictive regulatory framework : Basel III……..
Liquidity ratio: liquidity coverage ratio (LCR)
Funding ratio: net stable funding ratio (NSFR)
Capital ratio: leverage ratio (LR)  from 4% to 7%, 9% and above
…..and political uncertainties in a debt crisis environment
Fall in USD money market funds cheap liquidity
"Nationalist" pressures
 European banks must take exceptional measures
Deleveraging their balance sheets and improve their ratios
Downsizing their USD funding requirement
Looking for alternative sources of funding

8. Trade finance funds CLO’s Securitisations
This situation creates a particularly favourable environment for investors,
innovative banks and trading companies, indeed
Commodity Trade financing structures will be moving to non-banking type of facilities such as
Trade finance funds
CLO’s
Securitisations
These investment models are uncorrelated to traditional asset classes,
generating good return to investors
with a wide range of risk profile

9. Thank you for your attention
Jacques-Olivier Thomann