The $2.5 Trillion Trade Finance Gap Holding Back Global Supply Chains
Global supply chains are moving again, but not always smoothly. After years of disruption, companies are diversifying markets, reshoring or nearshoring parts of production, and building new trade routes that reduce overdependence on single regions. That reshuffle should be good news for manufacturers, logistics providers, port operators, and the infrastructure ecosystem that underpins them. Yet there’s a stubborn constraint sitting underneath all that momentum: trade finance.
According to the Asian Development Bank’s latest Global Trade Finance Gap Survey, the global trade finance gap held steady at an estimated $2.5 trillion in 2025. That figure is unchanged from 2023, and it remains one of the most consequential bottlenecks in the global economy. It’s not just an abstract number for bankers and economists. Trade finance is the lubrication that keeps cross-border commerce working, supporting the purchase of materials, components, equipment, fuel, and the services that keep cargo moving. When the finance isn’t available, firms don’t ship, projects slow down, and contractors face delays that ripple through infrastructure programmes.
Put plainly, the trade finance gap is a constraint on growth at the exact moment the world is trying to reconfigure supply chains for resilience. For the construction and infrastructure sector, it’s also a direct hit to the availability and affordability of critical imports, from steel and cement additives to specialist electronics, renewable energy components, heavy equipment parts, and fleet technologies.
Why Trade Finance Matters to Infrastructure and Construction
Trade finance doesn’t often make headlines outside financial circles, but it plays a quietly decisive role across the built environment. Large infrastructure projects rely on complex procurement chains that stretch across borders, often mixing local supply with imported materials and equipment. Those imports don’t happen on goodwill alone. They depend on mechanisms such as letters of credit, guarantees, and short-term loans that reduce payment risk between buyers and sellers, particularly when they’re operating in different legal, currency, and political environments.
In that sense, trade finance is a practical enabler of construction delivery. When contractors can’t access finance to purchase equipment or secure imported materials on time, work programmes can be disrupted, and the cost of delay becomes painfully real. In projects with fixed delivery windows, even a short interruption can trigger expensive rescheduling of labour, plant and specialist subcontractors.
ADB positions its survey as the only global benchmark of unmet demand for trade finance, and it is widely treated as a key barometer of trade finance health. The 9th iteration of the survey analysed data and opinions collected from 2023 to 2025, drawing input from more than 110 trade finance providers representing up to a third of the global market.
The survey also points to broader structural consequences. Without reliable trade finance, firms can’t fully pursue growth opportunities, and supply chain risk becomes harder to manage. That affects not only private-sector contractors and suppliers, but also public authorities attempting to deliver roads, rail upgrades, energy networks, and major resilience projects at scale.
A Persistent Global Gap and a Slightly Improved Ratio
The ADB estimates the global trade finance gap remained at $2.5 trillion in 2025. While unchanged in absolute terms from 2023, the gap is now estimated at around 10% of global trade, down from 10.6%. That’s modest progress, though the headline message is hard to ignore: the gap is still huge, and it’s still holding back firms that might otherwise expand.
One of the core implications is that demand is not only remaining high but may be rising further. The survey found that 80% of banks polled expect global demand for trade finance to increase as companies diversify markets, deepen intra-regional trade, and reconfigure supply chains. In the real world, that expectation reflects what industry has been living through: firms are actively managing risk by building redundancy into supply routes, sourcing from multiple geographies, and seeking alternatives to heavily congested or politically sensitive corridors.
That shift is not cost-free. It means more transactions, more counterparties, and more complexity. As supply chains fragment and broaden, the need for reliable risk mitigation tools grows in tandem. Trade finance should be the bridge that enables the shift, but the gap suggests too many businesses are still being left behind.
SMEs May Be Getting a Better Deal, But the Picture Isn’t Settled
Small and medium-sized enterprises are often the hardest hit when financing tightens, and that matters because SMEs form the backbone of construction supply chains. They include specialist manufacturers, regional hauliers, plant servicing firms, engineering workshops, and niche technology providers. In most markets, SMEs also tend to face higher compliance burdens relative to their size, and greater vulnerability to cashflow shocks.
The ADB survey suggests there may be a shift underway. More than 80% of banks reported having dedicated strategies to support SMEs. For the first time, the survey also indicates that SME rejection rates for trade finance (41%) have fallen close to the levels seen for large and mid-cap corporates (40%), although ADB notes that this requires more research.
If that trend proves durable, it could be commercially and socially significant. Expanding SME access to trade finance would help smaller suppliers compete internationally, take on larger contracts, and improve resilience across the procurement ecosystem. It would also help prevent a scenario where only big firms can reliably trade across borders, leaving smaller businesses trapped in local markets, unable to scale.
That said, it’s worth keeping expectations grounded. A 41% rejection rate is still substantial, and for SMEs, a rejected financing request can mean a missed contract, a stalled shipment, or a cashflow crisis that takes months to recover from. The narrowing gap between SME and corporate rejection rates might reflect improved risk tools, but it might also mask deeper issues, such as shrinking overall appetite for financing in certain sectors or regions.
ESG Factors Are Everywhere, Yet Funding Pools Are Under Pressure
Trade finance is increasingly linked to sustainability and governance requirements, and ADB’s survey reflects that shift clearly. Nearly 90% of banks surveyed said they factor environmental, social, and governance considerations into their trade financing decisions. That aligns with the growing role of ESG screening across finance more broadly, where risk management now includes climate exposure, supply chain labour practices, and corruption controls.
For infrastructure, this is a double-edged sword. On the one hand, stronger ESG scrutiny can encourage higher quality outcomes. It can support the movement of cleaner technologies, improved procurement standards, and more accountable project delivery. On the other hand, it can complicate access to finance for firms operating in emerging markets, or for those transitioning from legacy practices to cleaner operations without having the administrative capacity to document everything quickly.
The survey also highlights a constraint that has become more pronounced in recent market conditions. Capital outflows from ESG-focused funds have reduced the potential for ESG-specific capital pools to help narrow the trade finance gap. In other words, even though ESG is being integrated into lending decisions, the dedicated pools of ESG capital that might have accelerated trade finance availability are facing headwinds.
That matters for the energy transition supply chain in particular. Many of the components needed for decarbonisation, from grid hardware to renewable energy equipment, rely on cross-border procurement. If ESG-linked capital is less available, the pace of trade-led deployment could slow, especially in regions that already face financing constraints.
AI Is Becoming a Trade Finance Tool, Not a Buzzword
The growing use of artificial intelligence in financial decision-making has become one of the most tangible themes in the ADB survey. It reports that 84% of banks surveyed already use AI for fraud prevention and risk analysis. Beyond that, 57% are exploring how AI can expand financing capacity.
This is important because trade finance is fundamentally a risk business. Banks must assess counterparty risk, transaction integrity, documentation quality, and fraud exposure, often under tight time pressure. Historically, those processes have been labour-intensive and dependent on manual review, which can create bottlenecks and raise costs. If AI can reduce friction, identify patterns of risk more quickly, and improve fraud detection, it can potentially enable financing decisions that are both faster and more accurate.
For the construction and infrastructure supply chain, the potential benefit is straightforward: faster and more reliable trade finance decisions could support more predictable deliveries of critical equipment and materials. In a sector where time is money, the ability to reduce delays in procurement cycles is not just a nice-to-have. It can translate directly into better programme certainty for large projects, particularly those operating under tight timelines or multi-contractor arrangements.
However, the wider implication is about capacity. If AI tools allow banks to process more transactions without proportionally increasing staffing or cost, they may be better positioned to support growing trade volumes, particularly in complex and fragmented supply chains. That could prove vital as companies diversify markets and deepen intra-regional trade, the very trends that banks expect will push demand upward.
Digital Trade by 2030 and Supply Chain Finance Could Be the Real Fix
While the survey paints a challenging picture, it also points towards specific pathways for improvement. One of the strongest signals is the role of trade digitalisation. ADB emphasises that digitalising trade by 2030 is critical to closing the global trade finance gap.
Digital trade isn’t just about making systems look modern. It’s about reducing the friction and uncertainty in cross-border transactions. Digitised documentation, improved verification tools, and more transparent workflows can help reduce errors, speed approvals, and make fraud harder to execute. That matters because documentation issues and perceived risk are major reasons trade finance can be denied, particularly for smaller firms.
The survey also highlights the importance of scaling innovative supply chain finance, especially solutions that channel liquidity to lower-tier SMEs. This is commercially relevant because many global supply chains depend on sub-tier suppliers who may not have direct relationships with large banks. If financing can flow more effectively through supply chain structures, it could help stabilise entire project ecosystems, not just the top tier of contractors.
For infrastructure delivery, this is a big deal. It means enabling the long tail of suppliers, often the most fragile part of the supply chain, to keep producing, shipping, and delivering without the constant threat of cashflow disruption. Better supply chain finance could also reduce the need for contractors to provide expensive payment terms or bridge funding, helping keep bids competitive and reducing overall project risk.
ADB’s Role in Backstopping Trade in Asia and the Pacific
The Asian Development Bank positions itself as a key institution supporting trade finance across Asia and the Pacific, using guarantees and loans through nearly 300 partner banks. Backed by its AAA credit rating, ADB’s private sector operations are designed to support trade, import and export opportunities, and help maximise the development impact of trade across the region.
In 2025, ADB’s private sector operations supported $5.7 billion in trade. In practical terms, that support matters because multilateral development banks can reduce risk in markets where commercial banking appetite may be constrained. That’s particularly important in developing economies where infrastructure needs are expanding, but financial systems may be less able to support high volumes of cross-border trade finance at competitive terms.
ADB also highlights its role in helping diversify trade both internationally and intra-regionally. This aligns closely with the direction of travel in supply chain management. Intra-regional trade growth can reduce reliance on long-haul routes, shorten delivery times, and potentially lower emissions from transport. It can also provide a more resilient foundation for industrial development and infrastructure delivery, especially in rapidly growing markets.
Beyond trade, ADB positions itself as a leading multilateral development bank supporting inclusive, resilient, and sustainable growth across Asia and the Pacific. Founded in 1966, it is owned by 69 members, including 50 from the region, and works across a spectrum of development priorities including quality infrastructure and climate resilience.
A Gap That Impacts Everyone, Not Just Banks
Trade finance can sound like a specialist topic, but the ADB survey makes it clear that its impact is systemic. A $2.5 trillion financing gap is not a technical inconvenience. It is a brake on global trade at a time when economies are attempting to rebuild resilience and expand opportunity. For infrastructure and construction, the gap can show up as procurement delays, constrained supply chains, and higher costs passed down through projects.
The critical point is that the gap hasn’t narrowed materially in absolute terms. Slight improvement as a share of global trade is welcome, but it doesn’t change the underlying challenge that many firms still cannot access the finance they need. As banks expect demand to rise, the risk is that the gap becomes more painful, not less, unless the industry finds scalable ways to expand capacity.
ADB Director General for Private Sector Operations Isabel Chatterton summed up the stakes clearly: “Trade is central to economic development and has helped to lift millions of people from poverty,” she said. “Without sufficient trade finance, the global economy risks missing out on growth opportunities. We must redouble our efforts to close the trade financing gap to unlock the full potential of trade-driven economic development to transform lives in this region and beyond.”
For the global construction and infrastructure ecosystem, that message lands close to home. Trade underpins the movement of materials, machinery, and technologies that make modern infrastructure possible. Closing the trade finance gap isn’t just about boosting trade volumes. It’s about enabling investment, improving delivery confidence, and keeping the real economy moving, from ports and logistics hubs through to job sites, factories, and energy networks.
