Question

* What do you think international settlement will be in 21st century?

* Could you tell the difference between domestic settlement and international settlement

* What is the government Supported export credit ? What’s purpose of it ?

Answer 1

Ans 1=Cross-border settlements have been augmenting swiftly & have reached levels which are rather big relative to overall settlement volumes in majority of the national settlement arrangements in the 21st century.

The Bank for International Settlements is an international financial body which aims to foster global financial & monetary stability thru the coordination of central banks worldwide & their monetary strategy efforts.

BIS is usually known as the ‘central bank for the central banks’ as it provides banking services to establishments like the European Central Bank & Fed. These services comprise conducting & currency & gold transactions, as well as making short run collateralized loans.

It also encourages co-operation amongst the central banks. The BCBS is accountable for the Basel Accords, which suggest capital stipulations & other banking regulations which are widely executed by national governments. The BIS also conducts studies into economic concerns & publishes reports.

Ans 2=In fact, the only inherent distinctions between risks in international settlements & domestic settlements are distinctions in legal risks & the likelihood of forex settlement risks to crop up in the international settlement context. By definition, international settlements incorporate manifold legal jurisdictions, thereby raising concerns pertaining to the choice of law & the conflict of laws which complicate the analysis of licit risks & can introduce additional sources of risk. Additionally, if money settlements in international currencies are funded thru foreign exchange transactions, non-resident counterparties encounter forex settlement risks.

Ans 3=Export credit-

• Export credit organizations provide loans & insurance to firms to aid eradicate the uncertainty of exporting to other nations.

• Some ECAs function from governmental departments, whilst some others function as private firms.
• ECAs are becoming dominant players in international project funding & exports.