Helping To Weather The Storm With A Trade Bank For All Seasons

Treasury and Trade Solutions 4 In Figure 1 1, the colour intensity of the sector corresponds to how ‘concentrated’ that sector is. This can be a useful proxy to help identify sectors in the supply chain that are heavily reliant on a few companies, which may make them more susceptible to supply chain shocks. It is evident from the diagram that Auto Parts and Semiconductor supplies are critical to this sector, but attention should also be paid to the presence of multiple other sectors in this interlinked supply network. Focusing on tech 2 , the shortage of semiconductor equipment unsurprisingly appears to be an even bigger issue for the sector. Other tech supplies such as Electronic Components and Computer Processing Hardware are also prevalent in this sector. Similar to what we have observed of the Industrials sector, the supply chain of tech broadens out rapidly to other sectors with merely tracing upstream by two layers. These observations may demonstrate the expansive nature of global trade and the scale of the problem if their supply chains are disrupted, as the ripple effect could easily expand beyond the immediate supply layer. Through natural language processing (NLP) on corporate filing and other public documents, we analyse corporate sentiment surrounding supply chain issues globally. It appears that the negative sentiment expressed in corporate documents has been increasing since the beginning of 2021 with a large spike seen in the second half of 2021. Figure 2. Supply Chain Dependency — Technology Source: Citi Global Data Insights, Bloomberg 1. The width of each pipe represents the total relationship amount between each supplier and customer sector pair. This helps identify the biggest sectors by dollar amount in the supply chain that are crucial to the final product/service the end companies provide. A darker-colour bar indicates a higher concentration means that majority of the transaction flow for a sector is attributed to a small number of companies 2. Using supply chain data of large 40 tech companies globally