Some countries and cities are crucial for international finance, despite their modest GDP and population size. Here are some European examples:
- Geneva (with Zug and Lugano) handles up to 60% of the international trade in certain commodities (cereals, cocoa, coffee, sugar, metals, oil, cotton)1.
- Luxembourg is the domicile of collective investment funds which combined hold assets worth more than 5 trillion dollars. Luxembourg is also a banking center.
- Ireland is the global leader in aviation finance. It is also an international fund center, albeit smaller than Luxembourg.
- Banks (e.g. ING) finance the traders. However, some banks like ABN AMRO and BNP Paribas have decided to pull back from financing commodity traders. The FT cites scandals, losses and regulations as factors contributing to this shift.