[m3nu]

This works for private buyers, but these gov agencies have a regulation that doesn't allow them to pay in advance ever. The price isn't the issue. So they can only buy from really big firms, who don't have stock right now and aren't flexible.

[fingerlocks]

How do I learn more about this regulation?

[m3nu]

No idea. They told me by email. And it makes sense for normal times.

It's probably in a procurement regulation or guideline.

[keenmaster]

Sure, but why do all of the smaller firms absolutely need cash right now? If they sell to a government or large entity, payment is all but assured. Even if they have a high discount rate, they can factor that into the price. There's no way they all need the money now to remain in operation.

[m3nu]

We are way past discount rates here. Firms without enough cash won't survive. Even if you double or triple the price, it doesn't help if you're out of business when they pay weeks or months later. That's why some kind of financing is needed for larger orders that need like $ 1/4m to 1m in outlay first.

[keenmaster]

Can Chinese banks provide bridge financing? You'd think they would be happy to, since half of them are state-owned and China is in a position to help other countries afflicted by Coronavirus.

The bank can give the mask company money now. Once the American NGO receives the masks, it can directly pay the bank. That way the bank does not have to worry about the mask company stealing its collateral. The bank might even offer to pay for the provision of masks as a donation from China.