New WTO report highlights strong progress in digital trade and recognises TradeWindow contribution to the digital trade ecosystem

At TradeWindow we are welcoming a new report from the World Trade Organisation (WTO) and Trade Finance Global that points to a very active and growing ecosystem for the digitisation of trade. I’ve attached a link at the bottom of this brief article a copy of the report which also profiles TradeWindow’s own contribution to the emerging digital trade ecosystem (page 39).

The new report, called Blockchain and DLT in trade – where do we stand? was released last week in conjunction with the Hong Kong Fintech Week 2020.

DLT refers to Distributed Ledger Technology and describes the technology also used at TradeWindow to ensure the secure and accurate exchange of digital export documents, creating an immutable trail of trust through the distributed ledger.

The report points to an active cohort of businesses around the world racing to develop the next generation of digital solutions for digitalised trade documents using DLT, as well as trade and supply chain finance and insurance solutions, and protocols to enable ‘networks of networks’ for a more fully joined up trade world.

It makes the point that a digitalised trade process is only as strong as its least digitised link and hence it is particularly pleasing to see the progress made in common standards and building a harmonised regulatory framework, particularly through the United Nations Commission on International Trade Law (UNCITRAL).

Interestingly, the report calls out the digitisation of customs documents as an area which is lagging compared to other aspects of the end-to-end supply chain. At TradeWindow we have made particular progress with customs-to-customs blockchain in recent successful trials and we will be talking more about these trials shortly.

The report comes at a pivotal time for world trade as a whole, with the WTO forecasting an overall 9.2% decline in the volume of world merchandise trade for 2020. However, a silver lining is that the current pandemic has accelerated digitalisation in all sectors, including international trade, which remains plagued by labour- and paper-intensive processes. The report concludes that the industry has made steady progress towards trade digitalisation, with the average project moving from a maturity stage of 2.3 out of 5, to 3.3 out of 5.

“Of particular interest for trade digitalisation are projects leveraging distributed ledger technology (DLT) – commonly referred to as Blockchain. The tamper-proof, decentralised and distributed nature of DLT makes it an attractive tool to break the silos that hinder international trade,” the WTO report says.

In relation to this, the report acknowledges the strong progress made by TradeWindow over the past year. By positioning itself as a neutral platform, TradeWindow has attracted an ecosystem of supply chain participants including ASB Bank, Commonwealth Bank of Australia, Mastercard, Swire Shipping, Trade-Van (Chinese Taipei), SWIFT and CGI, and TradeTrust (IMDA) while servicing the needs of 770 customers, including many of Australasia’s leading brands in the primary and manufacturing sectors (see page 39 of the report). https://www.wto.org/english/res_e/booksp_e/blockchainanddlt_e.pdf