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WTO Analyses Potential Impact of Blockchain on International Trade

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Marex

2018-11-27 17:57:30

The World Trade Organization (WTO) has published an analysis of the potential impact of blockchain technology on international trade: Blockchain and International Trade: Opportunities, Challenges, and Implications for International Trade Cooperation.

Blockchain technology is a tamper-proof, decentralized record of transactions that allows you to collaborate and build trust with each other. The technology first emerged during the 2008 financial crisis, at a time when people's trust in institutions, in particular financial institutions, was very low. Bitcoin – the famous and highly controversial cryptocurrency.

A recent study has estimated that the gains from the technology could deliver $ 3 trillion dollars of value worldwide by 2030. It is anticipated to help the administration of intellectual property rights and enhance government procurement processes. Other potential benefits identified by the publication include cross-cutting opportunities, enhance supply chain transparency and open up new trading opportunities for micro, small and medium-sized enterprises.

"WTO Director-General Roberto Azevêdo said:" International trade transactions often involve dozens of actors along the supply chain and remain highly paper intensive. "Blockchain could enhance the transparency and traceability of supply chains, accelerate the digitalization of trade transactions and automate processes. "It could give rise to new generation of services, particularly in areas like transportation and logistics, financial services and insurance."

However, there are challenges that must be addressed before the technology can be used on a large scale. These include issues such as the technology can be scaled up for large or complex applications, how immune is it to security threats, to what extent mainstream use of the technology.

"Blockchain could accelerate the digitalization of trade transactions, but only do so if the legislative framework allows for the validity of e-transactions and e-signatures," said Azevêdo.

The publication calls for a multi-stakeholder dialogue to assess the practical and legal implications of the technology. "While this technology opens up opportunities, it also raises legal, regulatory and policy issues that deserve our attention," said Azevêdo. "We need to consider how to spread the opportunities and overcome the challenges. We can only do this if we are in full possession of the facts. We need to fully understand the technology

The report cites Maersk and IBM's Blockchain-based global trade platform, TradeLens. The platform was officially launched in August 2018 after having been piloted for several months. Called clearway, enables importers, exporters, customs brokers and trusted third parties, such as customs and other government agencies, to cooperate and allows for the automation of various business processes such as import and export clearance via smart contracts.

Says "author report" Emmanuelle Ganne "The success of the platform will depend on whether the various actors involved in international trade are willing to sign up." "Several freight forwarders and customs brokers", as well as more than 20 marine gateways, as well as two other ocean carriers, and customs authorities in Australia, the Netherlands, Peru, Saudi Arabia and Singapore, were already participating, or had announced that they would participate in the platform. "

Gunn, says that if these projects happen, the future of the industry and the biggest disruptor to the industry and to the international trade since the invention of the container.

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