TradeTech’s Trillion-Dollar Promise
17 Jan 2024 10:15h - 11:00h
Event report
Technology is revolutionizing global commerce and investment and digitalizing the trade ecosystem holds the potential to increase trade by nearly $9 trillion by 2026 within the G7 alone.
How are technological, regulatory and business model innovations addressing the hurdles to digitalizing global trade and FDI to harness this massive potential?
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Vincent Clerc
The global trade industry is facing challenges due to fragmented data connectivity, with data standards and interchange being complex, resulting in barriers that hinder progress. However, TradeLens aims to address these issues by providing data standards and connectivity for global trade. This initiative is designed to create a utility that promotes standardization and connectivity in the industry.
The global supply chain is plagued by fragmentation, which leads to siloed data and slows down progress. The data in the supply chain is not easily accessible, making it difficult to achieve network effects. This fragmentation is driven by concerns related to cyber and security implications, as well as competitiveness. As a result, there is a high cost associated with the fragmented nature of the global supply chain.
Furthermore, barriers on the data and technology side have a greater impact on emerging economies compared to the physical barriers of trade. The inability to connect and create necessary infrastructure is a major challenge for these economies. This highlights the need for a comprehensive approach to address the barriers faced in the realm of data and technology.
Efforts to break down these data barriers require a multi-pronged approach. While initiatives like TradeLens aim to provide connectivity and standards, it is important to recognize that simply building these platforms does not guarantee participation. TradeLens discovered this firsthand when the expected benefits failed to attract widespread use. Therefore, it is crucial to engage stakeholders effectively and demonstrate the advantages of these initiatives to encourage wider adoption.
Private enterprises play a key role in the development of infrastructure necessary for global trade. It is their responsibility to invest in and create the right frameworks and systems to support seamless data connectivity. Additionally, the lack of a multilateral approach to standards poses challenges. Without cohesive efforts, the development of infrastructure that lowers barriers becomes more difficult.
Regulators should focus on creating a level playing field that does not disadvantage emerging markets. It is important to consider markets that may not be information-ready and ensure they are not left behind due to regulatory barriers. This approach will help reduce inequalities and promote decent work and economic growth.
Accepting data standards developed by others can deliver the desired outcomes in terms of connectivity and standardization. It is important to recognize the value of collaboration and the benefits that can be gained from adopting existing data standards that meet the required criteria.
Disruptions in the Red Sea, such as the current situation, are not a sign of deglobalization but rather a consequence of long-standing geopolitical conflicts. The Red Sea region is vital for global trade, with around 20% of global trade passing through the Bab el-Mandeb Strait. These disruptions highlight the geopolitical complexities that can affect global trade but should not be interpreted as a shift towards deglobalization.
Digital connectivity and seamless data interactions in the global supply chain are seen as essential and should be treated as separate from geopolitical issues. The need for efficient data interactions and connectivity transcends geopolitical conflicts and remains a fundamental requirement for the industry.
Technology has the potential to significantly transform society, and there is a growing mobilization around the necessity of technological progress. Examples of societies leapfrogging advancements through technology are emerging, and Vincent Clerc, an industry expert, is optimistic about the opportunities that technological advancement can bring.
In conclusion, the global trade industry faces challenges in terms of fragmented data connectivity, barriers on the data and technology side, and a lack of standardization. Efforts like TradeLens aim to address these issues by providing data standards and connectivity. Private enterprises have a role in developing infrastructure, and a multilateral approach to standards is required. Regulators should ensure a level playing field for emerging markets, and accepting existing data standards can deliver desired outcomes. Disruptions in the Red Sea are not indicative of deglobalization, and digital connectivity remains a critical requirement. Technology has the potential to transform society, and there is growing support for its advancement.
Anwaar-ul-Haq Kakar
The analysis explores various aspects of technology, competition, and the equitable distribution of resources. One significant finding is that strategic competition often overshadows economic competition, which is based on a rule-based world order. This overshadowing has negative implications for economic competition.
The analysis also highlights the hindrances faced by technological enhancement and research and development (R&D) due to "lawfare" and strategic competition. "Lawfare", the use of legal actions as a tool, discourages further advancements in technology. This suggests that prospects for technological growth and innovation are hindered by the prevalent strategic competition.
Another crucial point is the impact of an inequitable distribution of technology. The analysis reveals that when strategic competition occurs in terms of technology, a significant portion of the global population is left behind. Impoverished nations and countries are unable to benefit from the advancements in 21st-century science. This underscores the need for a fair distribution of technology to ensure accessibility for all.
An important consequence of an inequitable technology distribution is the triggering and amplification of conflicts. The analysis argues that without a fair distribution, conflicts will continue to escalate. This highlights the negative repercussions associated with the disparity in access to technological advancements and the urgency for equitable distribution.
Additionally, the analysis underscores the differences in approaches taken by governments and regulators when addressing trade-related challenges. This observation highlights the need for urgently addressing regulatory concerns to ensure effective trade practices.
On the other hand, the analysis suggests that the private sector should take the lead in shaping regulations. Private sector leadership is seen as influential in shaping policies and regulations related to technology and innovation. This underscores the importance of active private sector involvement to drive positive changes in the regulatory landscape.
Lastly, the analysis reveals that governments are reluctant to relinquish control over various aspects such as information, trade, and security. This reluctance underscores the significance of maintaining a balance through two-way communication to address concerns related to control, ensure peace, justice, and foster stable institutions.
In conclusion, the analysis highlights the overshadowing of economic competition by strategic competition, hindrances faced by technology due to "lawfare" and strategic competition, and the impact of an inequitable distribution of technology. It emphasizes the urgent need to address regulatory concerns and praises the active involvement of the private sector in shaping regulations. It also underscores the importance of balanced two-way communication in achieving peace, justice, and stable institutions. Overall, these insights shed light on crucial aspects of technology, competition, and equitable distribution that require attention and action.
Megan Davies
During a panel discussion on trade technology, the participants explored the potential of technology to enhance global commerce and address the trade finance gap. The esteemed panel included His Excellency Anwar Haqqaqa, the Prime Minister of Pakistan, as well as industry experts Dr. Tanipin Ahmed Al Zayoudi, Vincent Clerc, Her Excellency Dima Al Yahya, and Bill Deng.
Prime Minister Haqqaqa opened the discussion by emphasizing the need to leverage technology to increase trade and foreign direct investment (FDI) while reducing the trade finance gap. The panel then engaged in a lively conversation covering various aspects of trade technology.
Dima Al Yahya emphasized the importance of promoting equitable trade in a world where deglobalization is gaining momentum. The discussion then focused on the challenges of creating globally used systems, with reference to Maersk's TradeLens project, led by Vincent Clerc. Clerc shed light on the hurdles faced in establishing such systems and shared thoughts on future strategies for development.
Bill Deng, a platform builder striving to globalize and support small and medium-sized enterprises (SMEs), provided insights into the challenges they face and their ultimate goals. The conversation then turned to Dr. Tanipin Ahmed Al Zayoudi, who offered potential solutions to the issues raised throughout the discussion.
Prime Minister Haqqaqa reiterated the breadth of issues at hand and emphasized the urgency of developing specific technologies or strategies. The focus then returned to Dima Al Yahya, who reiterated the challenges faced in global trade, particularly in the Red Sea region. Vincent Clerc contributed to the conversation by exploring the potential benefits of multinational collaboration and advanced technology in addressing these challenges.
The panel concluded with participants outlining their hopes for addressing the issues and the steps their organizations are taking to contribute to solutions. Overall, the discussion highlighted the potential of technology in fostering global commerce while stressing the importance of equitable trade and narrowing the trade finance gap.
Bill Deng
Regulatory compliance for Anti Money Laundering (AML) poses a significant challenge for Bill Deng's global platform, which primarily caters to importers and exporters, particularly small and medium-sized enterprises (SMEs). This compliance involves ensuring that each movement of money is supported by a genuine and legitimate trade background. However, a major hurdle Deng faces is the lack of standardisation from regulators regarding AML checks and risk management. This lack of consistency results in difficulties in establishing and maintaining formal compliance.
Deng's experiences have highlighted the necessity of frequent communication with regulators. As his platform serves 160 countries, he requires a global team dedicated to regulatory communication. The absence of clear and uniform guidelines from regulators makes it difficult to implement robust AML measures and effectively manage risks.
Interestingly, Deng's entrepreneurial spirit is fuelled by challenges. He believes that overcoming various obstacles is what adds value to the work of entrepreneurs. This mindset reflects his refusal to buy into the notion of de-globalisation. Deng firmly believes that global business is an everyday reality, and he remains committed to expanding his platform globally, despite the challenges.
In addressing global business challenges, Deng recognises the potential of AI-driven infrastructure. He acknowledges that advanced technology, such as AI, can play a vital role in resolving regulatory issues and facilitating connections in the global business landscape. By leveraging AI tools and solutions, Deng aims to streamline processes and enhance compliance measures within his platform.
Another crucial aspect Deng emphasises is the need to build global teams capable of handling business operations in multiple countries. As his platform operates in up to 160 countries, establishing diverse and competent teams becomes necessary. The ability to navigate cultural and regulatory differences is vital in ensuring successful and efficient operations on a global scale.
Furthermore, Deng identifies opportunities for collaboration through shared data. He envisions potential partnerships with shipping companies, recognising that data sharing can lead to increased collaboration and improved business outcomes. By pooling resources and knowledge, Deng believes that collaboration can create synergistic effects and tackle shared challenges more effectively.
Overall, Deng's outlook on innovation and regulatory accommodation is optimistic. He perceives the regulatory landscape as a challenging yet achievable space for implementing new and innovative solutions. Deng hopes for greater flexibility from both partners and regulators, allowing room for creative approaches to address regulatory compliance and foster technological advancements.
In conclusion, regulatory compliance for Anti Money Laundering (AML) presents a significant challenge for Bill Deng's global platform. The lack of standardisation from regulators regarding AML checks and risk management further complicates compliance efforts. However, Deng's entrepreneurial spirit remains undeterred as he firmly believes in the value of overcoming challenges and rejects the idea of de-globalisation. Leveraging AI-driven infrastructure and fostering collaboration through shared data are essential strategies for addressing global business challenges. Deng also calls for greater regulatory accommodation and a supportive environment for innovation.
Thani Ahmed Al Zeyoudi
The use of technology in the trade industry has brought significant positive changes and played a crucial role in crisis management. The adoption of technologies such as AI and blockchain has proven effective in addressing challenges faced during crises. For example, AI technology enables the industry to make informed decisions and predictions by analyzing large volumes of data, thus assisting in crisis management. Furthermore, blockchain provides secure and transparent transactions, revolutionizing trade finance and enabling faster and more efficient processes.
In addition, technology improves customs processes, leading to streamlined trade. By using technology such as automated systems and digitized documentation, the number of steps involved in customs can be reduced. The United Arab Emirates (UAE) successfully implemented these technologies, resulting in noticeably efficient trade operations.
Technology also has a significant impact on trade finance. Blockchain technology, in particular, is a transformative force in this aspect. By leveraging blockchain, trillions of dollars in trade value can be enhanced, leading to greater efficiency and speed. The UAE Trade Connect program exemplifies how technology improves the speed and reliability of trade processes.
The private sector also plays a crucial role in technology adoption. Initiatives taken by major ports, such as those owned by Abu Dhabi and DB World, have been instrumental in driving transformation. These ports have developed comprehensive platforms that facilitate the clearance of trade documentation and finance, expediting the overall trade process.
However, the rapid development of technology poses challenges in creating supporting regulations. The time-consuming nature of regulation development conflicts with the fast-paced advancements in technology. This discrepancy needs to be addressed to ensure effective governance and control.
Additionally, current technological interlinkages can create barriers due to excessive data requests, posing a challenge to data privacy. Striking a balance between access to information and respecting data privacy is crucial for smoother technological integration.
Trust is another vital factor in technological integration and global development. Building and maintaining trust among stakeholders are paramount for successful collaboration and cooperation. Trust forms the foundation for effective partnerships and sustainable technological integration.
To ensure seamless integration, technology development should enable easy integration with other platforms, enhancing connectivity and interoperability, fostering a robust trade ecosystem.
A systematic approach is necessary for transformation in the trade sector. Understanding needs and requirements, piloting internally, establishing concrete projects at the national level, and eventually expanding globally and interlinking with trade partners worldwide are crucial steps.
The idea of de-globalization is opposed in the context of trade. The world is currently rebalancing itself, and diversity is seen as a key driver of growth. Working with different partners and exploring new avenues of collaboration is essential for sustainable trade development.
Trade is a necessity for the economy, impacting various aspects such as job creation, manufacturing, and financial movement. The importance of trade in contributing to economic growth and stability is undeniable.
Lastly, a focus on doing the right thing in trade is emphasized. Ensuring that trade benefits reach the right people and adhering to ethical practices are essential for creating a fair and just trade environment.
In conclusion, the integration of technology in the trade industry has brought numerous positive changes. From crisis management and improved customs processes to advancements in trade finance, technology has proven instrumental in enhancing the trade ecosystem. With the support of the private sector, regulatory alignment, and trust-building, the industry can continue to integrate technologies for the benefit of trade and economic growth.
Deemah Al Yahya
The digital divide between countries is widening, as some nations are experiencing significant growth in the digital economy while others are being left behind. This disparity is evident in the fact that around 2.7 billion people remain unconnected and offline, unable to access the benefits and opportunities offered by the digital world.
To address this issue, it is crucial to adopt an ecocentric approach, which involves sharing best practices and knowledge among countries. By moving away from an egocentric mindset and promoting collaboration, nations can work together to bridge the digital divide. This approach recognises that no single country or entity can solve this challenge alone.
In order to facilitate trade tech and provide financial aid, innovative methods such as cross-funding, crowd-funding, and blockchain exchanges need to be explored. These methods can help raise funds to enable connectivity and bridge the digital gap. By embracing these innovations, countries can unlock new opportunities and create a more inclusive digital economy.
Furthermore, cooperation between nations, the private sector, and civil society is vital for ensuring the development of global standards and fostering the growth of e-commerce. This collaboration not only promotes security and transparency but also helps establish a level playing field for businesses operating in the digital space.
A multilateral approach is necessary for effective communication between innovators, the private sector, and governments. By working together and sharing knowledge, countries can leverage each other's strengths and overcome challenges more effectively. Initiatives such as the Digital FDI initiative with the World Economic Forum demonstrate the importance of this collaborative approach.
The private sector also plays a significant role in driving innovation and should be entrusted with responsibility. It is essential to support the private sector's efforts and align policies and regulations to encourage its growth and development.
Creating an innovative and flexible environment for policy-making and regulation is crucial to ensure the quick adaptation of new technologies. By fostering an environment that encourages experimentation and collaboration, governments can effectively address the changing needs of the digital era.
Easing trade and stimulating the business environment are key factors in attracting more investment. By removing barriers and implementing supportive policies, countries can create an environment that is conducive to business growth, thereby encouraging both domestic and foreign investment.
The adaptation and utilisation of new technologies like AI have the potential to revolutionise various sectors. It is crucial for countries to embrace these advancements and harness their benefits to drive progress and innovation.
However, it is concerning that approximately 350 million women may still lack access to the internet by 2030. Technology can be a powerful tool in empowering women and expanding their market opportunities. By facilitating the transition of traditional women-run businesses to the online sphere, we can create more jobs and promote gender equality.
To bridge the communication gap between the private sector and the government, there is a need for co-creation and collaboration in policy-making and regulation. By involving both parties and fostering dialogue, innovative policies and regulations can be developed that address the needs of all stakeholders.
Launching Digital Space Accelerators, a new module of collaboration and cooperation, can help address digital trade issues. By involving governments, the private sector, and civil society, these accelerators can focus on critical issues such as Triple P, digital trade agreements, framework agreements, intellectual property, and digital rights. The anticipated outcomes from these accelerators by the end of the year are expected to drive positive change.
In conclusion, the digital divide between countries is a growing concern that needs to be addressed urgently. By adopting an ecocentric approach, embracing innovative methods, promoting cooperation and collaboration, and creating a conducive environment for technology adoption, governments, the private sector, and civil society can work together to bridge the digital divide and create a more inclusive and prosperous digital future.
Speakers
AK
Anwaar-ul-Haq Kakar
Speech speed
123 words per minute
Speech length
711 words
Speech time
346 secs
BD
Bill Deng
Speech speed
161 words per minute
Speech length
453 words
Speech time
168 secs
DA
Deemah Al Yahya
Speech speed
138 words per minute
Speech length
1165 words
Speech time
505 secs
MD
Megan Davies
Speech speed
159 words per minute
Speech length
723 words
Speech time
273 secs
TA
Thani Ahmed Al Zeyoudi
Speech speed
186 words per minute
Speech length
1442 words
Speech time
466 secs
VC
Vincent Clerc
Speech speed
200 words per minute
Speech length
1693 words
Speech time
507 secs
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