248/ DDG Yi: Regulatory work needed to enhance trade impact of blockchain technologies
2 December 2019
In his opening remarks at the Global Trade and Blockchain Forum on 2 December at the WTO, Deputy Director-General Yi Xiaozhun said that policy action and coordination among key stakeholders are necessary to fully realize the potential of blockchain technology to transform international trade. DDG Yi also announced the launch of a new publication on blockchain by the International Chamber of Commerce, Trade Finance Global and the WTO. This is what he said:
Ambassadors, distinguished guests, ladies and gentlemen,
Good morning.
It is my great pleasure to welcome you to the WTO Global Trade and Blockchain Forum. Just a year ago, we had our first event on blockchain here at the WTO and launched our first publication on this topic entitled “Can Blockchain Revolutionize International Trade?”
This year, we decided to upgrade the event into a two-day conference to allow a deeper dive into a technology that is seen by many as a potential game changer for international trade.
Let me begin by thanking our Economic Research and Statistics Division for having put this event together. My thanks also go to all the colleagues from other divisions who took the lead in organizing specific sessions, in particular colleagues from the Agriculture and Commodities Division; the Development Division; the Enhanced Integrated Framework; the Intellectual Property, Government Procurement and Competition Division; and the Trade and Environment Division.
Much has happened since we had our first event a year ago. The level of activity around distributed ledger technologies — colloquially termed “blockchain” — in the area of trade is impressive. The number of consortia and initiatives that leverage blockchain to remove frictions along the supply chain, facilitate trade finance processes and border procedures, help fight counterfeits and facilitate the management of intellectual property rights has been skyrocketing.
Like with any new technology, there has been a hype, no doubt. But the good news is that some of these projects are now moving into production. Where do we stand? What is the potential of blockchain to transform international trade?
We’re launching today a new publication with Trade Finance Global and the International Chamber of Commerce that provides an overview of the main projects underway in trade, with a focus on trade finance, shipping, and the digitalization of trade documents.
Based on a survey of more than 200 actors in the field, this publication discusses the key challenges that companies involved in blockchain trade-related projects are facing and discusses actions that may need to be taken to allow the technology to truly transform international trade. The publication also provides an estimate of the stages of maturity of the various projects listed. On average, trade-related blockchain initiatives are between the pilot and early stages of production. In a moment, you will hear a more detailed presentation of this study.
This Forum will give you an opportunity to hear directly from practitioners in the field about some of these projects, the opportunities they open for international trade, and the challenges that need to be addressed.
While many of these projects are driven by companies, blockchain initiatives are not confined to the private sector world. In fact, an increasing number of governments and public entities are looking into the technology.
I’m delighted that we have with us today two keynote speakers who will share their vision of blockchain from a public perspective: Dr Marwan Alzarouni who is member of the Dubai Future Council for Blockchain Technology and CEO of the Dubai Blockchain Center and Ms Helen Kopman, who is Deputy Head of Digital Innovation & Blockchain at the European Commission. A big thank you to you two for having come all the way to Geneva.
The trade landscape is changing fast, driven by technological developments. A myriad of projects endeavour to make trade more efficient, more transparent and more inclusive. This is good news. But will this be sufficient?
Technology is only a tool. If we want this technology to truly transform international trade, we will need more than simply the technology.
For example, many of the projects that are being developed follow a siloed and disconnected approach, leading to fragmentation between systems and networks. This is what is often called the “digital island problem”. Solving this problem will require more than technical solutions. It will require alignment of key stakeholders on issues such as data models and processes. And this can only be done through multi-stakeholder and cross-sectoral discussions.
Likewise, some action may be needed at a policy level to provide a secure and predictable regulatory environment that allows the technology to be deployed on a large scale. Blockchain can accelerate the digitalization of international trade, but it can only do so if the legislative framework allows for transactions to be carried out through digital means and if those transactions are recognized as legal and valid — if, for example, laws recognize the validity of e-signatures and e-documents, not only at the national level, but also in a cross-border context.
Empowering developing countries and the smallest players to reap the benefits that this technology opens is also a must.
No doubt, blockchain opens interesting opportunities. But it also raises legal, regulatory and policy issues that deserve our attention — that deserve the attention of all stakeholders.
This Forum, which brings together a broad range of actors — trade officials and policy makers, large and small companies, tech companies, business associations, and representatives of other international organizations — is an attempt to foster discussions on these issues at a cross-sectoral level with the wider community.
In the same spirit, we launched a few months ago with the International Chamber of Commerce, and with the United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT) and the World Customs Organization as strategic partners, an online dialogue on global trade and blockchain that brings together the business community, blockchain experts, government authorities and international organizations.
Nikolaus Schultze, Director of Policy and Global Affairs at the ICC, will say a few words on this in a moment on behalf of the ICC-WTO partnership, and recommendations having emerged from this dialogue will be presented tomorrow in Session 8. This is an open dialogue so if you’re interested in discussing the practical and legal implications of blockchain for international trade, please join the online discussion at Tradedialogues.org.
We have a rich agenda for this Forum. Discussions will cover a wide range of issues from agriculture, to transportation, trade facilitation, standards, trade finance and inclusiveness. I hope that today’s and tomorrow’s discussions will provide useful insights and food for thought and that the ideas that emerge will help guide members’ thinking and actions going forward.
We have a fantastic set of speakers with us for these two days, so I have no doubt that it will be a very productive event. Enjoy the discussions!
Thank you for listening.
Source: wto.org
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