The World Trade Organization and Trade Finance Global have published their latest taxonomy of blockchain projects in international trade, arranged into what they present as a “periodic table” for the industry.
The original rendition of the periodic table was published in winter 2019. Since then, a lot has changed: despite the pandemic, several indicators used in the table show that blockchain trade innovation projects worldwide are reaching ever greater maturity.
On a scale of one to five, projects’ maturity was assessed as being 2.3 on average in Dec. 2019. As of this month, the same figure stands at 3.3. To translate it into non-numerical terms, these projects are now “between the early stages of production and being live and running,” according to the WTO and TFG.
According to the report, blockchain — also known as distributed ledger technology or DLT — has two main benefits from the perspective of international trade. First, it enhances transparency, supporting what the analysts also refer to as “track-and-trace” capacity, which is useful for ensuring products’ authenticity and thereby enhancing trust on the customer end.
The other benefit of DLT is trade digitalization: streamlining trade documentation, processes, and the secure exchange and monitoring of data. Here, the report identifies what it believes remains the “weakest link” in the chain:
“Any digital process will only be as strong as its least digitized link. For many international trade systems this means integrating customs. While several governments are testing or considering using DLT for their customs operations and single windows, most projects remain at a conceptual or piloting stage.”
Latin America is a forerunner on the customs front. The report positively cites the development of a DLT project called Cadena by ICT specialists from Mexico, Peru, Chile and Costa Rica in cooperation with Microsoft and IDB. Cadena is targeted at customs agencies and supports mutual…