00:00Digital advances have increased global productivity while saving time and money.
00:06That's according to the International Chamber of Commerce in the UK.
00:09The introduction of artificial intelligence and customs has reduced processing time by 80%.
00:15In Bangladesh, there was a 25% rise in productivity when import and export flows went digital earlier this year.
00:23E-docs, that's documents accessed online rather than on paper,
00:27reduced the cost of trade between China and Singapore by 30% and made it 75% faster.
00:34And when China's new digital ID launched in July, it cut costs by 70% while speeding up identification by 90%.
00:43Let's talk now to Chris Southworth, who is the Secretary-General of the International Chamber of Commerce UK.
00:49Good to see you again, Chris.
00:50So you're calling these digital trade superhighways, aren't you?
00:54What do you mean by that?
00:56Well, and in the context of the conversation just prior to me,
01:01you know, digitalization of trade is a solution to enabling companies to be more agile in a volatile world.
01:08You know, no companies want to have their cash trapped in their supply chains.
01:12They want to ship their goods in and out of markets as fast as possible.
01:15And digitalizing trade processes is one way to do that.
01:19And you've tripped off some of the evidence for it.
01:22So what we're saying in this new report is a vision for how do we digitalize trade globally.
01:28There are about 2,000 to 3,000 trade corridors, probably more, air, road, rail and sea.
01:33Trying to digitalize every single one at the same time is a heck of a task.
01:39What we're saying is, you know, if you take the analogy of roads, a country wouldn't upgrade every single road at the same time.
01:46They would pick the trunk roads first and then in due course do the rest.
01:49And we're applying the same logic to trade corridors.
01:52What we're saying here is there are two archeries of global trade.
01:56One is Europe-Gulf Asia, the maritime silt route to China and beyond.
02:01And the other one is transatlantic Europe to the east coast of the U.S.
02:05And along those two routes are seven global trade finance and logistics hubs,
02:11all of whom have sophisticated architecture and infrastructure in place, but they're not quite interoperating.
02:17And the data and the information isn't quite moving in the way it needs to digitally in order to make trade cheaper,
02:24faster and simpler for everybody using those two corridors,
02:28which handle the lion's share of global maritime trade and global trade finance.
02:33So a digital trade superhighway effectively is where everything is moving at pace,
02:39cheaper, faster and simpler for everybody involved.
02:42So it sounds like there are lots of nip and tucks to be made in different places.
02:46Your report suggests that could unlock over $10 trillion in efficiency.
02:52How quickly might those savings be unlocked?
02:57Well, that's a great question.
02:59That's the question that's really being asked by all of us.
03:02The challenge is how do we accelerate digitalization in order to unlock that value?
03:07What we are definitely seeing is the unlock of that value at company level.
03:12What we now need to do is get all companies doing this so that we unlock the full amount.
03:17$10 trillion, by the way, is probably an understatement.
03:20That's taken from case studies, business cases, sorry, across G7, the Commonwealth and ASEAN.
03:26That doesn't cover a lot of the rest of the world.
03:28But if you add that up, that's a reflection of the inefficiency in the current trading system.
03:33If we digitalize and modernize trade, use smart technologies like AI at real scale,
03:39then there's a terrific opportunity here to drive efficiencies and growth and productivity all at the same time for everybody.
03:46So what will success look like here?
03:49How will we know that these digital superhighways are really working to improve trade?
03:55Well, in the current trading environment, there are around nine, eight or nine billion pieces of paper moving around the system.
04:02It's an incredibly antiquated, fragmented system.
04:05Success is when that goes and it's all replaced by fast movement of data in minutes, not weeks and months.
04:13Less fraud and risk of loss and delay in shipments and payments and trade moving cheaper, faster, simpler, as I say.
04:24And also better access to finance, more financial inclusion, especially for small companies who really struggle to access the financial or working capital cash in order to do cross-border trade.
04:38All of that starts to evaporate once you go digital.
04:41And the case studies we're publishing today are a good example of exactly what happens when you do move to modern systems.
04:48Chris, great to talk to you. Thanks for coming on the program.
04:51That's Chris Southworth from the International Chamber of Commerce in the UK.
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