Customs Applications for Blockchain Seen as Promising
CBP has identified 14 use cases for blockchain as part of its pilot of the technology, according to Kati Suominen, founder and CEO of Nextrade Group and the lead speaker at a Center for Strategic and International Studies panel discussion on harnessing the technology. But the U.S. is not out front in adopting blockchain technology, either in business or in government, she said. Fifteen countries in Africa are using blockchain in customs, and Mexico, Costa Rica, Peru, South Korea and Singapore are all experimenting with it as well.
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Suominen, who was speaking Nov. 1, suggested that developing countries could leapfrog more advanced countries by digitizing paper processes at the border directly into blockchain. She said the Global Alliance for Trade Facilitation, which helps underwrite upgrades to customs processes in poorer countries, should consider spending on blockchain.
Suominen said that when a shipment arrives at the border, many agencies "need the same data on the same shipment at the same time. Their databases are not necessarily all harmonized, or all interoperable." She said blockchain can provide a neutral platform for those agencies to access that data simultaneously. Logistics is a natural place for blockchain to spread in the private sector as well, panelists said. Exporters and importers who have not worked together before will be able to examine each others' track records on a blockchain ledger, which would make establishing relationships less risky, she said.
Marie Wieck, general manager of blockchain at IBM, said that when the technology becomes ubiquitous, it will save businesses tremendous amounts of money. One estimate is that in 2030, it will provide $3 trillion in benefits, she said. Some of these savings will come from eliminating the need for middlemen to provide trust between two unknown parties, the panelists said. Supply chains and trade will be the biggest sectors using the technology, she predicted. She said one day, no one will talk about "blockchain" just like no one talks anymore about the internet protocol technologies that make the internet usable around the world.
The question of common standards -- so important to the internet -- is one still plaguing blockchain (see 1805080023). The panelists said the fact that Asia and Europe seem to be adopting blockchain sooner than U.S. players may mean they'll be in a position to write standards, rather than the U.S.