As trade is increasingly dominated by advances in technology, the time is now to ensure nobody gets left behind. At the recent UN World Trade Organisation Public Forum, its Director-General, Roberto Azevêdo, made that clear. He said: “We can’t simply leave our future to chance, or trust it only to market forces. We have a duty to make this revolution work for everyone.”
Some regions lag behind, but Asia is at the forefront of this revolution, according to research by the UN’s Economic and Social Commission for Asia and the Pacific, areas such as Africa hindered by illiteracy and poor internet access.
Jack Ma, founder of Chinese ecommerce platform Alibaba, claimed that 90% of business will be online by 2025, predicting that the global economy will be largely driven by a myriad of small companies mostly from developing countries instead of being driven by 6,000 multinational companies as we see today. He said that in turn, e-commerce will offer huge opportunities for young people and women, leading to truly inclusive global trade.
Blockchain will be a major player in this process. Though there are still flaws such as data privacy to iron out, it could potentially result in more loans being released by banks as it can provide more quality and timely information and allow the bank to go beyond the usual risk assessment exercise. The technology, which breeds transparency, can also build trust between buyers and sellers, allowing the consumer to better understand food and ethical trading.
In October, Emmanuelle Ganne, Counsellor at the WTO, said: “Blockchain technology has the potential to foster the emergence of new business models, it will allow SMEs to have more trade finance, and the good news for women and SMEs is that they do not have to build a platform by themselves, they just need a mobile phone to connect and trade.”
Other technologies are underway, being created from the ground up. Sauti, a mobile information platform based in Kenya, was set up to empower women cross-border traders to work safely, legally and profitably across East Africa. Cross-border trade provides crucial opportunities to advance women’s economic and social empowerment across the East African Community, but women traders also face specific challenges. With limited access to market and trade information, particularly among small-scale enterprises, women traders are left vulnerable to loss of profits, exploitation by dishonest middlemen, and harassment at the border.
With backing from The Hague Institute for Innovation of Law, Sauti’s technology leverages SMS and Unstructured Supplementary Service Data technology to deliver up-to-date information on commodity prices, exchange rates, and official border-crossing procedures. It can be used with any mobile phone and the women can access tailored business information in addition to giving them a place to report real-time border experiences in their local languages.
Facebook Messenger bot, Patentbot, created in Ukraine, and also backed by The Hague Institute for Innovation of Law, is a chatbot that helps companies check and register a trademark using blockchain technology. Patentbot checks if the trademark is free before companies register online through the service, which can often take long periods of time and add up to huge costs for a small company. For a small fee, Patentbot also offers legal advice to companies and since inception by its founder Nataly Vladimirova, a patent attorney, has successfully granted over 500 trademarks.
One company in Indonesia has expanded its expertise in e-commerce to connect SMEs. Winning praise from the G20, Bukalapak was started as an online marketplace, but has since expanded to providing services to SMEs, signing up over 3,000 kiosks and small neighbourhood stores to help bolster trade to those outside the world of e-commerce. It too started as a small business, but has reached ‘unicorn’ status, meaning it is now valued at $1bn or more, with more than 50 million users and around half a million transactions per day. This is a huge opportunity for the thousands of small traders offline, with the hope that without the many often scrupulous middlemen, prices of goods do not need to be so high, in turn, raising incomes for merchants. Subsequently, the business model helps boost the more informal business sector and accelerates social development.
Academics argue that while more inclusive trade may not always deliver economic gain or mitigate economic loss, it may provide for better redistribution in addition to representation. It is now on the agendas of the international organisations such as the OECD and the WTO in addition to that of several national governments including Canada, Chile and New Zealand, but to ensure small businesses and marginalised populations such as women and the under-banked get better access, more policies are needed globally to ensure the technology reaches the right people.
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