Yesterday, the International Chamber of Commerce (ICC), the Singapore Government, and a few global firms signed a cooperation agreement to develop the TradeTrust blockchain framework. The public-private partnership was signed at the annual meeting of the World Economic Forum (WEF). It will work on eliminating paper-based processes by enabling a digital trail of trade transactions.
Additionally, last year the ICC unveiled a separate Digital Standards Initiative, which appears to have similar aims.
TradeTrust is an interoperability framework to be led by Singapore’s Infocomm Media Development Authority (IMDA) with the Maritime Port Authority of Singapore (MPA) and backed by Enterprise Singapore. The goal is to digitalize trade and shipping documents for optimizing workflows and reducing the time and cost of transactions. Additionally, the absence of manual processes can reduce errors and the risk of fraud.
“Digital platforms will lower existing barriers to international trade in the coming years and enable many more businesses to participate in the new global economy,” said John W.H. Denton AO, Secretary-General of ICC.
Denton added, “In line with ICC’s 21st-century purpose, we are committed to enabling the broadest possible adoption of these digital technologies and support the development and recognition of universally accepted best practice standards for digitalization, based on global consensus and the work being done by our partners today.”
Singapore is one of the major trading hubs in Asia and is partnering with several organizations to fast forward its trade digitalization efforts. Companies signed up for the TradeTrust initiative include APRIL, DBS Bank, Marubeni Corporation, Mastercard, Mitsubishi Corporation, Mitsui & Co, Mizuho Bank, MUFG, Noble, NTT DATA, PSA International, Sompo Japan Nipponkoa, Standard Chartered, Sumitomo, Sumitomo Mitsui Banking Corporation, Tokio Marine, and Trafigura.
According to a statement, the TradeTrust framework is being developed for “interoperability across different trade platforms and formats for the exchange of digital trade documents on a public blockchain”.
The ICC previously used the TradeTrust framework to build the ICC TradeFlow platform pilot in collaboration with blockchain firm Perlin, IMDA, commodities trader Trafigura, and DBS Bank.
Last year, the platform executed a $20 million pilot trade for an iron ore shipment from South Africa to China. Meanwhile, the ICC is also working with Perlin on a blockchain ship registration system, backed by the MPA. The two have also set up the Centre of Future Trade (CoFT) in Singapore to help companies to digitize trade and support supply chains and cross-border trade finance.
Singapore-based Perlin is a yet-to-launch blockchain which conducted an ICO raising almost $53 million five months ago. Its market capitalization is currently around $6 million after yesterday’s announcement caused a price bump of more than 10%. Strictly speaking, Perlin’s technology is not a blockchain, because it uses a Directed Acyclic Graph (DAG). Another high throughput solution, IOTA, also uses DAG. Perlin plans to launch its live network this quarter.
In September at SIBOS, separate to TradeTrust, the ICC launched the Digital Standards Initiative, which also aims for interoperability between different technologies and blockchains in trade and trade finance. That group evolved from the Universal Trade Network, an initiative started by Marco Polo and R3. However, it grew to involve all the major enterprise blockchain technology players, banks, and others, and the ICC took on the mantle because of its leadership role in digital standards.