You are here
International partners ink pact with IMDA to collaborate on digital trade
THE International Chamber of Commerce (ICC) and 17 major multinational firms have signed a cooperation agreement with Singapore's Infocomm Media Development Authority (IMDA) to boost digital trade, which could result in wider adoption of Singapore's TradeTrust framework for connecting digital trade platforms.
Signed at Davos on Wednesday alongside the annual World Economic Forum meeting, the agreement is part of efforts to move from the existing paper-based system for world trade to digitally-enabled trade. The parties agreed to advocate and adopt open and neutral networks, underpinned by international standards for interoperability.
Moving towards digitalised trade requires support for the multilateral rules-based trading system, and interoperability across various digital trade platforms, noted Minister for Communications and Information S Iswaran at the ICC Trade Digitalisation Forum. The TradeTrust framework is designed for this, he added.
TradeTrust aims to ensure interoperability across different digital trade systems, thus allowing digital trade documentation to be exchanged among them.
The framework's components are: legal harmonisation, so digital trade documents are legally valid across different systems; standards development to facilitate the exchange of documents; accreditation for the digital solutions used; and a set of open source codes that can integrate back-end solutions to the TradeTrust network, which is a public blockchain.
The firms signing the agreement were April, DBS Bank, Marubeni Corporation, Mastercard, Mitsubishi Corporation, Mitsui & Co, Mizuho Bank, MUFG Bank, Noble, NTT Data, PSA International, Sompo Japan Nipponkoa, Standard Chartered Bank, Sumitomo Corporation, Sumitomo Mitsui Banking Corporation, Tokio Marine and Trafigura.
The ICC has 45 million institutional members across 130 countries, and its ICC Tradeflow is the first digital trade platform built on the TradeTrust framework. ICC secretary general John Denton said the organisation is "committed to enabling the broadest possible adoption of these digital technologies" and supports the development and recognition of best practice standards for digitalisation.
The first pilot TradeTrust trade in November, using ICC Tradeflow, saw documentation time reduced from 45 days to 20 days. It involved Trafigura's purchase of US$20 million of iron ore from South Africa, supported by DBS Bank as Trafigura's trade finance issuing bank partner.
Said Trafigura Asia-Pacific chief executive officer Tan Chin Hwee: "Working closely with government and the global trade and finance industry ecosystem, we intend to become a regular user of the ICC TradeFlow platform."